TaxTMI 
TaxTMI 
2017 (8) TMI 422
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.... passed by the Income Tax Appellate Tribunal ('ITAT') in ITA No. 2487/Del./2016 for the Assessment Year ('AY') 2010-2011. 3. Although, in the memorandum of appeal, the Revenue has urged as many as 21 questions of law, only one question arises for consideration. The first and the central question pertains to the exercise of jurisdiction by the Principal Commissioner of Income Tax ('Pr CIT') under Section 263 of the Act by the order dated 29th March, 2016 restoring the assessment for the AY in question to the file of the Assessing Officer ('AO') for making a de novo assessment. 4. The Pr CIT sought to order a de novo assessment on two issues. One pertained to the tax credit claimed by the Respondent/Assessee in respect of the dividend incom....
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.... conducted by the Assessing Officer." The ITAT perused the queries raised by the AO and the reply given thereto by the Assessee, in respect of the dividend income received from OMIFCO. Therefore, the contention of the Revenue that no adequate enquiries in respect of the above issue were made was held to be 'completely misplaced'. 8. Further, on this very issue, the finding of the ITAT in para 14.2 of the impugned order reads as under: "(a) That. detailed inquiries were made by the Assessing Officer at the time of the original assessment proceedings with regard to the tax credit on deemed dividend which would have been payable in Oman but for the exemption granted the assessee had filed detailed replies in response to the query which were ....
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....e impugned order as under: "16. We have carefully considered the submissions and arguments made by the learned counsel of the assessee as well as the learned CJT(O.R.) and heard both the parties at length. We find that the Assessing Officer had made detailed inquiries and examined the entire block of fixed assets. A brief note on capital work in progress was also filed and queries regarding the manner in which the depreciation was claimed was also raised. Further the assessee is following a settled accounting policy/principle for capitalization of expenses including interest expenses to both the fixed assets as well as capital work in progress. This method was forming part of the audited financial statements which were filed before the Ass....
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....t in Reliance Utility and Power Ltd. (supra), no disallowance u/s.36(1)(iii) is called for. (c) That, the assessee had already discharged its onus of proving non-diversion of funds borrowed for working capital towards capital work in progress and fixed assets by submitting a certificate of an independent statutory auditor and proved availability of own funds and internal accruals which was not rebutted by Ld. Pr.ClT." 11. Lastly, it was urged by Mr. Manchanda that the ITAT failed to note the changed position as a result of the insertion of Explanation-2 in Section 263 of the Act with effect from 1st June, 2015. However, on this aspect, the ITAT has specifically held in para 17 of the impugned order as under: "17. Before concluding we wou....