2022 (3) TMI 1282

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....for assessment year 2014-15 declaring NIL income after deduction u/s 80-IC amounting to Rs. 1,48,06,156/- and it was selected for compete scrutiny for the reason of mismatch in amount paid to related persons u/s 40A(2)(b) reported in Audit Report and large deduction claimed under Chapter VI-A. Income Tax Officer, Ward 1 (3), Dehradun (hereinafter referred to as the "Ld. AO"). Considering the written submissions, requisite information/ details called vide questionnaire / notice u/s 142(1) and Ld AO had allowed claim of deduction u/s 80-IC of Rs. 1,48,06,156/-. 2. However, the Ld. Revisional Authority considered the assessee not eligible for deduction u/s 80-IC of the Income Tax Act as assessee was engaged in computer programming and Data ....

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....d have also examined the admissibility of such expenses as per the provisions of the Income Tax Act, 1961 which was not done. 2.2 Thus finding the assessment order u/s 143(3) dated 08.09.2016 passed by the Ld. AO to be erroneous and also prejudicial to the interest of the direction were issued to AO to examine the eligibility of deduction u/s 80 IC for activity of assessee in view of Excise classification 84.71 and sub class 30006/7 amongst other issues. 3. The assessee has come in appeal before the Tribunal raising following grounds of appeal; "1. The Ld. Principal Commissioner of Income Tax , Dehradun has erred in passing an order u/s 263 of the Income Tax Act, 1961. 2. The order passed is arbitrary, against the pr....

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....ugned order and he stands with the order passed by Ld. Revisional Authority. 5. After considering the arguments and the matter on record it can be observed that grounds raised in appeal are common in nature and arise from the question of exercise of revisional powers by the PCIT. It can be observed from the paper book that in consequence to notice u/s 142(1) of the Act the Ld. AO had raised query on as many as 19 points and the same were replied substantially by relevant information and documents on 05.08.2016 ( page 225 of the paper book). Detail note was submitted on justification of claim of deduction u/s 80-IC of the Act submitting that the nature of business activity of the assessee falls in category 13 of Part C to Schedule 14 of t....

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....elhi ITAT in M/S. Dwarkadhis Buildwell Pvt. vs Cit, Hisar vide ITA No.3097/Del/2014 decided on 1 July, 2019. 8. However, it appears from the record that when the show cause notice u/s 263 of the Act was issued the Ld. Revisional Authority had then merely raised query seeking explanation from assessee to satisfy how the business of computer programming, data processing entitles benefit of deduction u/s 80- IC of the Act. But without any further query from the assessee or inquiries on his own part made following observations in para 2.6 and 2.7 with regard to disputed questions of fact, for which no show cause was issued :- "2.6 Apart from the above, it has also been observed that no independent verification in respect of sundry c....