9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (11) TMI 534 - AT - Income TaxRevision u/s 263 - As per CIT, AO has not verified the claim of assessee u/s 80IC as well as the additional depreciation claimed by the assessee and interest income arising out of excess payment of advance tax/TDS - HELD THAT - As in the original assessment u/s 143(3) AO has pointedly raised pre-related to details of deduction claim u/s 80IC in the return of income along with supporting evidences in respect of partly transaction of Himachal Unit in the format given in the notice dated 11.03.2019. At the time of assessment proceedings the AO has verified Form 10CCB as well as audited financial statements along with audit report which was enclosed with income tax return and computation of income. The very issues raised by the Pr. CIT of non-verification has been verified thoroughly by the AO at the stage of assessment proceedings u/s 143(3). Assessee through the documents has demonstrated that the claim of 80IC has also been previously claim for nine continuous years and this is the last and 10th year of the said deduction which has been claimed by the assessee. The additional depreciation part as well has been demonstrated by the assessee during the assessment proceedings. Related to interest of TDS the same also has been properly verified by the AO and the documents reveals that no addition is called for in that sphere. Therefore, the invocation of 263 by the Pr. CIT is not justifiable as the proper verification has been done by the AO at the assessment state and the view taken by the Pr. CIT is considered as a changed of opinion and cannot be construed as revisionary powers envisaged under the Pr. CIT s powers given under Section 263 of the Act. Thus, the appeal of the assessee is allowed.
Issues Involved:
1. Jurisdiction of the Principal Commissioner of Income Tax (PCIT) under Section 263 of the Income Tax Act. 2. Validity of the PCIT's direction to reassess specific claims already examined by the Assessing Officer (AO). 3. Examination of the claims for deduction under Section 80IC, additional depreciation under Section 32(1)(iia), and interest on income tax refund under Section 244A. 4. Whether the original assessment order was erroneous and prejudicial to the interest of the revenue. Detailed Analysis: 1. Jurisdiction of PCIT under Section 263: The PCIT assumed jurisdiction under Section 263 of the Income Tax Act, claiming that the AO did not conduct adequate inquiries into the assessee's claims during the original assessment. The PCIT issued a notice directing the AO to reassess the claims related to the deduction under Section 80IC, additional depreciation under Section 32(1)(iia), and the inclusion of interest on income tax refund under Section 244A. 2. Validity of PCIT's Direction to Reassess Claims: The assessee argued that the AO had already raised specific queries and verified detailed replies during the original assessment proceedings. The AO had made a conscious decision after due verification, and thus, the original assessment order could not be deemed erroneous or prejudicial to the interest of the revenue. The assessee contended that the PCIT's direction for reassessment was based on a mere change of opinion, which is not permissible under Section 263. 3. Examination of Specific Claims: - Deduction under Section 80IC: The AO had verified the claim for deduction under Section 80IC during the original assessment by examining Form 10CCB, audited financial statements, and other supporting documents. The assessee had consistently claimed this deduction for nine years, and the year in question was the last of the ten-year period. - Additional Depreciation under Section 32(1)(iia): The AO had scrutinized the claim for additional depreciation, including the transfer of plant and machinery between units. The assessee provided detailed documentation supporting the claim, which the AO had duly considered. - Interest on Income Tax Refund under Section 244A: The AO had verified the inclusion of interest on the income tax refund in the assessee's total income. The assessee provided a detailed break-up of interest income, demonstrating that the interest on the refund was already included. 4. Original Assessment Order: The Tribunal noted that the AO had conducted thorough verification of the claims during the original assessment proceedings. The PCIT's invocation of Section 263 was based on the assertion that the AO had not conducted sufficient inquiry, but the Tribunal found that the AO had indeed examined the issues in detail. The Tribunal held that the PCIT's action amounted to a change of opinion, which is not permissible for invoking revisionary jurisdiction under Section 263. Conclusion: The Tribunal concluded that the original assessment order was neither erroneous nor prejudicial to the interest of the revenue. The AO had conducted adequate inquiries and made a conscious decision based on the evidence provided by the assessee. Therefore, the PCIT's order under Section 263 was not justified, and the appeal of the assessee was allowed. Judgment: The appeal of the assessee is allowed, and the PCIT's order under Section 263 is quashed. The original assessment order passed by the AO stands. Order Pronounced: This order was pronounced in Open Court on 09/11/2022.
|
