2021 (10) TMI 668

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.... of the reasons which led to the filing of the instant appeal belatedly. We are satisfied with the reasons. As such, the delay is condoned and the appeal is admitted for disposal on merits. 3. Briefly stated, the facts of the case are that the assessee filed its return declaring total income of Rs. 161.07 crore. The assessment u/s. 143(3) of the Act was taken up in which the Assessing Officer (AO) observed that the assessee company had made investments in mutual funds under Dividend Option Scheme up to 30-09-2014 and from 01-10-2014 onwards the investments were shifted from Dividend Option Scheme to Growth Funds. The assessee earned dividend amounting to Rs. 21,93,20,990/- which was received up to 30-09-2014. From 01-10-2014 to 31-03-2015,....

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.... assessment order was not prejudicial to the interest of the Revenue. He bolstered this argument by placing on record an alternative determination under clause (iii) of Rule 8D(2) computing the amount disallowable under such clause at Rs. 1,51,92,814/- (by taking average value of investment with opening figure as on 01-04-2014 at Rs. 607.71 crore and Nil figure as on 31-03-2015 giving average value of investments at Rs. 303.85 crore) as against the amount disallowed by the AO at Rs. 1.64 crore (with average value of investments at 01-04-2014 to 30-09-2014). For taking Nil figure of investments at the end of the year, the ld. AR relied on ACB India Ltd. vs. CIT (2015) 374 ITR 108 (Del) holding that the average value of investments, for the p....

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....it becomes manifest that the power u/s. 263 can be invoked only when the assessment order is found to be both erroneous as well as prejudicial to the interest of the Revenue. If one of these two elements is missing, then the power under this section is ousted. The ld. AR has made out a case that the assessment order in this case is certainly erroneous but not prejudicial to the interest of the Revenue. The calculation put forth before the Tribunal for demonstrating that the assessment order was not prejudicial to the interest of the Revenue has neither been vetted by the AO or the ld. CIT. We refrain from making any comment on its correctness without considering the corresponding details. In our considered opinion, it would be in the fitnes....