TaxTMI 
TaxTMI 
2023 (10) TMI 191
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..... 2. Facts relating to the case are stated in brief. The assessment in the hands of the assessee was completed by the Assessing Officer under section 143(3) read with section 144B of the I.T. Act on 22.4.2021. The Learned PCIT examined the record for the year under consideration and took the view that the assessment order passed by the AO is erroneous and prejudicial to the interests of the revenue, since the Assessing Officer has allowed the following claims made by the assessee without carrying out due enquiries and verifications :- a) Deduction under section 35(2AB) of the Act : Rs. 32.60 crores b) Deduction claimed under section 35(1) of the Act : Rs. 1.41 crores c) Deduction claimed under section 80G of th....
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....ed by Hon'ble Bombay High Court, in the case of Grasim Industries Ltd. V CIT (321 ITR 92) by taking into account the law laid down by the Hon'ble Supreme Court. The relevant observations are extracted below: Section 263 of the Income-tax Act, 1961 empowers the Commissioner to call for and examine the record of any proceedings under the Act and, if he considers that any order passed therein, by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the Revenue, to pass an order upon hearing the assessee and after an enquiry as is necessary, enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment. The key words that are used by section 263 are that the....
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....evenue, or where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the Revenue unless the view taken by the Income-tax Officer is unsustainable in law." The principle which has been laid down in Malabar Industrial Co. Ltd. [2000] 243 ITR 83 (SC) has been followed and explained in a subsequent judgment of the Supreme Court in CIT v. Max India Ltd. [2007] 295 ITR 282." The principles laid down by the courts are that the Learned CIT cannot invoke his powers of revision under section 263 if the Assessing Officer has conducted enquiries and applied his mind and has taken a possible view of the matt....
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.... be furnished by the prescribed authority directly to the Principal Chief Commissioner of Income tax or Chief Commissioner of Income tax and the assessee cannot furnish the same. Accordingly, it was contended that the assessee cannot be found fault with if the Form 3CL was not given by the prescribed authority. 7. However, on a perusal of Rule 6(7A)(b) would show that the said rule prescribes certain condition, which inter alia, includes quantification of Expenditure eligible for deduction u/s 35(2AB) of the Act in Form 3CL. Even though it is not the responsibility of the assessee to furnish above said form, yet it is the requirement prescribed in Rule 6(7A), which should have been examined by the AO before allowing deduction u/s 35(2AB)....
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....) of the Act was amended with effect from 1.4.2016 by Finance Act, 2015, wherein it is stated that the assessee should fulfil such conditions with regard to maintenance of accounts and audit thereof and furnishing of reports in such manner as may be prescribed. We notice Rule 6(7A) was amended w.e.f 1.7.2016, i.e., after the amendment made in Sec. 35(2AB)(3) of the Act. Further, Form 3CL is one of the forms prescribed in Rule 6(7A)(b) of the Rules for quantifying scientific research expenditure by the prescribed authority. Since the rules prescribe for examination of the above said form, it is the duty of the AO to verify the same before allowing the deduction u/s 35(2AB) of the Act. Admittedly, the AO has not examined this aspect, even tho....