Date Of Decision: October 5 , 2017 v. The Hon’ble Mr. Justice Sanjay Karol, Acting Chief Justice. The Hon’ble Mr. Justice Sandeep Sharma, Judge. Whether Approved For Reporting? Yes

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA ITA No.4 of 2017 Reserved on: September 21, 2017 Date of Decision: October 5 , 2017 Shri Virbhadra Singh (HUF) through its Karta Shri Virbhadra Singh …Appellant. versus Principal Commissioner of Income Tax …Respondent. Coram: The Hon’ble Mr. Justice Sanjay Karol, Acting Chief Justice. The Hon’ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting? Yes. For the Appellant :Mr.P.Chidambaram, Sr.Advocate, with M/s Rohit Jain, Vishal Mohan, Pranay Pratap Singh, S. Khurana, Aditya Sood and Sushant Kaprate, Advocates. For the Respondent : Mr. Vinay Kuthiala, Senior Advocate with Ms Vandana Kuthiala & Mr. Diwan Singh, Advocates. Sanjay Karol, Acting Chief Justice By way of present appeal, so filed under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act), appellant Shri Virbhadra Singh (HUF) (hereinafter referred to as the Assessee), lays challenge to the order dated 8.12.2016 (Annexure A-1), passed by the Income Tax Appellate Tribunal (hereinafter referred to as the Tribunal), affirming the order dated 18.3.2014 (Annexure A-2), passed by the Commissioner of Income Tax (hereinafter referred to as the Commissioner), who set aside the order dated 28.3.2013 (Annexure A-4) (Page-276), passed by the Assessing Officer, in accepting the Revised Return filed by the Assessee. 2.Parties agreed for admission of the appeal on the following Substantial Questions of Law, which we are called upon to decide: “i) Whether on the facts and in the circumstances of the case, the Tribunal erred in law in upholding the validity of the revisionary order dated 18.03.2014 passed under section 263 of the Act? ii) Whether on the facts and in the circumstances of the case, the impugned order of the Tribunal dated 8.12.2016 admitting and considering the additional evidences in gross violation of the procedure laid down in ITAT Rules and in violation of principles of natural justice and fair play, is illegal and bad in law?” 3.The facts, leading to the filing of the instant appeal are as under. 4.The Assessee is regularly assessed to income tax. On 19.7.2010, Assessee filed a Return, declaring net taxable income, for the Financial Year 2009-2010 - Assessment Year 2010-2011 (hereinafter referred to as the relevant year) to be `7,22,943/- (Page-262). In the said Return, income from the source of agriculture, germane to present proceedings, he disclosed a sum of `15,00,000/-. Perusal of the Return (Page-265) reveals the Assessee to have also generated income from the source of LIC. 5.Such return was selected for scrutiny assessment through CASS. Hence, on 24.8.2011, statutory notice under Section 143(2) of the Act was issued. 6.However, on 2.3.2012, Assessee filed a Revised Return, declaring his income from the agricultural source (hereinafter referred to as “agricultural source”), enhancing it from `15,00,000/- to `2,80,92,500/- (Page-265). 7.Vide order dated 28.3.2013 (Annexure A-4) (Page-276) (hereinafter referred to as the assessment order), the Assessing Officer, in deciding the proceedings for assessment under Section 143(3) of the Act, accepted the income so declared by the Assessee. 8.On 12.2.2013, the Commissioner, by invoking revisional jurisdiction, under Section 263 of the Act, issued notice to the Assessee (Annexure A-5) (Page-282), and after affording opportunity of hearing, vide impugned order dated 18.3.2014 (Annexure A-2) (Page 203), set aside the assessment order, holding it to be erroneous as well as prejudicial to the interest of Revenue and remanded the matter back for fresh assessment in accordance with law. 9.Sometime in the month of May/June, 2014, Assessee laid challenge to the same by filing a statutory appeal before the Tribunal, which stands dismissed vide impugned order dated 8.12.2016 (Annexure A-1) (Page-70). It is a matter of record that during the course of such proceedings, Revenue placed additional material, which was considered in deciding/dismissing the appeal. and after affording opportunity of hearing, vide impugned order dated 18.3.2014 (Annexure A-2) (Page 203), set aside the assessment order, holding it to be erroneous as well as prejudicial to the interest of Revenue and remanded the matter back for fresh assessment in accordance with law. 9.Sometime in the month of May/June, 2014, Assessee laid challenge to the same by filing a statutory appeal before the Tribunal, which stands dismissed vide impugned order dated 8.12.2016 (Annexure A-1) (Page-70). It is a matter of record that during the course of such proceedings, Revenue placed additional material, which was considered in deciding/dismissing the appeal. 10.Prior thereto, pursuant to the order of remand, the authorized Assessing Officer, vide order dated 31.3.2015 (Page-574) re-assessed the income from the agricultural source, by concluding that: “14. Finally by the all possible exercises and enquiries, I conclude that most reasonably the orchard would have produced apple crops after setting off the expenses incurred for earning the said agriculture income, the net agriculture income of Rs.15,00,000/- as per the original return of income filed by the assessee on 29.07.2010. I also conclude that the alleged MoU dated 15.06.2008 is a false and fabricated document which was prepared later by the assessee as an afterthought. 15. In view of the above, I treat the income (which has been declared as additional agricultural income in the revised return) of Rs.2,65,82,500/- as income earned from undisclosed sources and add this amount u/s 68 of the Income Tax Act 1961 to the taxable income of the assessee. 16. Further, keeping in view the discussions as above, I am satisfied that the assessee hasfurnished inaccurate particulars of his income amounting of Rs.2,65,82,550/-and has suppressed his taxable income by -Rs.2,65,92,550/ therefore, penalty proceedingsu/s 271(1)(c) of the Income Tax Act, 1961 arebeing initiated separately. 17. With above remarks the taxable income of the assessee is computed as under: (All figures in INR)Taxable income as declared by Rs.44,67,584/- the assessee. Add Income from undisclosed Rs.2,65,92,550/- sourced as discussed para 15 Taxable Income Rs.3,10,60,134/- -Agriculture income is assessed at Rs.15,00,000/as per original return filed on 29.07.2010.” (Emphasis supplied) 11. It is a matter of record that now such order of assessment is pending adjudication before the Commissioner of Income Tax (Appeals). 12.However, pursuant to order of re-assessment and pending consideration of said appeal, Assessee filed the instant appeal on 18.1.2017, in which notice was issued on 20.1.2017. 13. Parties insisted on the hearing of the appeal and as such, they have addressed on various issues touching the substantial questions of law. 14.On behalf of the Assessee, Mr.P.Chidambaram, learned Senior Counsel, argued: (a)View taken by the Assessing Officer was a possible and plausible one. Simply because the Commissioner disagreed with the same, it was not open for him to have exercised his revisional jurisdiction, a possible and plausible one. Simply because the Commissioner disagreed with the same, it was not open for him to have exercised his revisional jurisdiction, more so, without satisfying and recording the order being erroneous and prejudicial to the interest of Revenue. recording the order being erroneous and prejudicial to the interest of Revenue. (b)In the alternative, having satisfied about the order being erroneous, rather than remitting the matter, the Commissioner himself, ought to have conducted the inquiry as it was not a case of “no inquiry” but “some inquiry”. the order being erroneous, rather than remitting the matter, the Commissioner himself, ought to have conducted the inquiry as it was not a case of “no inquiry” but “some inquiry”. (c)While examining the correctness of jurisdiction exercised by the Commissioner, Tribunal erred in accepting and considering additional jurisdiction exercised by the Commissioner, Tribunal erred in accepting and considering additional (b)In the alternative, having satisfied about the order being erroneous, rather than remitting the matter, the Commissioner himself, ought to have conducted the inquiry as it was not a case of “no inquiry” but “some inquiry”. the order being erroneous, rather than remitting the matter, the Commissioner himself, ought to have conducted the inquiry as it was not a case of “no inquiry” but “some inquiry”. (c)While examining the correctness of jurisdiction exercised by the Commissioner, Tribunal erred in accepting and considering additional jurisdiction exercised by the Commissioner, Tribunal erred in accepting and considering additional evidence placed on record by the Revenue. (d)Still further, Tribunal erred in accepting such additional evidence, for (a) it was in gross violation of Rule-29 of the Income Tax Rules, 1962, (b) additional evidence was allowed without passing a separate speaking order, (c) no opportunity to rebut the same was afforded to the Assessee, and (d) no opportunity was afforded to the Assessee to cross-examine the person whose statements were accepted by the Tribunal. 15. 15.At this juncture, this Court feels obliged to reproduce the note handed over by Mr. Chidambaram, learned Senior Counsel, termed as “Legal Propositions”, restricting the grounds of challenge and the issues arising for consideration in the present appeal: “Proposition I: Section 263 of the Income Tax Act, 1961 (“the Act”) permits the CIT to revise the order only if it is: (a)Erroneous; and (b)Prejudicial to the interest of Revenue. If the assessing officer takes a plausible view, the CIT cannot hold that order to be erroneous merely because he disagrees with that view. In the present case, first condition, viz. order being “erroneous” is not satisfied. Proposition II: Without prejudice to proposition (I), in a case where the CIT has correctly come to the conclusion that the order is erroneous but there is some enquiry by the assessing officer, then the CIT cannot remit the matter to the assessing officer but he should decide it himself. Remit is permissible only in a case of no enquiry. Proposition III: The Appellate Tribunal (ITAT) was obliged to examine the correctness of the exercise of jurisdiction by the CIT under section 263 of the Act; in such a case rule permitting filing of additional evidence does not apply. In the present case, ITAT erred in permitting the additional evidence while examining the correctness of jurisdiction of the CIT under section 263 of the Act. Proposition IV: Without prejudice to proposition III, the ITAT erred in permitting new and additional evidence because it was: (a)in gross violation of Rule 29 of the ITAT Rules; ITAT Rules; (b)without passing a separate speaking order allowing the additional evidence; order allowing the additional evidence; (c)without granting opportunity to the appellant to rebut the additional evidence or to cross-examine the person making ex-parte statements.” appellant to rebut the additional evidence or to cross-examine the person making ex-parte statements.” 16. In support, reliance is sought on the following decisions rendered by different Courts of the land: (1) Malabar Industrial Co. Ltd. v. Commissioner of Income Tax, Kerala State, (2000) 2 SCC 718; (2) Commissioner of Income Tax v. Kwality Steel Suppliers Complex, (2017) 395 ITR 1 : AIR 2017 SC 2949; (3) Commissioner of Income Tax v. Gabriel India Ltd., (1993) 203 ITR 108; (4)Commissioner of Income-Tax v. Sunbeam Auto Ltd., (2011) 332 ITR 167; (5) Income-Tax Officer v. DG Housing Projects Ltd., (2012) 343 ITR 329; (6) Commissioner of Income-Tax v. Text Hundered India Pvt. Ltd., (2013) 351 ITR 57; (7) Maruti Udyog Limited V. ITAT, (2000) 244 ITR 303 (Delhi) and (8) Andaman timber Industries v. Commissioner of Central Excise, Kolkata-II, (2015) 281 CTR 241 : (2016) 15 SCC 785. 16. In support, reliance is sought on the following decisions rendered by different Courts of the land: (1) Malabar Industrial Co. Ltd. v. Commissioner of Income Tax, Kerala State, (2000) 2 SCC 718; (2) Commissioner of Income Tax v. Kwality Steel Suppliers Complex, (2017) 395 ITR 1 : AIR 2017 SC 2949; (3) Commissioner of Income Tax v. Gabriel India Ltd., (1993) 203 ITR 108; (4)Commissioner of Income-Tax v. Sunbeam Auto Ltd., (2011) 332 ITR 167; (5) Income-Tax Officer v. DG Housing Projects Ltd., (2012) 343 ITR 329; (6) Commissioner of Income-Tax v. Text Hundered India Pvt. Ltd., (2013) 351 ITR 57; (7) Maruti Udyog Limited V. ITAT, (2000) 244 ITR 303 (Delhi) and (8) Andaman timber Industries v. Commissioner of Central Excise, Kolkata-II, (2015) 281 CTR 241 : (2016) 15 SCC 785. 17.In addition, Mr. Vishal Mohan, learned Counsel, has argued that in deciding the appeal, Tribunal ought to have confined consideration only to the material on record, so defined under clause (b) of sub-section (1) of Section 263 of the Act. 18.On the other hand, Mr. Vinay Kuthiala, learned Senior Counsel appearing for the Revenue, with vehemence defends the action inter alia contending that (a) the impugned orders passed are strictly in accordance with law, (b) present appeal merits rejection in limine, for the Assessee, who is forum shopping, is guilty of suppressio veri, expressio falsi (c) similar issues based on similar facts already stand adjudicated by this Court in Shri Virbhadra Singh v. Deputy Commissioner, Circle Shimla, CWP No.3072 of 2016, decided on 26.12.2016 (d) alternate remedy already stands exhausted by the assessee and, as such, cannot be allowed to pursue the present appeal. 19.Reliance is sought on the following reports: (1) K. Venkataramkiah v. A. Seetharma Reddy and others,AIR 1963 SC 1526; (2) Smt. Tara Devi Aggarwal v. Commissioner of Income-Tax, West Bengal, (1973) 88 ITR 323 : (1973) 3 SCC 482; (3) Syed Abdul Khader v. Rami Reddy and others, AIR 1979 SC 553; (4) State of Rajasthan v. T.N. Sahani and others, (2001) 10 SCC 619; (5) Thakur V. Hari Prasad v. Commissioner of Income-Tax,(1987) 167 ITR 603; (6) T.M.S. Mohamed Abdul Kader v. Commissioner of Gift-Tax, Madras, (1968) 70 ITR 237(Madras); (7) Commissioner of Income Tax v. Emery Stone Mfg. Co., (1995) 213 ITR 843 (Rajasthan); (8) Sunanda Ram Deka v. Commissioner of Income-Tax,(1994) 210 ITR 988; (9) Amjad Ali Nazir Ali v. Commissioner of Income-Tax, Kanpur, (1977) 110 ITR 419(Allahabad); (10) Addl. Commissioner of Income-Tax, Lucknow v. Radhey Shyam, (1980) 123 ITR 125 (Allahabad); (11) Sasi Enterprises v. Assistant Commissioner of Income Tax, (2014) 5 SCC 139 and (12) Commissioner of Income Tax, Mumbai v. Amitabh Bachhan, (2016) 11 SCC 748. 20.We shall first deal with the preliminary objections. 21.With vehemence, Mr. Kuthiala, learned Senior Counsel, has highlighted the conduct of the Assessee, who, according to the Revenue, has not only tried to procrastinate the proceedings of assessment but suppressed, misled and mis-stated true facts. Also, an endeavour is made to resort to multiple proceedings and remedies, with a view to confuse the issue and abuse the process of law. Our attention is invited to the fact that in the present appeal, Assessee failed to disclose that against the order of remand dated 18.3.2014, though an appeal was filed but no application seeking stay of the order passed by the Commissioner was filed. For more than one and a half years, hearing of the appeal was allowed to be delayed. In the meanwhile, a fresh order pursuant to remand was passed, against which also an appeal was preferred. Though the appellant could have sought stay of the proceedings but deliberately chose not to do so, for he was forum hunting. By taking a calculated risk, in fact as a gamble, he waited for the authorities to pass an order. Now finding the same not to his liking, he has pursued the appeal, and that too without disclosing such facts. As such, he is guilty of suppressio veri, expressio falsi. Reference is made to Sasi Enterprises (supra). pass an order. Now finding the same not to his liking, he has pursued the appeal, and that too without disclosing such facts. As such, he is guilty of suppressio veri, expressio falsi. Reference is made to Sasi Enterprises (supra). 22.Well, we are not inclined to dismiss the appeal on this count, for we have endeavoured to answer the issues on merit. 23.It is next contended that the grounds raised in the present appeal can be considered and adjudicated in the appeal already preferred by the Assessee, assailing fresh order of assessment (re-assessment) passed by the Assessing Officer. Also we are not inclined to dismiss the appeal on this count. 24.Order passed by the Assessing Officer, being erroneous and prejudicial to the interests of the Revenue, cannot be agitated by the Assessee in the pending proceedings, assailing the order passed pursuant to an order of remand. 25.This Court in Shri Virbhadra Singh v. Deputy Commissioner, Circle Shimla, CWP No.3072 of 2016 has only considered the legality and propriety of issuance of notices under Sections 147 & 148 of the Act. Hence, findings returned therein cannot be said to be in the nature of res judicata. 26.As such, uninfluenced of the preliminary objections, we proceed to examine the appeal on merits. 27.For adjudicating relevant statutory provisions, Sections 139, 142, 143, 147, 263, 254 of the Act and Rule 29 of the Income Tax Rules, 1962 (hereinafter referred to as the Rules) need to be examined. 28.Section 139 of the Act casts an obligation on every person, specified therein, to furnish return of his income, in a prescribed manner. Law provides (sub-section (5) of Section 139) that wherever an Assessee “discovers any omission or any wrong statement” in an already furnished return, he may furnish a revised return, within the period of limitation prescribed therein. 29.Section 142 of the Act postulates an inquiry before assessment. 30.Assessment is carried out in terms of Section 143. 31.Under Section 147 of the Act, the Assessing Officer, if he has reason to believe that any income chargeable to tax has escaped assessment for the Assessment Year, may subject to all just exceptions, assess or reassess such income. 32.Under Section 263 of the Act, the Commissioner is empowered to call for and examine the record of any proceedings under the Act and on consideration, if the order passed by the Assessing Officer is found to be erroneous, insofar as it is prejudicial to the interest of Revenue, may, after giving the Assessee an opportunity of hearing and making or causing to make such inquiry, as may be deemed necessary, pass any order, enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment. 33.Clause (b) of sub-section (1) of Section 263 of the Act itself defines “record” to mean that record shall include and be deemed always to have included all records relating to any proceeding under the Act available at the time of examination by the Principal Commissioner or Commissioner. 34.Further remedy is by way of an appeal to the Tribunal (Sections 253/254) and thereafter an appeal, on a substantial question of law, to the High Court under the provisions of Section 260A of the Act. Certain Facts 35.It is a matter of record that in relation to three Assessment Years, i.e. 2008, 2009 and 2011, the Assessee and his family members made investments in the policies of Life Insurance Corporation (LIC) worth `6.18 crores. It is also an undisputed fact that in the relevant year (2009-10), Assessee and his family members made investments in purchase of LIC Policies for an amount, in excess of the income declared from the agricultural source in the relevant year. Following are such investments indicated in a tabulated form: “Relevant year” 36.On 19.7.2010, Assessee did not disclose such fact and declared his income from agricultural source to be `15,00,000/-. In the Revised Return filed on 2.3.2012, such income was declared to be `2,80,82,500/-. Certain Facts 35.It is a matter of record that in relation to three Assessment Years, i.e. 2008, 2009 and 2011, the Assessee and his family members made investments in the policies of Life Insurance Corporation (LIC) worth `6.18 crores. It is also an undisputed fact that in the relevant year (2009-10), Assessee and his family members made investments in purchase of LIC Policies for an amount, in excess of the income declared from the agricultural source in the relevant year. Following are such investments indicated in a tabulated form: “Relevant year” 36.On 19.7.2010, Assessee did not disclose such fact and declared his income from agricultural source to be `15,00,000/-. In the Revised Return filed on 2.3.2012, such income was declared to be `2,80,82,500/-. 37.Perusal of the order of the Assessing Officer, reveals the Assessee to have taken the following stand– (a) he is owner of agricultural land, i.e. orchard known as Shrikhand Orchard; (b) vide agreement dated 15.6.2008, he appointed Shri Anand Chauhan as his Agent to manage it for a period of three years; (c) consideration being payment of commission @ 2% on net sale proceeds, after deduction of all expenses; (d) said Agent stood authorized to make investments of the sale proceeds in Government securities, mutual funds, schemes of LIC; (e) which was actually so done by him; (f) In the year 2011-12, when accounts were settled, professional advise was sought and (g) since there was no regular assessment and there being a “mistake/defect/omission” in the original return, a revised return was filed within the stipulated period of time. 38.The Assessing Officer has observed that: (a) notices were issued to the Agent who appeared and placed on record documents i.e. (i) his Income Tax Return for the relevant year, (ii) copies of account of gross apple receipts for the relevant year, and (iii) copies of bills of sale proceeds of horticulture produce issued by the vendor, i.e. M/s Universal Apple Association, Parwanoo; also explained the shortfall in the income, in the relevant year, matching it with the investment made in the LIC, to be routed through one Shri M.R. Chauhan (such amount is more than `1 crore); and (b) information with respect to assessment proceedings of the Agent was sought for verification from his Assessing Officers. 39.Thus, finding the Assessee to have “established that the agriculture income disclosed in the revised return of income” “pertains to the sale proceeds of horticulture” and the same to have “been invested” by the Agent “in LIC policies in the names of members of the HUF, as per the terms and conditions of the M.O.U”, the Assessing Officer accepted the revised return. 40.One additional important fact. Between the date of filing of Revised Return (2.3.2012) and passing of the assessment order (28.3.2013), certain directions were issued by a Superior Officer, i.e. Additional Commissioner, on 1.2.2013 and 7.2.2013, in the capacity of a Supervisory Officer. Also, on 25.10.2012, notices were issued to the Assessee, seeking clarifications. 41.Let us examine what weighed with the Commissioner in finding the Assessing Officer not to have made “effective inquiry” or the “mistake and the omission” that of the Assessee in the original return to be not bonafide, in setting aside the order of assessment. 40.One additional important fact. Between the date of filing of Revised Return (2.3.2012) and passing of the assessment order (28.3.2013), certain directions were issued by a Superior Officer, i.e. Additional Commissioner, on 1.2.2013 and 7.2.2013, in the capacity of a Supervisory Officer. Also, on 25.10.2012, notices were issued to the Assessee, seeking clarifications. 41.Let us examine what weighed with the Commissioner in finding the Assessing Officer not to have made “effective inquiry” or the “mistake and the omission” that of the Assessee in the original return to be not bonafide, in setting aside the order of assessment. 42.The Commissioner found the order passed by the Assessing Officer to be erroneous as well as prejudicial to the interests of Revenue, inter alia, on the ground that– (a) earning of additional income of `2.65 crore, so reflected in the Revised Return, was already within the knowledge of the Assessee, (b) it is not a case of bonafide omission, (c) the Assessing Officer failed to inquire from the Assessee, the source of `1.19 crore, an amount in excess of the income of `2.65 crore (approximately) from the agricultural source, (d) no inquiry was conducted for ascertaining the authenticity of the bills, vouchers, books of account of the income, (e) inquiry conducted was “invalid”, inasmuch as the Assessing Officer “blindly accepted” the “version of the Assessee’s Agent” and (f) the income appeared to be disproportionately high as compared to the income from the said source in relation to the preceding and the succeeding years. 43.At this juncture, it be only observed that entire sale of horticulture produce of more than `2.8 crore is in cash. This fact is not disputed. 44.Further, it be kept in mind that the Assessee and his family members appeared to be fully aware of the income from agricultural source, for after all policies were purchased not in the name of the Agent, in an escrow account, for and on behalf of the Assessee, but in the name of the Assessee and his family members. After all, for purchase of such policies of huge amounts, requisite formalities are required to be completed by the applicant (purchaser of the policy). It is not the case of Assessee that anyone of his family members is a minor or that no forms were filled up by the respective purchasers. 45.What is contended is that in relation to the income in question, Assessee was adopting mercantile system of accounting and as such exact amount of income could be ascertained only with the settlement of account, after a period of three years, which was sometime in the month of September, 2011. 46.At this juncture, one fact, which is not disputed, to which our attention is invited by the Revenue, is that in relation to the years preceding and succeeding to the relevant year, income from agricultural source, is marginal, bordering what was originally declared by the Assessee. Income, grossly disproportionate is only with respect to the relevant year. 47.As we have already observed, in the instant case, Assessee did file his return, under Section 139 of the Act. However, only when notice under Section 143(2) was issued, he filed a revised return, in exercise of his right under sub-section (5) of Section 139, which came to be assessed, under Section 143(3) of the Act. 48.The Assessee was satisfied with such assessment and as such did not take recourse to remedies provided under the Act. 49.But however, in exercise of his revisional jurisdiction, the Commissioner initiated proceedings for revising such order. In his wisdom, Commissioner found the order passed by the Assessing Officer to be “erroneous”, for it being “prejudicial to the interests of Revenue”. He did not find the Assessee to have revised his return “on the basis of discovery” or “omission” or “any wrong statement therein”. 50.Hence, we are concerned with the meaning of expressions “erroneous”; “prejudicial to the interests of Revenue”; “discovery”; or “omission”. 48.The Assessee was satisfied with such assessment and as such did not take recourse to remedies provided under the Act. 49.But however, in exercise of his revisional jurisdiction, the Commissioner initiated proceedings for revising such order. In his wisdom, Commissioner found the order passed by the Assessing Officer to be “erroneous”, for it being “prejudicial to the interests of Revenue”. He did not find the Assessee to have revised his return “on the basis of discovery” or “omission” or “any wrong statement therein”. 50.Hence, we are concerned with the meaning of expressions “erroneous”; “prejudicial to the interests of Revenue”; “discovery”; or “omission”. 51.At this juncture, we may also observe that we are also concerned with the power of the Tribunal. Is it circumscribed to be the one exercised by the Commissioner, restricting it to the “record” so available at the time of examination or is it that the Tribunal can allow any party to adduce additional material, which can be considered for just decision of the appeal. 52. At this point in time, we deem it appropriate to first discuss the law referred to and certain other decisions dealing with the interpretation and application of Sections 139 and 263 of the Act. Discovery of omission in filing a Revised Return underSection 139(5) 53.A Division Bench of the Allahabad High Court, in Amjad Ali Nazir Ali (supra), has held as under: “It will be seen that so far as revised returns are concerned, the provisions under the old Act and the new Act are in pari materia. Now, after the decision of the Supreme Court in Commissioner of Income-tax v. S. Raman Chettiar [1965] 55 ITR 630 (SC), there cannot be any doubt that the revised return is also a return under Section 22 of the Indian Income-tax Act. Since the language of Section 139(5) of the new Act is in pari materia, it must be held that the revised return filed under Section 139(5) is a return contemplated by Section 139. But the question is whether the filing of the revised return obliterates the original return. S. Raman Chettiar's case [1965] 55 ITR 630 (SC) does not throw light on this controversy. In order to answer the question posed, it will be useful to concentrate on the language of Section 139(5) of the Act. It is apparent that a revised return can be filed only where any person discovers any omission or any wrong statement therein. The use of the word "discovers", in our view, connotes discovery of some omission or wrong statement in the return, of which theassessee was not aware at the time of filing of the original return. It cannot cover a case where theomission or wrong statement contained in the first return is deliberate, for, in that case, it cannot besaid that the revised return was filed by theassessee on discovery of any omission or wrong statement, as he would all the time haveknowledge of the omission or wrong statement inthe original return. This being so, on the language of Section 139(5), an assessee who had deliberately made any omission or wrong statement in his original return cannot avail himself of the advantage given by this subsection of filing a revised return. In cases where an assessee has deliberately omitted particulars of his income or made wrong statement in the return, the revised return filed by him would be outside the pale of section 139(5) of the Act, and it would not be a revised return as contemplated by the Act. Once this position is reached the question of considering the revised return for the purposes of penalty would hardly arise, for, in the eye of law, there would be no revised return as contemplated by Section 139(5). Such a revised return cannot supplant the original return and, for the purposes of penalty, it will be only the original return that will have to be looked into.” [Emphasis supplied] 54.This view stands reiterated in Commissioner of Income Tax, Delhi (Central) vs. S. Sucha Singh Anand, [Emphasis supplied] 54.This view stands reiterated in Commissioner of Income Tax, Delhi (Central) vs. S. Sucha Singh Anand, (1984)149 ITR 143 (Delhi) (Two-Judge Bench). In fact in Sunanda Ram Deka (Two-Judge Bench) (supra), the Court observed that “In our opinion, the further requirement is that this omission or wrong statement in the original return must be due to a bona fide inadvertence or mistake on the part of the assessee.” 55.In Radhey Shyam (supra), the Allahabad High Court, has held that non-disclosure of correct income, due to gross or willful negligence on the part of the Assessee would not entitle him to file revised returns, requiring assessment in accordance with law. 56.In Commissioner of Income Tax v. Dr. Sajjan Singh Malik, (1989) 178 ITR 643, the Punjab & Haryana High Court, in a case where the total income returned by the Assessee was less than 80%, the Court presumed that the Assessee had failed to rebut the presumption that he had failed to disclose the income in accordance with law. SCOPE OF SECTION 263 OF THE ACT 57.The Apex Court (three-Judge Bench) in Smt. Tara Devi Aggarwal (supra), has clarified that: “………The words of the section enable the Commissioner to call for and examine the record of any proceeding under the Act and to pass such orders as he deems necessary as the circumstances of the case justify when heconsiders the order passed was erroneous in so far as it is prejudicial to the interests of therevenue.It is not, as submitted by the learned advocate, prejudicial to the interests of the revenue only if it is found that the assessment for the year was disclosed (sic) on the basis that an income had been earned which is assessable. Even where an income has not been earned and is not assessable, merely because the assesseewants it to be assessed in his or her hands in order to enable someone else who would have been assessed to a larger amount an assessment so made can certainly be erroneous and prejudicialto the interests of the revenue. It so-and we think it is so-the Commissioner under S. 33B has ample jurisdiction to cancel the assessment and may initiate proceedings for assessment under the provisions of the Act against some other assessee who according to the income-tax authorities is liable for the income thereof……….” [Emphasis supplied] 58. The Apex Court in Kwality Steel Suppliers Complex (supra), while reiterating the aforesaid principle, clarified that in exercise of its revisional jurisdiction, Commissioner must exercise proper application of mind. In the given facts, Court found the view taken by the Assessing Officer to be a plausible one, inasmuch as family business, with the death of one of the partners continued to be carried on by the son of the deceased with his mother being another partner, accepting the book value of the stock-in-trade to be plausible and permissible view. 59. 59.A Division Bench of the Rajasthan High Court, in Emery Stone Mfg. Co. (supra), has observed that simply because facts were disclosed by the Assessee, it would not give immunity from exercise of any revisional jurisdiction, which the Commissioner can exercise in the amplitude of his statutory powers. 60.Mr. Chidambaram, learned Senior Counsel, invites our attention to the decision rendered by the High Court of Bombay in Gabriel India Ltd. (supra), wherein the Court held the term “erroneous” to mean deviating from law. We lay emphasis on portions extracted hereunder: “… … … According to the definition, “erroneous” means “involving error’ deviating from the law”. “Erroneous assessment” refers to an assessment that deviates from the law and is, therefore, invalid, and is a defect that is jurisdictional in its nature, and does not refer to the judgment of the Assessing Officer in fixing the amount of valuation of the property. Similarly, “erroneous judgment” means “one rendered according to course and practice of court, but contrary to law, upon mistaken view of law, or upon erroneous application of legal principles”. “… … … According to the definition, “erroneous” means “involving error’ deviating from the law”. “Erroneous assessment” refers to an assessment that deviates from the law and is, therefore, invalid, and is a defect that is jurisdictional in its nature, and does not refer to the judgment of the Assessing Officer in fixing the amount of valuation of the property. Similarly, “erroneous judgment” means “one rendered according to course and practice of court, but contrary to law, upon mistaken view of law, or upon erroneous application of legal principles”. From the aforesaid definition it is clear that an order cannot be termed as erroneous unless it is not in accordance with law. If an Income-tax Officer acting in accordance with law makes a certain assessment, the same cannot be branded as erroneous by the Commissioner simply because, according to him, the order should have been written more elaborately. This section does not visualize a case of substitution of the judgment of the Commissioner for that of the Income-tax Officer, who passed the order, unless the decision is held to be erroneous. Cases may be visualised where the Income-tax Officer while making an assessment examines the accounts, makes enquiries, applies his mind to the facts and circumstances of the case and determines the income either by accepting the accounts or by making some estimate himself. The Commissioner, on perusal of the records, may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the Commissioner he would have estimated the income at a figure higher than the one determined by the Income-tax Officer. That would not vest the Commissioner with power to re-examine the accounts and determine the income himself at a higher figure. It is because the Income-tax Officer has exercised the quasi-judicial power vested in him in accordance with law and arrived at a conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. It may be said in such a case that in the opinion of the Commissioner the order in question is prejudicial to the interest of the Revenue. But that by itself will not be enough to vest the Commissioner with the power of suo motu revision because the first requirement, viz., that the order is erroneous, is absent. 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.” 61.In Commissioner of Income-Tax v. Vikas Polymers, (2012) 341 ITR 537(Delhi), Court reiterated the principle of order of the Commissioner fulfilling the twin test of revising the order passed by the Assessing Officer. 61.In Commissioner of Income-Tax v. Vikas Polymers, (2012) 341 ITR 537(Delhi), Court reiterated the principle of order of the Commissioner fulfilling the twin test of revising the order passed by the Assessing Officer. It must be erroneous and prejudicial to the interests of Revenue. The Commissioner can call for and examine the record and by giving an opportunity of hearing make such inquiry as is deemed necessary. The Court, by taking into account the decision referred to by the Bombay High Court in Gabriel India Ltd. (supra), observed, “erroneous” to mean an order which is not in accordance with law. There must be material to show that the tax which was exigible has not been imposed and expression “prejudicial to the interests of the Revenue” to mean the orders of assessment under challenge being not in accordance with law, in consequence whereof the lawful revenue due to the State has not been realized and cannot be realized. It also reiterated the difference between “lack of inquiry” and “inadequate inquiry”. 62.In fact in subsequent decision the very same High Court (Delhi) in Commissioner of Income Tax vs. Ashok Logani, (2012) 347 ITR 22 (Delhi) (Two-Judge Bench) reiterated the view taken by the High Court of Gujarat in CIT vs. Smt. Minalben S. Parikh, (1995) 215 ITR 81 (Guj), as under:- “The words ‘prejudicial to the interests of theRevenue’ has not been defined. However, giving the ordinary meaning to the words used in the statute, they must mean that the orders under consideration are such as are not in accordancewith law and, in consequence whereof, the lawfulrevenue due to the State has not been realized or cannot be realized. The well settled principle in considering the question as to whether an order is prejudicial to the interests of the Revenue or not is to address oneself to the question whether the legitimate revenue due to the exchequer has been realized or not or can be realized or not if theorders under consideration are allowed to stand.For arriving at this conclusion, it becomes necessary and relevant to consider whether the income in respect of which tax is to be realized has been subjected to tax or not or if it is subjected to tax, whether it has been subjected to tax at the rate at which it could yield the maximum revenue in accordance with law or not. If the income in question has been taxed and legitimate revenue due in respect of that income had been realized, though as a result of an erroneous order having been made in that respect, the Commissioner cannot exercise the powers for revising the order under section 263 merely on the basis that the order under consideration is erroneous. If the material in that regard is available on the record of the assessee concerned the Commissioner cannot exercise his power by ignoring that material which links the income concerned with the tax realization made thereon. The two questions are inter-linked and the authority exercising the powers under section 263 is under an obligation to consider the entirematerial about existence of income and the tax which is realizable in accordance with law and further what tax has in fact been realized under the assessment order.” [Emphasis supplied] 63.The ratio and the decision stands reiterated subsequently in Commissioner of Income-Tax v. New Delhi Television Ltd., (2014) 360 ITR 44 (Delhi). thereon. The two questions are inter-linked and the authority exercising the powers under section 263 is under an obligation to consider the entirematerial about existence of income and the tax which is realizable in accordance with law and further what tax has in fact been realized under the assessment order.” [Emphasis supplied] 63.The ratio and the decision stands reiterated subsequently in Commissioner of Income-Tax v. New Delhi Television Ltd., (2014) 360 ITR 44 (Delhi). 64.In Malabar Industrial Co. Ltd. (supra), the Apex Court (two-Judge Bench), clarified that pre-requisite for the Commissioner to suo motu exercise its jurisdiction is that the order of Income Tax Officer is erroneous, insofar as it is prejudicial to the interests of Revenue. The Court laid down twin conditions for the Commissioner to be satisfied – (i) the order sought to be revised is erroneous and (ii) prejudicial to the interests of Revenue. It clarified that the power cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer. What is prejudicial to the interests of Revenue is to be understood in its ordinary meaning, for it is of wide import/amplitude and not confined to loss of tax. Every loss of revenue cannot be treated as prejudicial to the interests of revenue. It clarified that when an Assessing Officer adopts one of the courses permissible in law, which has resulted in loss of revenue or where two views are possible, then difference of opinion cannot be treated as erroneous or prejudicial to the interests of Revenue, unless view taken by the Assessing Officer is unsustainable in law. The Court reiterated that where “a sum not earned by a person is assessed as income in his hands on his so offering, the order passed by the Assessing Officer accepting the same as such will be erroneous and prejudicial to the interests of Revenue”. The principle stands further reiterated in Commissioner of Income Tax (Central) Ludhiana v. Max India Limited, (2007) 15 SCC 401. 65.Mr. Chidambaram also invites our attention to the decision of Delhi High Court in Sunbeam Auto Ltd.(supra), wherein a distinction is cast between “lack of inquiry” and “inadequate inquiry”, clarifying that only in a case of “lack of inquiry”, would the Commissioner be entitled to exercise its revisional jurisdiction. 66.In DG Housing Projects Ltd. (supra), the Delhi High Court has only held that: “18. … … …An order of remit cannot be passed by the CIT to ask the Assessing Officer to decide whether the order was erroneous. This is not permissible. An order is not erroneous, unless the CIT hold and records reasons why it is erroneous. An order will not become erroneous because on remit, the Assessing Officer may decide that the order is erroneous. Therefore CIT must after recording reasons hold that the order is erroneous. The jurisdictional precondition stipulated is that the CIT must come to the conclusion that the order is erroneous and is unsustainable in law.” (Also: Commissioner of Income Tax, Mumbai v. Amitabh Bachhan, (2016) 11 SCC 748) 67.The Apex Court (two-Judge Bench) in Amitabh Bachhan (supra), has held that: “18. … … …An order of remit cannot be passed by the CIT to ask the Assessing Officer to decide whether the order was erroneous. This is not permissible. An order is not erroneous, unless the CIT hold and records reasons why it is erroneous. An order will not become erroneous because on remit, the Assessing Officer may decide that the order is erroneous. Therefore CIT must after recording reasons hold that the order is erroneous. The jurisdictional precondition stipulated is that the CIT must come to the conclusion that the order is erroneous and is unsustainable in law.” (Also: Commissioner of Income Tax, Mumbai v. Amitabh Bachhan, (2016) 11 SCC 748) 67.T