TaxTMI 
TaxTMI 
TaxTMI 
2021 (7) TMI 571
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....e Principal Commissioner of Income Tax did not appreciate the settled position of law where proceedings u/s 263 do not stand to sustain if Principal Commissioner of Income-tax opts to take different view in the same matter. (4) On merits, the appellant submits that the learned Principal Commissioner of Income-tax was misdirected to hold that the Assessing Officer failed to compute/determine the quantum of deduction u/s 80-IA of the Act particularly when the claim of the appellant was justifiable allowed. (5) The learned Principal Commissioner of Income-tax was driven by extraneous consideration in not dropping the proceedings u/s 263. (6) The appellant craves leave to add, alter or vary any of the grounds of appeal. 2. The relevant material facts, as culled out from the material on record, are as follows. Assessee before us is a private limited company. The assessee is engaged in the business of processing of yarn from POY to simple yarn and making crape yarn from simple yarn and generation of power through wind mills. The assessee company filed its return of income for the assessment year 2013-14 on 30.09.2013 declaring total income at Rs. 52,88,650/-. The assessee`s return....
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....m of e-filing demands such Forms to be filed online. I attach copy of downloaded form 10CCB (Paga no.8 to 11A) from the Income-tax website. And, so far as filing of accounts are concerned, the point has already been stated in (a) above. (b).The third issue relates to filing of year-wise profit/loss. Again, this always stood filed with the Income-tax. The assessee installed the Windmill in the year 2008, and started claiming relief u/s 80-IA(4)(iv) only w.e.f. A.Y-2012-13 as the First year and the year, which is now being dealt, being the second year. This is because 80-IA(2) gives option to the assessee to claim relief in ten consecutive years out of fifteen years beginning from the year in which the undertaking begins to generates power. Please find year-wise copies of Form 10CCB that specifies the profit from the windmill undertakings. Assessment year Year of claim Filing of date of Form 10CCB that states the Profit and the year of claim. Page Ref. 2012-13 1st year 17-3-2015 25 2013-14 2nd year 29-9-2013 11A What is being conveyed is that what the assessee has done is completely legitimate and with Assessing officer having accepted Form 10CCB filed onl....
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....al assessment year and to every subsequent assessment year up to and including the assessment year for which the determination is to be made." Section 80IA allows deduction equal to 100% of the profits and gains derived from such business for ten consecutive assessment years. This allowance of deduction u/s 80IA casts higher responsibility on the shoulder of assessing officer to compute the claim thoroughly as it has larger revenue implication. (ii).The AO in these circumstance can compute the deduction only after going through relevant book of account, paper, vouchers, bills, expenses proof, income proof etc. required 7. In view of legal position narrated above, the ld PCIT held that order passed by the assessing officer u/s 143(3) of the I. T. Act. 1961, on 10.03,2016, is erroneous and prejudicial to the interest of revenue, as the AO failed to compute/ determine the quantum of deduction available to assessee company for A.Y. 2013-14 during the assessment proceedings. The ld PCIT also held that in assessee`s case, clause (a) and (b) of the Explanation 2 of Section 263 of the I.TAct, 1961 is clearly applicable. The ld PCIT found that the A.O. has passed the assessment order w....
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....e to examine as to whether in the first place the order of the Assessing Officer found fault by the Principal CIT is erroneous as well as prejudicial to the interest of the Revenue. For that, let us take the guidance of judicial precedents laid down by the Hon'ble Apex Court in Malabar Industries Ltd. Vs. CIT [2000] 243 ITR 83(SC) wherein their Lordship have held that twin conditions needs to be satisfied before exercising revisional jurisdiction u/s 263 of the Act by the CIT. The twin conditions are that the order of the Assessing Officer must be erroneous and so far as prejudicial to the interest of the Revenue. In the following circumstances, the order of the AO can be held to be erroneous order, that is (i) if the Assessing Officer's order was passed on incorrect assumption of fact; or (ii) incorrect application of law; or (iii)Assessing Officer's order is in violation of the principle of natural justice; or (iv) if the order is passed by the Assessing Officer without application of mind; (v) if the AO has not investigated the issue before him; then the order passed by the Assessing Officer can be termed as erroneous order. Coming next to the second limb, which is required to b....
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....scertained. (4).[Para 5.4 of PCIT Order] The AO in these circumstance can compute the deduction only after going through relevant book of account, paper, vouchers, bills expenses proof, income proof etc. required. 14. Now, we shall examine, one by one, in respect of above issues raised by the ld PCIT in his 263 order, to know whether order passed by the assessing officer is erroneous and prejudicial to the interest of revenue. (1).[Para 3 of PCIT Order] Details of Profit and Loss account for assessment year 2013-14 was not available on record in respect of aforesaid undertaking (windmill unit). Reply of ld Counsel in respect of the above issue is as follows: "Income Statement was not furnished at this stage because as per CBDT Circulars No.03/2009 dt. 21/05/2009 (pg.29- 32) and No.09/2006 dt.10/10/2006 (pg.33-35), in the e-filing regime, filing of Profit & Loss Account (including those of undertakings) as an Annexure to e-Returns and e-Forms is not required". We note that in response to the notice under section 142(1) of the Act, the assessee has replied the specific question asked by the Assessing Officer about the wind mill, vide assessee`s reply dated 26.11.2015, to th....