ORDER :

1. The petitioner is aggrieved by the impugned order dated 26.03.2018 passed by the first respondent under Section 264 of the Income Tax Act, for the Assessment Year 2014-2015.

2. By the impugned order, the first respondent has rejected the application filed by the petitioner for revising the Assessment order dated 21.12.2016 passed by the second respondent under Section 143(3) of the Income Tax Act.

3. Challenge to the order dated 21.12.2016 of the second respondent before the first respondent was primarily on the ground that petitioner has not claimed depreciation under Section 32 of the Income Tax Act, 1961 in respect of four of its properties which were later sold during the course of Financial year 2013-2014 pursuant to an auction and then the petitioner cannot be perforce given the benefit of Section 15(2) of the Income Tax Act, 1961 instead of indexation under Section 48.

4. It is the case of the petitioner that the last return that was filed by the petitioner was for the Assessment year 2001-2002. Thereafter, for the next 11 years, the petitioner had not filed returns as was neither having any income nor loss from the business.

5. It is the further case of the petitioner that the four properties which came to be auctioned and sold resulted in capital gains and therefore the petitioner claimed indexation under Section 48 of the Income Tax Act.

6. It is submitted that the second respondent while passing Assessment order on 21.12.2016 under Section 143(3) denied the indexation under Section 48 of the Income Tax Act,1961 and impose Section 15(2) of the Income Tax Act, 1961. Even though, Section 15(2) of the Income Tax applies only to depreciable assets.

7. It is submitted that under Section 50(2) of the Income Tax Act, 1961, where any block of assets ceases to exist as such, for the reason that all the assets in that block are transferred during the previous year, the cost of acquisition of the block of assets shall be the written down value of the block of assets at the beginning of the previous year, as increased by the actual cost of any asset failing within that block of assets, acquired by the assessee during the previous year and the income received or accruing as a result of such transfer or transfers shall be deemed to be the capital gains arising from the transfer of short- term capital assets.

8. In this connection, learned counsel for the petitioner also drew attention to Section 43(6) of the Income Tax Act, 1961 which defines the expression “written down value” as follows:

Section 43(6) in The Income- Tax Act, 1995

“(6) " written down value" means-

(a) in the case of assets acquired in the previous year, the actual cost to the assessee;

(b) in the case of assets acquired before the previous year, the actual cost to the assessee less all depreciation actually allowed to him under this Act, or under the Indian Income- tax Act, 1922 (11 of 1922 ), or any Act repealed by that Act, or under any executive orders issued when the Indian Income- tax Act, 1886 (2 of 1886 ), was in force: Provided that in determining the written down value in respect of buildings, machinery or plant for the purposes of clause (ii) of subsection (1) of section 32," depreciation actually allowed" shall not include depreciation allowed under sub- clauses (a), (b) and (c) of clause (vi) of sub- section (2) of section 10 of the Indian Income- tax Act, 1922 (11 of 1922 ), where such depreciation was not deductible in determining the written down value for the purposes of the said clause (vi);]

(c) in the case of any block of assets,-

(i) in respect of any previous year relevant to the assessment year commencing on the 1st day of April, 1988 , the aggregate of the written down values of all the assets falling within that block of assets at the beginning of the previous year and adjusted,-

(A) by the increase by the actual cost of any asset falling within that block, acquired during the previous year; and

(B) by the reduction of the moneys payable in res