AI Drafter 
TaxTMI 
TaxTMI 
2023 (2) TMI 1109
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.... Income Tax Act (hereinafter referred to as the 'Act') exercising his revision jurisdiction. 2. The brief facts of the case are that the assessee had filed his income tax return for the assessment year 2012-13 on 17.09.2012 declaring business income of Rs.77,44,480/- along with the agricultural income of Rs.10.89,264/-. The case of the assessee was selected for scrutiny through CASS for the reason 'Large other expenses claimed in the P&L A/c'. The assessment u/s 143(3) of the Act was completed by the Assessing Officer (in short "the A.O") on 30.03.2015 by making total addition of Rs.2,67,323/- after disallowing certain expenses personal in nature. Later on, it was noticed that the issue pertaining to the assessee's claim of licence fee p....
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.... the preceding previous year 2010-11. He observed that the assessing officer had not at all examined the said claim of the assessee even though, it was clearly mentioned in the reasons recorded u/s 148 that the license fee to the tune of Rs. 56,10,000/- pertained to the preceding year 2010- 11. The assessee however explained that the agreement with the Municipal Corporation was executed on 28.02.2011 and that no work could be executed in Financial year 2010-11. That the amount of Rs.56,10,000/-, in fact, pertained to the financial year relevant to assessment year under consideration. However, the ld. PCIT observed as under: "13. Given the fact that it had come to the notice of the Assessing Officer, during the course of reassessmen....
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....ing officer, by mechanically placing on records all the documents submitted by the assessee during the course of reassessment proceedings, without examining the same, and without a correct appreciation of facts and law." The ld. PCIT dealing with the submissions of the assessee held that the order passed by the Assessing Officer 143(3) read with section 147 of the Act dated 29.08.2019 was erroneous and prejudicial to the interest of the Revenue and set aside the said assessment for de novo assessment. 5. Being aggrieved, the assessee has come in appeal before us. 6. At the outset, the ld. counsel for the assessee has invited our attention to the audit objections raised by ITO(Audit) on 20.06.2016 vide which it was observed that the....
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....wrote letter to CCIT dated 08.03.2022 to settle audit objections as no further action survived in the case. However, the PCIT, in view of the said objection, again issued notice u/s 263 of the Act and passed the impugned revision order u/s 263 of the Act. 9. The only contention raised in the revision order is that the amount of Rs.56,10,000/- pertained to the prior year expenses, whereas, the claim of the assessee is that the said amount pertained to the year under consideration as the agreement with the municipal corporation was executed only on 28.02.2011, itself, and that the amount paid to the municipal corporation in the earlier year was advance payment only. It is further pertinent to mention here that even the assessee was not all....
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....s the agreement did not mature and arbitration award has been passed, about which the assessee has claimed that the award amount will be offered for taxation. Under the circumstances, any expenditure incurred by the assessee has also to be deducted and to be allowed. The assessee explained that the agreement with municipal corporation was entered on 28.02.2011 and that no amount was incurred in the financial year 2010-11 and the expenditure was rightly booked in the year 2011-12, therefore, we do not find justification on the part of the ld. PCIT in exercising his revision jurisdiction u/s 263 of the Act in this case. 10. As noted above, the entire exercise seems to have been done because of audit objection only. Since, the Assessing Off....