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of <h1>ITAT quashes CIT's order on long term capital gains assessment under Income Tax Act</h1> <h3>The Commissioner of Income Tax, CentralI Versus M/s. Birla Global Finance Ltd</h3> The Commissioner of Income Tax, CentralI Versus M/s. Birla Global Finance Ltd - TMI Issues involved: Whether the ITAT was justified in setting aside the order passed by the CIT u/s 263 of the Income Tax Act, 1961.Comprehensive Details:Issue 1: Assessment of Long Term Capital GainsThe assessee company, a Non-Banking Finance Company, received payments on account of goodwill from M/s. Sun Life Assurance Company of Canada for joint venture partnership. The assessee offered the goodwill amounts for taxation as long term capital gains. The assessment was initially completed u/s 143(1)(a) and later scrutinized under u/s 143(3) read with Section 144, where the long term capital gains were accepted. Subsequently, the CIT invoked u/s 263 directing a reassessment to determine the nature of payments made by Sun Life Assurance Company. The ITAT set aside the CIT's order u/s 263.Issue 2: Findings of the ITATThe ITAT found that the Assessing Officer had made a detailed assessment considering the disclosure of goodwill received by the assessee. It concluded that the Assessing Officer had examined the joint venture agreement, the nature of payments, and the accounting treatment. The ITAT held that the decision of the Assessing Officer was based on due application of mind, and the CIT's invocation of u/s 263 was deemed a change of opinion, not sustainable in law. Based on these findings, the appeal was dismissed.This judgment revolves around the dispute regarding the assessment of long term capital gains by the assessee company and the subsequent intervention by the CIT u/s 263 of the Income Tax Act, 1961. The ITAT's decision to set aside the CIT's order was based on the finding that the Assessing Officer had already considered and examined the relevant aspects related to the goodwill payments received by the assessee. The ITAT concluded that the CIT's intervention was merely a change of opinion and not justified under the law. As a result, the appeal was dismissed, upholding the decision of the ITAT.
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