“lack of inquiry”

Rectification & RevisionSection 263Section 2631,087 judgments

The decision most relied on for lack of inquiry is CIT v. Gabriel India Ltd. (203 ITR 108), cited in 990 judgments on BharatTax.

Leading authorities on lack of inquiry

CIT v. Gabriel India Ltd.

203 ITR 108 · 1993 · High Court

990

citing judgments

The Commissioner cannot revise an assessment order under Section 263 merely because they hold a different opinion or believe a deeper inquiry was warranted if the Assessing Officer has applied their mind and conducted some inquiry. Revision under Section 263 is permissible only in cases of a complete lack of inquiry or non-application of mind by the Assessing Officer, not for merely inadequate inquiry.

CIT v. Orissa Corporation Pvt. Ltd.

159 ITR 78 · 1986 · Supreme Court

897

citing judgments

When an assessee provides the identity and address of a creditor or investor for a cash credit or share capital under Section 68, the burden shifts to the Department to establish lack of genuineness or creditworthiness, requiring it to conduct further inquiries; mere non-compliance by third parties to summons cannot be the sole basis for an adverse inference against the assessee.

CIT v. Sunbeam Auto Ltd.

332 ITR 167 · 2011 · High Court

897

citing judgments

The Commissioner cannot revise an assessment under Section 263 merely because the assessment order does not explicitly reflect an inquiry, or because the Commissioner holds a different opinion. An inquiry, even if considered inadequate, or an assessment based on a plausible view by the Assessing Officer after due examination, does not automatically make the order erroneous or prejudicial to the interests of the revenue.

Gee Vee Enterprises v. Addl. CIT

99 ITR 375 · 1975 · High Court

543

citing judgments

An assessment order is erroneous and prejudicial to the interest of revenue if the Assessing Officer fails to make proper inquiries before accepting the assessee's statements or claims. The Commissioner can revise such an order under Section 263 without conducting further inquiries himself.

CIT v. Anil Kumar Sharma

335 ITR 83 · 2011 · High Court

264

citing judgments

The Commissioner cannot invoke Section 263 for an assessment merely because of an inadequate inquiry by the Assessing Officer, provided there was some inquiry or the record demonstrates application of mind, as this constitutes a mere difference of opinion.

Narayan Tatu Rane v. ITO

70 Taxmann.com 227 · 2016 · ITAT

220

citing judgments

Before revising an assessment order under Section 263, the CIT/PCIT must conduct their own inquiries or verifications to establish that the Assessing Officer's order is erroneous and unsustainable in law, rather than merely directing further inquiry or pointing out the AO's lack of inquiry.

DIT v. Jyoti Foundation

357 ITR 388 · 2013 · High Court

210

citing judgments

An assessment order cannot be deemed erroneous and prejudicial to the interest of revenue under Section 263 if the Assessing Officer conducted an inquiry and applied their mind during the original assessment, as Explanation 2 to Section 263 does not permit unending inquiries by the revisional authority.

CIT v. Infosys Technologies Ltd.

341 ITR 293 · 2012 · High Court

205

citing judgments

A Commissioner can revise an assessment order under Section 263 if it is erroneous and prejudicial to the interests of the revenue. This includes cases where the Assessing Officer fails to make further inquiries before accepting the assessee's statements in the return.

Judgments citing lack of inquiry

Chandi Filling Station, Cuttack vs. Principal CIT-1, Bhubaneswar

In the result, appeal of the assessee stands partly allowed

ITA 10/CTK/2022[2017-18]Status: DisposedITAT Cuttack13 Dec 2022AY 2017-18

Bench: Before S/Shri George Mathan, Judicial & Arun Khodpia & Arun Khodpia & Arun Khodpiaassessment Year: 2017-18 Chandi Chandi Filling Filling Station, Station, Vs. Pr. Cit-1, Manguli, Cuttack Manguli, Cuttack Bhubaneswar Bhubaneswar Pan/Gir No Pan/Gir No.Aacfc 8350 K (Appellant) ) .. ( Respondent Respondent)

For Appellant: Shri Mohit Sheth, ARFor Respondent: Shri M.K.Gautam, CIT

Section 115BSection 142(1)Section 263Section 40

material. If this component is missing, it will P a g e 5 | 13 Assessment year: 2017-18 always be a case of lack of inquiry and not inadequate inquiry. The relevant portion of the order of Hon'ble ITAT is reproduced below:— "28.1 Ld. Special counsel has rightly pointed ... that the expression, 'inquiry, 'lack of inquiry' and 'inadequate inquiry', have not been defined and, therefore, when the action of the AO would be suggestive of lack of inquiry or inadequate inquiry, will depend upon the facts obtaining in a particular case. What emerges as a broad principle from

Siddhi Vinayak Knots & Prints Private Limited, Surat vs. Pr. CIT-2, Surat

In the result, the appeal filed by the assessee is dismissed

ITA 58/SRT/2022[2017-18]Status: DisposedITAT Surat12 Dec 2022AY 2017-18

Bench: Shri Pawan Singh, Jm & Dr. A. L. Saini, Am आयकर अपील सं./Ita No.58/Srt/2022 "नधा"रणवष"/Assessment Year: (2017-18) (Physical Court Hearing) Siddhi Vinayak Knots & Prints Pvt. Ltd. Vs. The Pcit-2, A-26, Central Park, Gidc, Pandesara Surat. S.O., Pandesara, Surat-394221. (Appellant) (Respondent) "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aamcs4421L

Section 143(3)Section 2(24)(x)Section 263Section 36(1)(va)

section 263 of the Act and it cannot be held to be justified.” 15. Though there is a fine though subtle distinction between “lack of inquiry” and “inadequate inquiry,” it is only in cases of “lack of inquiry” that the CIT can exercise his revisional jurisdiction. As held

Prashant Prabhakar Degaonkar, Solapur vs. Pr. Commissioner of Income-Tax -6, Pune

The appeal stands dismissed

ITA 453/PUN/2020[2015-16]Status: DisposedITAT Pune08 Dec 2022AY 2015-16

Bench: Hon’Ble Shri S.S. Viswanethra Ravi & Shri G. D. Padmahshaliआयकर अपील सं. / Ita No. 453/Pun/2020 धििाारण वर्ा / Assessment Year : 2015-16 Prashant Prabhakar Degaonkar (Huf) 256/257, East Mangalwar Peth, Solapur–413 002 Pan: Aahhp5930P . . . . . . . अपीलार्थी / Appellant बिाम / V/S Pr. Commissioner Of Income Tax-6 Pune . . . . . . . . प्रत्यर्थी / Respondent द्वारा / Represented Assessee By : Shri S. N. Puranik Revenue By : Shri P. R. Mane सुनवाई की तारीख / Date Of Conclusive Hearing : 05/12/2022 घोषणा की तारीख / Date Of Pronouncement : 05/12/2022 आदेश / Order Per G. D. Padmahshali, Am; Present Appeal Of The Appellant Assessee Is Assailed Against The Revisionary Order Of Pr. Commissioner Of Income Tax-6, Pune [For Short “Pcit”] Dt. 11/03/2020 Passed U/S 263 Of The Income-Tax Act, 1961 [For Short “The Act”], Which Sprung Out Of Assessment Order Dt. 30/06/2017 Passed U/S 143(3) By The Income Tax Officer, Ward-1(2), Solapur [For Short “Ao”] For Assessment Year [For Short “Ay”] 2015-16. Itat-Pune Page 1 Of 17

For Appellant: Shri S. N. PuranikFor Respondent: Shri P. R. Mane

Section 143(1)Section 143(3)Section 263

decision of Hon'ble Supreme Court in “Malabar Industries Vs CIT” reported in 243 ITR 83 and two of such test are; a. Lack of inquiry or insufficient inquiry will suffice the requirement as to order being erroneous. b. Where the order is passed without application of mind, will fall ... bringing to tax income from sale of jaggery, therefore hit by proviso to section 263 of the Act, this ispo-facto showed both lack of inquiry into nature of exempted income claimed to have earned by the appellant and non- application of mind, in such circumstances, we find force

Chandrakant Ramakant Pise, Solapur vs. Principal Commissioner of Income-Tax-4, Pune

Appeals are dismissed in above terms

ITA 268/PUN/2021[2013-14]Status: DisposedITAT Pune07 Dec 2022AY 2013-14

Bench: Shri S.S.Godara & G.D.Padmahshaliआयकरअपीलसं. / Ita Nos.267 & 268/Pun/2021 िनधा"रणवष" / Assessment Years: 2011-12 & 2013-14

Section 143(2)Section 143(3)Section 147Section 263

produce in both these assessment years which was rightly accepted by the Assessing Officer and, therefore, this is certainly not an instance of lack of inquiry or inadequate inquiry, as the case may be, as alleged at the Revenue’s behest in light of the PCIT’s revision directions ... thoughtful consideration to the foregoing rival contentions and find no merit in assessee’s stand. We first of all find that apart from lack of inquiry or erroneous decision taken by the assessing officer concerned attracting section 263 revision jurisdiction; simultaneously, in light of M/s.Malabar Industrial Company

Chandrakant Ramakant Pise, Solapur vs. Principal Commissioner of Income-Tax-4, Pune

Appeals are dismissed in above terms

ITA 267/PUN/2021[2011-12]Status: DisposedITAT Pune07 Dec 2022AY 2011-12

Bench: Shri S.S.Godara & G.D.Padmahshaliआयकरअपीलसं. / Ita Nos.267 & 268/Pun/2021 िनधा"रणवष" / Assessment Years: 2011-12 & 2013-14

Section 143(2)Section 143(3)Section 147Section 263

Mojilal Rajput, Shujalpur Mandi vs. ITO, Shajapur

In the result, assessee’s appeal is allowed

ITA 21/IND/2022[2009-10]Status: DisposedITAT Indore06 Dec 2022AY 2009-10

Bench: Ms. Madhumita Roy & Shri Bhagirath Mal Biyani

For Appellant: Shri Rajesh Mehta & Shri ApurvaFor Respondent: Shri P.K. Mitra, CIT-DR

Section 142(1)Section 143Section 143(3)Section 148Section 263Section 44ASection 80C

this regard. 7.2 Delhi High Court in the case of CIT Vs. Sunbeam Auto 332 ITR 167 (Del.), made a distinction between lack of inquiry and inadequate inquiry. The Hon’ble court held that where the AO has made inquiry prior to the completion of assessment, the same cannot ... revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between “lack of inquiry” and “inadequate inquiry”. If there was any inquiry, even inadequate, that would not by itself, give occasion to the Commissioner to pass orders under section

Mojilal Rajput, Sujalpur Mandi vs. The ITO, Shajapur

In the result, assessee’s appeal is allowed

ITA 20/IND/2022[2009-10]Status: DisposedITAT Indore06 Dec 2022AY 2009-10

Bench: Ms. Madhumita Roy & Shri Bhagirath Mal Biyani

For Appellant: Shri Rajesh Mehta & Shri ApurvaFor Respondent: Shri P.K. Mitra, CIT-DR

Section 142(1)Section 143Section 143(3)Section 148Section 263Section 44ASection 80C

Roop Singh Tanwar, Dewas vs. The CIT, Ujjain

In the result, this appeal of assessee is allowed

ITA 52/IND/2020[2009-10]Status: DisposedITAT Indore06 Dec 2022AY 2009-10

Bench: Shri Chandra Mohan Garg & Shri B.M. Biyaniassessment Year: 2009-10 Shri Roop Singh Tanwar Pcit Dewas Ujjain बनाम/ Vs. (Appellant / Assessee) (Respondent / Revenue) Pan: Ajtpt 7633 E Assessee By Shri A.K. Mahajan, Ar Revenue By Shri P.K. Mishra, Cit-Dr Date Of Hearing 07.11.2022 Date Of Pronouncement 06.12.2022

Section 143(3)Section 147Section 148Section 263

M/S Anshu Metals Pvt. Ltd., Howrah vs. PCIT-5, Kolkata

In the result, the appeal is dismissed and the substantial questions of law are answered against the revenue

ITA 90/KOL/2022[2010-11]Status: DisposedITAT Kolkata30 Nov 2022AY 2010-11

Bench: Shri Rajesh Kumar & Shri Sonjoy Sarma]

Section 142Section 143(3)Section 148Section 263

Submitted any details in the course of the assessment proceedings and further on the basis of wrong ground that there was lack of inquiry by Ld. Assessing Officer on the issue of commodity transactions entered through NMCE Platform. vi. That the impugned Order dated 16th March, 2020 passed

V.Natarajan, Rasipuram vs. ACIT Central Circle, Salem

The appeals stand allowed in terms of our above order

ITA 468/CHNY/2021[2016-17]Status: DisposedITAT Chennai30 Nov 2022AY 2016-17

Bench: Hon’Ble Shri V. Durga Rao & Hon’Ble Shri Manoj Kumar Aggarwal, Am आयकरअपील सं./ Ita No.467/Chny/2021 (िनधा1रण वष1 / Assessment Year: 2015-16) & आयकरअपील सं./ Ita No.468/Chny/2021 (िनधा1रण वष1 / Assessment Year: 2016-17) Shri V.Natarajan Acit बनाम/ 64C, Rotary Nagar, Central Circle, Vs. Rasipuram -637 408. Salem. "थायीलेखासं./जीआइआरसं./Pan/Gir No. Acgpn-1477-Q (अपीलाथ"/Appellant) : ( !थ" / Respondent) अपीलाथ"कीओरसे/ Appellant By : Shri T.S. Lakshmi Venkataraman (Ca)-Ld. Ar !थ"कीओरसे/Respondent By : Shri M. Rajan, (Cit)-Ld. Dr सुनवाईकीतारीख/ : 15-11-2022 Date Of Hearing घोषणाकीतारीख / : 30-11-2022 Date Of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal ():

For Appellant: Shri T.S. Lakshmi Venkataraman (CA)-Ld. ARFor Respondent: Shri M. Rajan, (CIT)-Ld. DR

Section 132Section 143(3)Section 263

revenue. 8. The Hon’ble Delhi Court, in the cited decision, further observed that there is a fine though subtle distinction between "lack of inquiry" and "inadequate inquiry". It is only in cases of "lack of inquiry" that the Commissioner is empowered to exercise his revisional powers by calling

V.Natarajan, Rasipuram vs. ACIT Central Circle, Salem

The appeals stand allowed in terms of our above order

ITA 467/CHNY/2021[2015-16]Status: DisposedITAT Chennai30 Nov 2022AY 2015-16

For Appellant: Shri T.S. Lakshmi Venkataraman (CA)-Ld. ARFor Respondent: Shri M. Rajan, (CIT)-Ld. DR

Section 132Section 143(3)Section 263

Bharat Malhotra (Prop M/S Shri Nathji Jewels), Karnal vs. Pr, CIT, Rohtak

In the result, the appeal of the assessee in ITA No

ITA 826/DEL/2022[2017-18]Status: DisposedITAT Delhi30 Nov 2022AY 2017-18

Bench: Shri N.K. Billaiya & Shri Kul Bharat

For Appellant: Shri Ajay Wadhwa, AdvFor Respondent: Shri M. Baranwal, CIT- DR

Section 133ASection 143(3)Section 263

revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between "lack of inquiry" and "inadequate inquiry". If there was any inquiry, even inadequate that would not by itself give occasion to the CIT to pass orders under ... merely because he has different opinion in the matter. It is only in cases of "lack of inquiry" that such a course of action would be open”. 30. Considering the facts of the case in totality from all possible angles, we failed to persuade ourselves to accept the contention

Shri Prashant Agrawal, Bhopal vs. Pr. CIT -I, Bhopal

In the result, assessee’s appeal is allowed

ITA 561/IND/2019[2014-15]Status: DisposedITAT Indore24 Nov 2022AY 2014-15

Bench: Ms. Madhumita Roy & Shri Bhagirath Mal Biyani

For Appellant: Shri Ashish Goyal & Shri N. DFor Respondent: Shri P. K. Mitra, CIT.D.R

Section 142(1)Section 143(2)Section 143(3)Section 263

M/S La Opala RG Ltd, Kolkata vs. ACIT, Cir. 11(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 296/KOL/2022[2017-18]Status: DisposedITAT Kolkata24 Nov 2022AY 2017-18

Bench: Shri Sanjay Garg, Hon’Ble & Shri Manish Borad, Hon’Blei.T.A. No. 296/Kol/2022 Assessment Year: 2017-18 M/S. La Opala Rg Ltd. Assistant Commissioner Of Income Eco Centre Tax, Circle-11(1), Kolkata Vs 8Th Floor Em-4, Sector-5 Kolkata - 700091 [Pan : Aaacl5569J] अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri A.K. Tulsiyan, Fca Revenue By : Shri Biswanath Das, Cit D/R सुनवाई क" तारीख/Date Of Hearing : 08/09/2022 घोषणा क" तारीख/Date Of Pronouncement : 24/11/2022 आदेश/O R D E R Per Manish Borad: The Present Appeal Is Directed At The Instance Of The Assessee Against The Order Of Learned Principal Commissioner Of Income Tax, Kolkata -2 (Hereinafter The “Ld. Pr. Cit”) Dt. 29/03/2022, Passed U/S 263 Of The Income Tax Act, 1961 (“The Act’), For Assessment Year 2017-18. 2. Brief Facts Of The Case Is That The Assessee Is A Limited Company & Income Of Rs.52,63,83,260/- Declared In The E-Return Furnished On 31/10/2017 Pertaining To Assessment Year 2017-18. Assessment U/S 143(3) Of The Act Was Completed On 21/12/2019 Assessing Income At Rs.56,22,70,863/-. Thereafter, The Ld. Pr. Cit Called For The Assessment Record & After Going Through The Same It Was Observed That The Order Of The Assessment Was Erroneous Insofar As It Is Prejudicial To The Interest Of The Revenue On The Following Grounds:- “Upon Examination Of Case Records, It Is Observed That The Assessee Had An Income Of Rs. 49,08, 14,480/- From Sitaganj Exempted Unit In Which The Assessee Had Claimed Deduction U/S. 80Ic Of The Act Of Rs. 14,72,44,452/- (30% Of Rs.49,08, 14,480/-). It Was Observed From The Profit & Loss Accounts Of The Assessee For The Year Ended 31.03.2017 That The Assessee Had Credited An Amount Of Rs. 2,43,75, 193/- From Export Incentives & Also

For Appellant: Shri A.K. Tulsiyan, FCAFor Respondent: Shri Biswanath Das, CIT D/R

Section 143(3)Section 263Section 37(1)Section 80Section 801CSection 80I

Delhi High Court in the case of CIT Vs. Sunbeam Auto Ltd. (227 CTR 133) drew the thin line of difference between "lack of inquiry" and "inadequate inquiry" and held that in the case of inadequate inquiry there cannot be 263 order. Therefore, according to ld AR, for argument sake ... finding fault with the order of the AO as erroneous as well as prejudicial to the interest of revenue on account of lack of inquiry has to fail. 10. Now we proceed to answer the question as to whether the decision of the AO, after perusal of the reply

Aadi Industries Limited, Mumbai vs. Principle CIT -14, Mumbai

In the result, we set aside the order of the CIT dated

ITA 1675/MUM/2022[2010-2011]Status: DisposedITAT Mumbai24 Nov 2022AY 2010-2011

Bench: Shri Kuldip Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Blem/S. Aadi Industries Limited V. Pr.Cit – 14 421, 4Th Floor Room No. 426, 4Th Floor Kailash Plaza, Vallabh Baug Lane Aayakar Bhavan, M.K. Road Mumbai - 400020 Near R-Odeon Mall, Ghatkopar(E) Mumbai - 400075 Pan: Aaacj8256G (Appellant) (Respondent) Assessee Represented By : Shri Mandar Vaidya Department Represented By : Shri Jagadish Jangid

Section 143(3)Section 263

recourse to the jurisdiction u/s.263 even after agreeing on the factual conclusion reached by the Ld. AO which indicates that there was no lack of inquiry by the Ld. AO. In the circumstances, it is submitted that, the same amounts to substituting the judgement of the Ld. AO, which ... case of CIT vs Sunbeam Auto Ltd., reported in 227 CTR 133, wherein the Hon’ble Delhi High Court drew a distinction between “Lack of inquiry” and “inadequate enquiry” and held that in the case of inadequate enquiry, provisions under section 263 cannot be invoked. In our opinion

Shri Ravindrakumar Hiralal Shah, Visanagar vs. The Pr. CIT-3, Ahmedabad

In the result, the appeal filed by the Assessee is allowed

ITA 152/AHD/2021[2016-17]Status: DisposedITAT Ahmedabad23 Nov 2022AY 2016-17

Bench: The Tribunal. This Appeal Is Filed On 01.06.2021 During The Covid-19, Corona Period. The Hon’Ble Supreme Court In Suo Motu Writ Petition (C) No. 3 Of 2020 & In M.A. No. 29 Of 2022 Dated 10.01.2022 Extend By The Period Of Limitation From 15.03.2020 Till 28.02.2022. Thus, There Is No Delay In Filing The Appeal Before The Tribunal.

For Appellant: Shri S.N. Divatia, A.RFor Respondent: Shri James Kurian, CIT-DR

Section 133(6)Section 143(2)Section 143(3)Section 263

prejudicial to the revenue and such an order cannot be the basis of revision under section 263. [7] There is distinction between lack of inquiry and inadequate inquiry. If there was any inquiry, even inadequate, that would not by itself give occasion to Commissioner to pass orders under section ... merely because he had different opinion in the matter. It only in case of lack of inquiry that such a course of action would be open. I hope your goodself is satisfied with the aforesaid information and explanation in this regard and earnestly urge your goodself to kindly drop

Shyam Sunder Verma, Bhopal vs. Pr. CIT -2, Bhopal

In the result, the appeal of the assessee is allowed

ITA 993/IND/2019[2015-16]Status: DisposedITAT Indore22 Nov 2022AY 2015-16

For Appellant: NoneFor Respondent: Shri P.K. Mitra, CIT-D.R

Section 194CSection 263Section 26A

Delhi High Court in the case of CIT Vs. Sunbeam Auto 332 ITR 167 (Del.), made a distinction between lack of inquiry and inadequate inquiry. The Hon’ble court held that where the AO has made inquiry prior to the completion of assessment, the same cannot be set aside ... revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between “lack of inquiry” and “inadequate inquiry”. If there was any inquiry, even inadequate, that would not by itself, give occasion to the Commissioner to pass orders under section

Rk Infra & Engineering India Private Limited, Hyderabad vs. Income Tax Officer, Ward-3, Hyderabad

In the result, the appeal filed by the assessee is dismissed

ITA 188/HYD/2020[2015-16]Status: DisposedITAT Hyderabad22 Nov 2022AY 2015-16

Bench: Shri R.K. Panda & Shri Laliet Kumarassessment Year: 2015-16 R.K. Infra & Engineering India Vs. Income Tax Officer, Private Limited, Ward – 3, Hyderabad. Hyderabad. Pan : Aadcr9570Q (Appellant) (Respondent) Assessee By: Shri Pawan Kumar Chakrapani Revenue By: Shri Jeevan Lal Lavidiya Date Of Hearing: 21.11.2022 Date Of Pronouncement: 22.11.2022

For Appellant: Shri Pawan Kumar ChakrapaniFor Respondent: Shri Jeevan Lal Lavidiya

Section 143(3)Section 263

that the order passed is erroneous and prejudicial to the interest of the revenue. 8.5 It is submitted further that there was no lack of inquiry or inadequate inquiry by the learned assessing officer while passing the order of assessment under section 143[3] of the Act. For the purposes

Shri Dinesh Chhaganlal Thakkar, Ahmedabad vs. The Pr. CIT-1, Ahmedabad

In the result, the appeal filed by the assessee is allowed

ITA 51/AHD/2022[2015-16]Status: DisposedITAT Ahmedabad21 Nov 2022AY 2015-16

Bench: Shri Waseem Ahmed & Ms. Madhumita Royआयकर अपील सं./Ita No. 51/Ahd/2020 िनधा"रण वष"/Asstt. Year: 2015-2016

For Appellant: Shri S.N. Soparkar, Sr. Advocate with Shri Parin Shah, A.RFor Respondent: Shri Vijay Kumar Jaiswal, CIT. DR

Section 10(38)Section 142(1)Section 143(3)Section 263

this regard. 10.11 Delhi High Court in the case of CIT Vs. Sunbeam Auto 332 ITR 167 (Del.), made a distinction between lack of inquiry and inadequate inquiry. The Asstt. Year 2015-16 10 Hon’ble court held that where the AO has made inquiry prior to the completion ... Assessing Officer should have made further inquires rather than accepting the explanation. Therefore, it cannot be said that it is a case of ‘lack of inquiry’.” 10.12 The Hon’ble Bombay High Court in case of Gabriel India Ltd. [1993] 203 ITR 108 (Bom), discussed the law on this aspect

M/S. Embassy Property Developments Private Limited, Bangalore vs. The Principal Commissioner of Income-Tax, (Central), Bangalore

In the result, the appeal filed by the assessee is allowed

ITA 445/BANG/2022[2017-18]Status: DisposedITAT Bangalore21 Nov 2022AY 2017-18

For Appellant: Shri Sriram Seshadri, CAFor Respondent: Ms. Neera Malhotra, CIT-DR

Section 147Section 17Section 2(22)(e)Section 263Section 37

revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between "lack of inquiry" and "inadequate inquiry". If there was any inquiry, even inadequate, that would not by itself, give occasion to the Commissioner to pass orders under section ... merely because he has different opinion in the matter. It is only in cases of "lack of inquiry", that such a course of action would be open. In Gabriel India Ltd.'s case (supra), law on this aspect was discussed in the following manner : ". . . From a reading of sub-section