G.S.ATWAL & CO (ENGG) PVT. LTD,KOLKATA vs. PCIT, KOL-2,KOL, KOLKATA

After hearing rival contentions and perusing the material on record, we observe that the observations of the ld. Pr. CIT as to the assessment order passed u/s 143(3) of the Act dt. 29/03/2021 being erroneous and prejudicial to the interest of the revenue appears to be incorrect as the Assessing Officer has correctly brought to tax the MAT u/s 115JB of the Act showing book profit of Rs. /-. We note that even the revised computation is filed by the assessee upon revision of the ITR and net profit has been show in the P&L at Rs. 71,59,839/-. We further notice from the table extracted at page no. 3 of the revisionary order which showed that the assessee has reconciled business loss and unabsorbed appreciation while calculating the book profit u/s 115JB of the Act, the allowance has to be made in respect of business loss or unabsorbed deprecation whichever is less, so even if we take up the contentions of the ld. Pr. CIT as correct for the time being, even then, the books profit as computed by the Assessing Officer has not caused any prejudice to the revenue and the assumption of juri iction u/s 263 of the Act is invalid as the conditions for invoking the juri iction are not fulfilled. Taking into account these facts and circumstances, we are inclined to hold that the order passed by the ld. Pr. CIT is without juri iction as the assessment framed by the Assessing Officer is neither erroneous nor prejudicial to the interest of the revenue.

We draw strength from the decision of the Hon’ble Apex court in Malabar Industrial Co. Ltd. Vs CIT 243 ITR 83(SC) wherein the Hon'ble Court has held that the twin condition has to be satisfied and even if one of the conditions i.e., erroneous and prejudicial to the interest of the revenue, then the revisionary juri iction are bad in law. We notice that in the present case, the assessment so framed is neither prejudicial nor erroneous to the interest of the revenue and, therefore, the juri iction has been wrongly exercised by the ld. Pr. CIT.

We observe that the Assessing Officer is a quasi judicial authority and in the instant case, the Assessing Officer has taken view which is correct as per the facts available on record and the juri iction u/s 263 of the Act cannot be invoked by the ld. Pr. CIT merely on the ground that the view taken by the Assessing Officer is not acceptable to the ld. Pr. CIT and he wishes to substitute his view in place of the Assessing Officer's view as has been held by the Honble Bombay High Court in Commissioner Of Income-Tax vs Gabriel India Ltd. reported in [1993]203ITR108(BOM). We note that the ld Pr. CIT has not recorded any objective finding on the basis of records before him as to how the order passed by the Assessing Officer is wrong and the said view is in conformity with the ratio laid down by Hon’ble Delhi High Court in ITO vs. DG Housing Projects Limited reported in [2012] 343 ITR 329 (Del.)

Considering the above facts and the ration of law laid down by various Hon'ble Courts, we quash the revisionary proceedings u/s 263 of the Act and the assessment order dt. 29/03/2021 is restored.

In the result, appeal of the assessee is allowed. Order pronounced in the Court on 22nd April, 2024 at Kolkata. (SONJOY SARMA) ACCOUNTANT MEMBER Kolkata, Dated 22/04/2024 *SC SrPs आदेश क" "ितिलिप अ"ेिषत/Copy of the Order forwarded to : 1. अपीलाथ" / The Assessee

""यथ" / The Respondent 3. संबंिधत आयकर आयु" / Concerned Pr. CIT 4. आयकर आयु" अपील ( ) / The CIT(A)- 5. िवभागीय "ितिनिध ,आयकर अपीलीय अिधकरण, कोलकाता/DR,ITAT, Kolkata, 6. गाड" फाई/ Guard file.