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2020 (1) TMI 1035 - ITAT MUMBAIRevision u/s 263 - provision for bad and doubtful debts u/s 36(1)(va) - HELD THAT:- In this case, from the facts, it can be seen that the relief has been allowed only after making enquiries. Therefore, this clause has also not applicable in this case. Therefore, we are of the considered view that the conditions to invoke the powers u/s 263 of the Act are not satisfied and hence, the Ld.PCIT was erred in invoking the scope of provisions of 263 of the I.T.Act, 1961. Further, assuming for a moment, but not accepting in order to invoke 263, the other conditions, which is to be satisfied is that the order should be prejudicial to the interest of the revenue, because in respect of bad debts claim, if any deduction allowed u/s 36(1) (vii) of the Act, then when the recovery of the same in subsequent years needs to be offered to tax u/s 41(4) of the Act. In respect of payment towards contribution to the gratuity fund, whether or not deduction is allowed in full on payment basis in this year, but the same needs to be allowed in subsequent years, if said payment is not allowed during the year under consideration. Likewise, provision for wage arrears is also liable to be allowed, when the actual payment has been made. In this case, the assessee has made payment of the wage arrears in the subsequent years. Therefore, we are of the considered view that invocation of jurisdiction u/s 263 on these issues is also incorrect. We are of the considered view that the conditions prescribed u/s 263 are not fulfilled to invoke revisional jurisdiction by the Ld.PCIT to revise the assessment order passed by the Ld. AO u/s 143(3) of the I.T.Act, 1961. Therefore, we are of the considered view that the assessment order passed by the Ld. AO is neither erroneous, nor prejudicial to the interest of the revenue. We, therefore, quash the order of the Ld.PCIT u/s 263 of the Act, and allow the appeal of the assessee.
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