TMI Blog2022 (7) TMI 783X X X X Extracts X X X X X X X X Extracts X X X X ..... r it can be said that there is no enquiry at all, then the CIT can very well invoke his powers u/s.263 of the Act, and revise the assessment order. The crux of the matter is that the AO should conduct enquiry to satisfy himself about the genuineness of transaction. The scope of the term enquiry can be different in different cases. There cannot be any hard and past rule to carry out a particular enquiry. Such enquiry would be subject to satisfaction of AO. If the enquiry conducted by the AO is an objective satisfaction, then, even though, the AO has called for necessary materials during the course of assessment proceedings, it will lead to an inference that he has not conducted enquiries he ought to have been conducted. In other words, mere obtaining and placing documents on records cannot be equated into conducting enquiry. In this case, on perusal of facts available on record, there is a prima facie indication that there are few abnormalities on the issue of buyback of shares. In such case, the AO after collection of certain evidences should embark upon further investigation so as to ascertain the true colours of the transactions, because, what is apparent is not real. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or all these reasons, we hold that the assessment order passed by the AO is erroneous in so far as it is prejudicial to the interest of the revenue and thus, the CIT has rightly exercised his jurisdictional powers and set aside the assessment order passed by the AO u/s.143(3) dated 31/12/2016. Hence, we are inclined to uphold the order of the ld.CIT and dismiss the appeal filed by the assessee. - ITA No.2820/Chny/2019 - - - Dated:- 29-6-2022 - Shri Mahavir Singh, Hon ble Vice President And Shri G. Manjunatha, Hon ble Accountant Member For the Appellant : Mr.Sh.Ajay Vohra, Sr.Advocate for Mr.N.V.Balaji, Adv. And Mr.N.V. Narayanan, Adv. For the Respondent : Mr.Ann L. Kapthuama, CIT ORDER PER G. MANJUNATHA, ACCOUNTANT MEMBER: This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax, Large Taxpayer Unit, Chennai, passed u/s 263 of the Income Tax Act, 1961 dated 01.08.2019 and pertains to assessment year 2014-15. 2. The assessee has raised the following grounds of appeal: 1. The order of the learned Commissioner of Income-tax, Large Taxpayer Unit, Chennai ['CIT'] is erroneous, bad in law, prejudicial t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith, and the learned CIT has not brought any evidence to the contrary towards making such findings. 9. The learned CIT has erred in concluding that the provisions of section 2(22)(a) of the Act and/or section 2(22)(d) and consequently section 115-O of the Act are applicable by ignoring that sub-clause (iv) of section 2(22) of the Act specifically excludes a buyback of shares undertaken under section 77 A of the Companies Act, 1956 from the ambit of dividend and ignoring the binding circular No.3 of 2016 dated 26 February 2016. 10. The learned CIT has erred by relying on the judgment of the Hon'ble Karnataka High Court in Fidelity Services India Pvt. Ltd [2018] (95 taxmann.com 253), without appreciating that the Hon'ble Karnataka High Court has not dealt with or decided the issue of characterization of the payment for buy-back of shares on merits. The Appellant craves leave to add, supplement, amend, delete or otherwise modify any of the grounds stated hereinabove at the time of hearing. Statement of facts 1. Cognizant Technology Solutions India Private Limited ('the Appellant') is a company incorporated under the Companies Act, 1956. The A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forming part of the Assessment Order. 6. On 21 March 2018 the learned CIT issued a notice under section 263 of the Act seeking to set-aside the Assessment Order in order to direct the learned AO to examine the examine the valuation of shares bought-back, the applicability of sections 2(22), 115O, 115QA and 195 of the Act to the said buy-back of shares. 7. The said notice under section 263 of the Act was issued after the Hon'ble Madras High Court had taken note of the Assessment Order in a Writ Petition filed by two of the Appellant's shareholders challenging draft assessment orders passed in their case on the same transaction of buy-back of shares. 8. Given the above, the Appellant challenged the notice under section 263 of the Act before the Hon'ble Madras High Court in WP No. 7542 of 2018. The said Writ Petition was dismissed by the Hon'ble Court vide its order dated 25 June 2019 passed by a single Judge and the Appellant was directed to file a suitable response to the notice under section 263 of the Act before learned CIT, who in-turn was directed to pass an order without being influenced by any findings of the Hon'ble High Court in the Orders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s.Cognizant Technology Solutions Corporation, USA. @ Rs.23,915/- per share and paid consideration amounting to Rs.620,00,35,495/-. The assessee had also purchased 16,709 shares from M/s. Market RX Inc. USA and 11,873 shares from M/s.CSS Investments LLC, USA and paid consideration amounting to Rs.39,95,95,735/- and Rs.28,39,42,795/- respectively. The case has been taken up for scrutiny assessment and during the course of assessment proceedings, several hearings were held by the AO and the assessee furnished necessary information called for from time to time, including information relates to buy back of shares from its shareholders. The assessment has been completed u/s. 143(3) of the Income Tax Act, 1961 on 31.12.2016, wherein, certain adjustments were made to the total income of the assessee. However, with respect to the buyback of shares, the AO had accepted the explanation of the assessee and no adjustment was made to the total income. 4. The case has been, subsequently taken up for revision proceedings by the Commissioner of Income Tax (LTU)-1, Chennai, and a show cause notice u/s.263 of the Act, dated 21.03.2018 was issued to the assessee seeking to set aside the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of shares before amalgamation and after amalgamation and noted that the intrinsic value of shares of the amalgamated company prior to the date of amalgamation was Rs.22,582/- per equity share, whereas after amalgamation the intrinsic value of share is reduced to Rs.5,035.63 per equity share. Thus, the ld.CIT was of the opinion that when the fair market value of the share as on the date of buyback of share was at Rs.5,035/- per share, but the assessee has purchased its own shares from its shareholder @ Rs.23,915/- per share in order to make payment to shareholders without affecting taxability under the provision of Sec.2(22)(a) / 2(22)(d) of the Act. The ld.CIT had discussed the issue in light of fair market value of the shares determined by the assessee by following the DCF method and also future cash flows considered by the assessee for the FY 2018-19 to FY 2022-23 in light of a scheme of arrangement and compromise approved by the Hon ble Madras High Court in the FY 2016-17 and observed that there is a variation in free cash flows considered by the assessee which is ranging from 74% to 84% and thus, opined that the assessee has shown cash flows to over value the share price of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s.2(22)(e) of the Act. The AO although has called for certain details about buyback of shares, but failed to carry out necessary enquires or verification which he should have been made in light of various provisions of the Act, which rendered the assessment order to be erroneous and prejudicial to the interest of the revenue. Therefore, set aside the assessment order passed by the AO and direct the AO to examine the DCF valuation of the shares and determine the excess consideration, if any, over and above the fair market value of the shares paid to the shareholders and invoke the provisions of Sec.115-O to 115-P of the Income Tax Act, 1961, in order to treat such excess consideration as distribution of dividends u/s.2(22)(a) of the Act, and recover DDT payable by the assessee as per the provisions of the Act, after affording reasonable opportunity of hearing to the assessee. Aggrieved by the CIT order, the assessee is in appeal before us. 6. The ld. Sr. Counsel for the assessee, Shri Ajay Vohra, submitted that the ld.CIT erred in setting aside the assessment order u/s.263 of the Act, without appreciating the fact that in order to invoke jurisdiction u/s.263 of the Act, twin c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessee further submitted that provisions of Sec.115QA applicable from 01.06.2013 also refers to the consideration received by the shareholders on buyback of shares and not fair market value. Further, CBDT Circular No.3 of 2016 clearly provides that consideration for buyback of shares can be taxed only as capital gain in the hands of the shareholders, and no such amount can be treated as dividend. Since, Circular issued by the CBDT are binding on the tax authorities, the AO after considering necessary facts including the CBDT Circular, has taken a view and hence, the CIT cannot review the order passed by the AO on very same issue by holding that the AO has not carried out required enquiries. The ld.AR for the assessee, further referring to the decision of the Mumbai ITAT in the case of Goldman Sachs (India) Securities (P.) Ltd. reported in [2016] 70 taxmann.com 46 (Mumbai-Trib.), submitted that the Tribunal clearly held that consideration for buyback of shares is taxable only as capital gains and cannot be treated as dividend notwithstanding that capital gains is exempt from tax in India in the hands of Mauritius shareholder in view of the available treaty exemption. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unsustainable, because the AO cannot take any other view except view taken on buyback of shares, because the issue involved in hand is debatable and further, there is no scope for the revenue to re-characterization of income arising from buyback of shares as dividend. The assessee has determined the fair market value of the shares as per DCF methodology and such valuation carried was out by an independent valuer. He further submitted that the assessment can be set aside only in a case, lack of enquiry and not for inadequate enquiry. In the present case, detailed enquires has been made by the AO during the course of assessment proceedings in relation to the buyback of shares as evident from order sheet entry. The AO had specifically asked for the Memorandum of Understanding between the parties, documents relating to date of receipt of the amounts and value at which purchase was made for each entity. The AO had also examined valuation of shares and also non-applicability of dividend taxation to the buyback of shares. In response to the queries, the assessee had submitted detailed replies dated 20.12.2016. Therefore, merely because, the issue does not mention in the assessment order, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t interplay the right of the taxpayer to choose the method of implementing a transaction. In the facts of the case, there is no intent for avoidance of tax considering that the assessee could have repatriated the same amount of buyback consideration to the shareholders by buying back larger number of shares at lower price without breaching the provisions of Sec.77A of the Companies Act, 1956, and without resulting in dilution of the inter-se shareholding percentage. In this regard, the assessee has illiterated how consideration paid by the assessee is not impacted the shareholding pattern of shareholders. 10. The ld. Counsel for the assessee further submitted that the revenue has taken a contradictory position in as much as in the case of the assessee, the CIT has directed the AO to determine the fair value of shares as per DCF method and treat the same as capital gains to the extent of fair market value and balance as dividends liable for dividend distribution tax u/s.115-O of the Income Tax Act, 1961. However, in the case of shareholders, the AO in the draft assessment order has treated the buyback consideration as taxable under the head capital gains to the extent of fair v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court of Madras 4 CIT v. Sunbeam Auto Ltd. 332 ITR 167 High Court of Delhi 5 PCIT v. Cartier Leaflin (P) Ltd. 112 taxmann.com 63 High Court of Bombay 6 Jain Construction Co. 34 Taxmann.com 84 High Court of Rajasthan 7 Ratlam Coal Ash Co. 171 ITR 141 High Court of Madhya Pradesh 8 MOIL Ltd. v. CIT 396 ITR 244 High Court of Bombay 9 CIT v. Vikas Polymers 341 ITR 537 High Court of Delhi 10 CIT v. Krishna Capbox (P.) Ltd. 372 ITR 310 High Court of Allahabad 11 CIT v. Vam Resorts Hotels (P) Ltd. 418 ITR 723 High Court of Allahabad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... patnam Tribunal 28 Reliance Industries Ltd. PCIT ITA No.578/Mum/2021 Mumbai ITAT 29 Vaghasiya Exports v. PCIT ITA No.2288/Mum/2019 Mumbai ITAT 30 Vrutti Developers LLPv. PCIT ITA No.1085/Mum/2019 Mumbai ITAT 31 Manoj Kumar Biswas v. PCIT [2021] 214 TTJ (Kol) 340 Kolkata ITAT 32 ITO v. DG Housing Projects Ltd. [2012] 343 ITR 329 High Court of Delhi 33 J.P.Srivastava Sons (Kanpur) Ltd. v. CIT [1978] 111 ITR 326 High Court of Allahabad 34 CIT v. Sunbeam Auto Ltd. [2010] 189 Taxman 436 High Court of Delhi 35 CIT v. Vikas Polymers [2010] 194 Taxman 57 Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 51 Hari Iron Trading Co. v. CIT [2003] 263 ITR 437 High Court of Punjab Haryana 52 Bycell Telecommunications India (P) Ltd. v. PCIT [2018] 90 taxmann.com 268 Delhi Tribunal 53 G.L.Sultania and Anr. V. Securities and Exchange Board of India Ors. AIR 2007 SC 2172 - 54 CIT v. Titan Time Products Ltd. [2015] 273 CTR Bombay 55 Karmic Labs Pvt. Ltd. v. ITO ITA No.3955/Mum/2018 - 56 VBHC Value Homes Pvt. Ltd. v. ITO TS 281 ITAT 2020 - 57 CIT v. G.M.Mittal Stainless Steel (P) Ltd. [2003] 263 ITR 255 Supreme Court of India 58 CIT v. Paul Brothers [1995] 216 ITR 548 High Court of Bomb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing prejudice to the interests of the revenue. During the course of assessment proceedings, the AO, though called for the details of 'buy back' transactions, but failed to draw logical conclusion, especially with regard to the fair market value of the shares for the purpose of buy-back, and the consequential applicability of provisions of section.115-Or.w.s 2(22) of the Act. Hence, the assessment order passed by the AO is erroneous. In view of the above, it is submitted that the order of the AO is not only erroneous and also prejudicial to the interests of the revenue, within the meaning of provisions of section 263 of the Act. Hence, the learned CIT is justified in passing the impugned revisionary order. 12. The ld. DR further submitted that the ld. Counsel for the assessee heavily placed his reliance on the valuation report under DCF method obtained by the appellant from M/s. Ernst Young. However, said valuation report cannot be relied upon, since, the same was issued by manipulating the projections to arrive at an illogical value of Rs.23,915/- per share. From the paper book submitted by the assessee, it is evident that the AO had enquired only in respect of buy bac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee during the course of revision proceedings and he came to the conclusion that although, the AO has examined the issue of buyback of shares during assessment proceedings, but failed to conduct necessary enquires which he ought to have been carried out in terms of Explanation2 to s.263 of the Act. Therefore, before deciding the issue on hand, it is necessary to re-capture the facts brought out by the ld.CIT in his revision order u/s.263 of the Act. 14. As could be seen from the facts brought out by the ld.CIT, during the FY 2011-12, two Indian companies i.e. M/s.Cognizant India Pvt. Ltd. (CIPL) M/s. Market RX India Pvt. Ltd., (MIPL) got amalgamated with the assessee company M/s.Cognizant Technology Solutions India Pvt. Ltd. (CTS). M/s.Cognizant (Mauritius) Ltd., held 100% shares of CIPL MIPL. Similarly, CTS India is 100% subsidiary of M/s.Cognizant Technology Solutions Corporation, USA. It was further noted that before amalgamation, the fair market value shares of CTS, in which M/s.Cognizant Technology Solutions Corporation, USA, was holding 100% equity shares was at Rs.22,582/- per share, whereas, the equity share value of CIPL MIPL was only at Rs.1,447/- per share and Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s erroneous, the CIT cannot interfere. Again, merely because, the order of the officer is prejudicial to the interests of the Revenue, then again, that is not enough to confer jurisdiction on the CIT to interfere in revision. These two elements must co-exist, this is because, the first of the two requirements namely, (i) the order is erroneous and (ii) the same is also prejudicial to the Interests of the Revenue, must be satisfied. Similarly, if an order is erroneous, but not prejudicial to the interests of the Revenue, then also the power of suo-motu revision, cannot be exercised. Any and every erroneous order cannot be the subject-matter of revision, because the second requirement also must be fulfilled. There must be some prima facie material on record to show that tax which was lawfully exigible has not been imposed or that by the application of the relevant statute on an incorrect or incomplete interpretation a lesser tax than what was just has been imposed. 16. The phrase 'prejudicial to the interests of the Revenue' has to be read in conjunction with an erroneous order passed by the AO. Every loss of revenue as a consequence of an order of AO cannot be treated as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FEMA Regulations. The assessee had also deducted TDS on consideration paid to non-resident shareholders wherever such consideration is liable for capital gains tax in India in terms of s.46A of the Act. In fact, the CIT has never disputed the fact that the assessee has complied with provisions of Sec.77A of the Companies Act, 1956 and other regulatory requirements. According to the CIT, although the assessee has satisfied the conditions prescribed for buyback of shares, but, consideration paid by the assessee for buyback of shares to its shareholders is not genuine and further, the same has been overvalued so as to make the payment to the shareholders of its surplus funds without affecting their taxability in terms of Sec.2(22)(a) / 2(22)(d) of the Act, and consequent DDT payable by the assessee u/s.115-O to 115-P of the Income Tax Act, 1961. 18. We have given our thoughtful consideration to the reasons given by the ld.CIT to set aside the assessment order u/s.263 of the Act, in light of various arguments advanced by the ld. Counsel for the assessee and we ourselves do not subscribe to the arguments of the ld. Counsel for the assessee for the simple reason that although, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is a restructuring of shareholding pattern of the company before buyback of shares and further, the major shareholding controlling more than 75% of share capital of the company is exempt from payment of capital gains tax in terms of Sec.46A of the Act, the AO ought to have examined the issue and consideration paid by the assessee for buyback of shares in light of provisions of Sec.2(22)(a)/(d). In this case, although, what is apparent is not real, the AO simply accepted the explanation furnished by the assessee without any application of mind to relevant provisions of Act in light of peculiar facts of the case. In our considered view, the enquiries conducted by the AO can be set to have been half-baked enquiry ignoring vital aspects, which were required for examination. Because, no prudent business person will buy its own shares at such an exorbitant price, when the book value or intrinsic value of the share was very much less when the buyback of shares were happened. Therefore, we are of the considered view that enquiries conducted by the AO resulting in drawing incorrect assumption of facts, makes the order erroneous and prejudicial to the interest of the revenue. Further, if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the assessee that the AO has caused detailed enquiry on the issue of buyback of shares during the course of assessment proceedings by calling for various details, for which, the assessee has filed necessary details and merely, for the reason that the issue does not find mention in the assessment order, it does not mean that the same has not been examined by the AO, where examination of record shows otherwise. We find that although, it appears that the AO has conducted enquiries on the issue of buyback of shares, but in principle, the enquiries conducted by the AO is a case of lack of enquiry or no enquiry at all. Because, even though, there is a scope for AO to test the buyback of shares and consideration paid by the assessee in light of provisions of Sec.2(22)(a) / 2(22)(d) of the Act, but, the AO restricted the scope of enquiry in light of provisions of Sec.46A of the Act, relevant provisions of Companies Act, 1956, and tax treaty between India and Mauritius without going into the aspect of distribution of accumulation of profits of the company in the grab of buyback of shares. No doubt, where the law enables the taxpayer to choose one out of various available options, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, but, once it is observed that it is a case of lack of enquiry then the question of inadequacy in enquiry conducted by the AO does not arise. Because, what is enquiry which required to be conducted by the AO has been explained by insertion of Explanation-2 to Sec.263 of the Act. As per which, the orders passed without making enquiries or verification which should have been made are called as erroneous orders. In this case, we have already observed that enquiry conducted by the AO can at best be termed as no enquiry and thus, we are of the considered view that though there is no unfettered powers of revision to the CIT even after Explanation-2 to s.263 but when it comes to a case of lack of enquiry, the CIT does have power to revise the assessment order and thus, we find no merits in the arguments taken by ld. Counsel for the assessee. In so far as legal proposition argued by ld. Counsel for the assessee on the issue of change of opinion and powers of CIT u/s.263 of the Act, we are of the considered view that the concept the of change of opinion is relevant in so far as re-assessment proceedings is concerned. However, when it comes to revision powers of the Commissioner u/s.263 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon ble Supreme Court including in the case of UOI v. Azadi Bachao Andolan [2003] 263 ITR 706 But, all arrangements between the parties cannot be accepted as legitimate tax planning when facts gathered suggest otherwise. In such cases, the decision of the Hon ble Supreme Court in the case of Mc.dowell Co. Ltd. v. CIT (supra) would be relevant decide whether or not the parties resorted to any kind of tax avoidance plan, where it has been held that tax planning for the purpose of avoidance of payment of tax should be regarded as colourable devices and those needs to be examined by lifting the corporate veil. Therefore, the arguments of the ld. Counsel for the assessee that after the decision of UOI v. Azadi Bachao Andolan(Supra) much water flown in the system and thus, each and every case, cannot be examined in light of decision of Mc.dowell Co. Ltd. v.CIT cannot be accepted. In our considered view, even after UOI vs. Azadi Bachao Andolan (Supra), the decision of Mc.dowell Co. Ltd. vs. CTO (Supra) still holds good and thus, we reject the arguments of the ld. Counsel for the assessee. 22. Coming back to the decision of the Hon ble Karnataka High Court in the case of Fidelity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . An order is said to be prejudicial to the interests of the revenue not only where the due tax has not come to the coffers of the exchequer, but, also where bad precedent is set by the AO. In other words, the expression prejudicial to the interests of the revenue needs to be viewed in a broader sense and cannot be confined to its narrow meaning of non-realization of the due tax only. It further explained the ambit of the expression prejudicial to the interests of the revenue by laying down that it: is not an expression of art and is not defined in the Act. Understood in its ordinary meaning, it is of wide import and is not confined to loss of tax. The facts of the instant cases speak volumes of the bad trend set up by the AO in not conducting proper enquiries, which in our considered opinion have been rightly set aside by the CIT u/s.263 of the Act. Thus, we are of the considered view that the case law relied upon by the ld. Counsel for the assessee in the case of Malabar Industrial Company Ltd. Vs. CIT (2000) 243 ITR 83 (SC) will not rescue the case of the assessee. 24. At this stage, it is relevant to consider observations of the Hon ble Delhi High Court in Gee Vee Enter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. 26. The Hon ble Rajasthan High Court in the case of Smt.Renu Gupta v. CIT [2007] 211 CTR 147 had also considered an identical issue and held that the CIT may considered an order of the AO to be erroneous not only if there is an apparent error of reasoning or of law or of facts on the face of it but also when it is a stereo type order which simply accepts what the assessee has stated in his submission and fails to make enquiries which are called for in the circumstances of the case. It is not necessary for the CIT to make further enquiry before cancelling the assessment order of the AO. The Hon ble Madras High Court in the case of Mofussil Warehouse Trading v. CIT [1998] 238 ITR 867 has considered an identical issue and held that when nothing is traceable to the assessment order as relatable to the application of mind for the part of the ITO to the silent provisions adumbrated under relevant provisions of the Act and further, if he really applied his mind in this regard, there have been some sort of discussion in the order and the absence of any discussion therefore, is a clear indication of his non-application of mind. The non-performance of such a duty on the part of the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me his jurisdiction and set aside the assessment order. In this case, it has been observed that it is a case of lack of enquiry or no enquiry at all and thus, the CIT has rightly invoked his jurisdiction and set aside the order and hence, the case laws relied upon by the assessee are not applicable to the facts of present case. 29. The ld. Counsel for the assessee has also relied upon plethora of judicial precedents in support of various legal propositions including satisfaction of the CIT before invoking his powers, in light of the decision of the Hon ble Delhi High Court in the case of ITO v. DG Housing Project Ltd. [2012] 343 ITR 329. We find that there is no dispute about legal proposition laid down by the Hon ble High Court in as much as the CIT must record a prima facie satisfaction that the assessment order is prejudicial to the interest of the revenue and not merely remit the issue to the AO for re-examination. But fact remains that in this case, the CIT had brought out clear facts and also given various reasons to come to the conclusion that how and why assessment order passed by the AO erroneous and prejudicial to the interest of the revenue. Therefore, we are of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od of valuation, approval/verification, etc. In this case, there is no doubt of whatsoever with regard to satisfaction of the CIT before setting aside the assessment order u/s.263, where he had very categorically observed that the assessment order is erroneous and prejudicial to the interest of the revenue for various reasons including for lack of enquiry or no enquiry at all, non-application of mind by the AO to the relevant provisions and thus, we are of the considered view that there is no merit in the arguments taken by the ld. Counsel for the assessee in light of various decisions ad hence, the case laws cited by the Counsel for the assessee are rejected. In so far as various case laws cited by the assessee, although those case laws are not specifically dealt with in this order in light of facts of the present case to decide whether ratio laid down in said cases is applicable to the facts of the present case or not but, we have gone though all those case laws cited by the ld. Counsel for the assessee and tested the ratio laid down therein, to the facts of the present case and find that those case laws have no application to the facts of the present case and thus, we are of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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