Where at time of passing of assessment order said issue was considered by AO in detail and while passing scrutiny assessment, even otherwise on aforesaid ground it should not be open for Commissioner to exercise powers under Section 263 (of Income Tax Act, 1961)

Now so far as the order passed by the Assessing Officer allowing the assessee to debit Rs.92,66,211/- on obsolete spares and stores and other items written off are concerned, learned Commissioner in exercise of the powers under Section 263 (of Income Tax Act, 1961) has set aside the order passed by the Assessing Officer by observing that the contents of the assessee need detailed examination, which was not done by the Assessing Officer at the time of the assessment proceedings. However, it is required to be noted that at the time of passing of the assessment order the said issue was considered by the Assessing Officer in detail and while passing the scrutiny assessment. Even otherwise on the aforesaid ground it was not open for the Commissioner to exercise the powers under Section 263 (of Income Tax Act, 1961). The aforesaid issue has been dealt with by the learned tribunal by observing in paragraph nos.18 to 24. The learned tribunal has specifically observed after considering the Companies policy and accounting treatment of obsolete spares and stores written off and the consistent practice followed by the assessee, items of stores and spares having individual value of Rs.10000 or less were debited only at the time of consumption. The learned tribunal has rightly held that the Assessing Officer is justified in accepting he claim of the assessee in debiting Rs.92,66,211/- from the Profit and Loss Account. Under the circumstances, the learned tribunal has observed that the order passed by the Assessing Officer cannot be said to be prejudicial to the interest of the revenue, and therefore, the Commissioner was not justified in interfering with the order passed by the Assessing Officer in exercise of powers under Section 263 (of Income Tax Act, 1961). (Para 5.2)