TaxTMI 
TaxTMI 
2025 (8) TMI 374
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....ee has raised the following grounds of appeal: "1. On the facts and circumstances of the case as well as law on the subject, the learned Principal Commissioner of Income Tax, Surat has erred in passing order u/s 263 of the Act for assessment year 2020-21. 2. On the facts and circumstances of the case as well as law on the subject, the learned Principal Commissioner of Income Tax, Surat has erred in passing order u/s 263 of the Act when order passed by Assessing Officer is neither erroneous nor prejudicial to the interest of revenue. 3. On the facts and circumstances of the case as well as law on the subject, the learned Principal Commissioner of Income Tax, Surat has erred in passing the order u/s 263 of the Act o....
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....n through ICDS adjustments and that a net increase in income of Rs.1,07,53,745/- was duly reported and offered for taxation under 'Other Information' in the ITR. Supporting documentation such as the tax audit report, additional ICDS notes, and return of income were submitted to substantiate this position. It was contended that the proposed disallowance under revision proceedings was factually incorrect as no deduction had been claimed for this provision while computing taxable income. However, the PCIT, upon examination of assessment records, observed that while the assessee had reported a net add-back of Rs.1,07,53,745/-, the calculation involved offsetting figures, including a significant deduction of Rs.3,68,89,930/- under "Ind A....
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....sessing Officer. Accordingly, the PCIT held that the assessment order was passed without necessary inquiry into material issues, making it erroneous and prejudicial to the interest of the Revenue. 4. The assessee is in appeal before us against the order passed by Principal CIT u/s 263 of the Act setting aside the assessment order passed by the Assessing Officer as being erroneous and prejudicial to the interest of the Revenue. Before us, the Counsel for the assessee reiterated the submissions made before us Principal CIT in 263 proceedings. In response, the Ld. DR placed reliance on the observations made by Principal CIT in the 263 order. We have heard the rival contentions and perused the material on record. In this case, Principal CIT ....
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.... to verify the genuineness or eligibility of the section 80G claim is not coming from the facts and amounts to a mere change of opinion by the PCIT, which is impermissible in law under section 263 of the Act. With regards to the second issue regarding the expected credit loss of Rs.1,94,67,203/-, the Counsel for the assessee submitted that while the said amount was debited to the profit and loss account as per Ind AS-compliant financial statements, the entire amount was voluntarily offered for taxation by making corresponding adjustments under the Income Computation and Disclosure Standards (ICDS), specifically under ICDS I (Accounting Policies). This adjustment was duly disclosed in the Tax Audit Report and in the ITR under "Part A - OI - ....
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.... be substituted by the PCIT merely because he holds a different view, unless the view of the Assessing Officer is unsustainable in law or results in prejudice to the Revenue. 5. Further, looking into the merits of the case as well, in the case of AIA Engineering Ltd. vs. Principal CIT (ITA Nos. 309 & 310/Ahd/2024), the Ahmedabad Bench of the Income Tax Appellate Tribunal addressed the issue of whether Corporate Social Responsibility (CSR) expenditure is allowable as a deduction under Section 80G of the Income Tax Act. The Tribunal held that CSR expenditure is eligible for deduction under Section 80G, provided the other conditions of that section are met. The Tribunal relied on several rulings by co-ordinate benches across India, holding ....