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Issues involved: Appeal against the order of the Commissioner of Income Tax-II, Madurai u/s.263 of the Income Tax Act, 1961 for AY 2008-09.
Summary: 1. The assessee, engaged in processing Gherkins, onions, and other vegetables, filed its return for AY 2008-09 declaring income as 'NIL' under normal provisions. The case was reopened u/s.147 on the issue of deduction u/s.10B. The Assessing Officer observed that the assessee opted out of deduction u/s.10B for AY 2008-09 to claim benefits under another scheme. The income was computed u/s.115JB. The CIT issued a show cause notice u/s.263 citing discrepancies in the assessment. 2. The CIT directed the Assessing Officer to redo the assessment based on the show cause notice. The assessee contended that it did not claim deduction u/s.10B for AY 2008-09, and all relevant documents were submitted during assessment. The Revenue argued that the Assessing Officer did not delve into details of the accounts. The CIT's order was supported by legal judgments. 3. The Tribunal found that the assessee did not claim deduction u/s.10B for AY 2008-09 as per the assessment order. The CIT's reasons for review regarding expenditure verification and balance sheet items were deemed non-specific and lacking basis. Legal precedents cited by the Revenue were deemed inapplicable. The Tribunal set aside the CIT's order, stating it was non-speaking and lacked valid reasons, thereby allowing the assessee's appeal. Judgment: The impugned order was set aside, and the appeal of the assessee was allowed.
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