9911796707
TMI Blog2013 (7) TMI 940X X X X Extracts X X X X X X X X Extracts X X X X ..... riginal assessment u/s.143(3), after due consideration taken a conscious decision not to make any addition or disallowance on the account as sought to be suggested by the learned CIT in his notice u/s.263. He further failed to appreciate that as held, both by the Hon ble Supreme Court and the Gujarat High Court, when an ITO adopts one of the courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the ITO has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue, unless the view taken by the ITO is unsustainable in law. 3. Without prejudice to the legal challenge as referred to hereinabove, even on the merits of the case, the learned CIT was not justified in canceling the assessment order dated 31/12/2010 passed u/s.143(3) and directing the AO to make a fresh assessment of the total income. That the learned CIT clearly erred in holding that there was no evidence on record to show that the condition relating to transfer of technology developed had been fulfilled, because Annexure-2 to the letter dated 26/11/2010 containing the list of parties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er is invalid as the ld.CIT failed to consider the judgements relied upon by the assessee. He also submitted that the ld.CIT is reading into a provision which does not exist on the Statute Book. He submitted that ld.CIT has given an impression as if the granting of patent is mandatory for allowing deduction u/s.80IB(8A) of the Act read with Rules 18DA(1)(e) of the IT Rules. He submitted that the ld.CIT failed to appreciate the merits on the elaborate submissions filed by the assessee in reply to show-cause notice issued u/s.263. He pointed out that during the course of assessment proceedings, the AO had made various queries vide letter dated 04/10/2010 and the same is incorporated in the submissions at page No.4 of the assessee s paperbook. The said notice was duly replied by the assessee vide letter dated 03/11/2010, however, the AO again issued another notice dated 08/11/2010 which is incorporated at page-7 of the paper-book. He submitted that in response to the said notice dated 3.11.2010, assessee filed a reply dated 16.11.2010 and also a final reply dated 26/11/2010, wherein all the details were supplied to the AO. He submitted that AO duly applied his mind on the evidences pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny under section 80-IB(8A) of the IT Act, 1961. He also drew our attention towards page No.24 of the paper book, wherein a letter dated 20/03/2013 addressed to Shri K.Madhusudan, Addl.CIT is annexed. He submitted that all the activities were inspected by the prescribed authority and approval was granted after examining all the aspects. He submitted that there is neither any provision under the IT Act nor under the IT Rules that the technology so developed should have been granted patent for availing deduction u/s.80-IB(8A) of the Act. 2.3. On the contrary, ld.CIT-DR strongly supported the order of the ld.CIT and submitted that the power has been exercised within the provisions of the Act. He submitted that no prejudice is caused to the assessee by the order of the AO. The AO has to make fresh assessment after considering the evidences in support of the claim of deduction u/s.80IB of the Act. He submitted that ld.CIT has rightly directed for fresh assessment as the requisite details were not on record. 3. We have heard rival submissions, perused the material available on record and gone through the orders of the authorities below. The first contention of the ld.counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated that the list of parties to whom such technology was transferred is as per Annexure 2 to the letter dated 26-11-2010. However, having called for assessment records for A.Y. 2008-09, it is found that although Annexure 1 has indeed been annexed to the said letter, there is no Annexure 2 containing the list of parties on the record. It appears, therefore, that no such list of parties to whom the technology was transferred was provided at the assessment stage. One of the conditions is that the technology developed should be transferred. In the instant case, there was no evidence on record to show that this condition had been fulfilled. Accordingly, it is held that the A.O. had accepted the contention of the assessee without making proper enquiries and verification in this regard. The allowance of deduction without any evidence is unsustainable in the eyes of law. Accordingly, it is held that the order dated 31-12-2010 passed by 143(3) by DCIT, Circle-1, Ahmedabad was erroneous and prejudicial to the interests of revenue. The said order is, therefore, cancelled and the A.O. is directed to make afresh assessment of the total income of the assessee. 3.1. There is no disp ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
