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2014 (11) TMI 1059 - HC - Income TaxRevision u/s 263 - whether, the revenue could have issued notice under Section 263 of the Act, despite the fact that, against the original order of assessment, the assessee had preferred appeal before the CIT(A), which came to be allowed in part, and against which the appeals preferred by the assessee as well as the revenue were pending decision before the Tribunal - Held that:- The assessee and the revenue both had preferred the appeals raising all the grounds, over and above the ground of deduction under Section 80HHC and 80IA of the Act, the order of the AO stood merged into the order of the CIT(A). In other words, what was at large before the Tribunal was not only the issue with regard to claim of the assessee for deduction under Section 80HHC and 80IA of the Act, but, with regard to additions and disallowances made by the AO, as well. Thus, the principle of merger would apply in this case. Meaning thereby, once the CIT(A) partly allowed the appeal of the assessee in respect of the additions and disallowances made by the AO by way of order dated 23.03.2005, same got merged with the order of the CIT(A). Therefore, when the appeals filed by the assessee as well as the revenue before the Tribunal were pending, in view of the principle of merger and the decision of this Court in “COMMISSIONER OF INCOME TAX VS. SHASHI THEATER PVT. LTD.” (2000 (9) TMI 33 - GUJARAT High Court ) wherein held that power of revision do not extend to the matters on which the appellate authority had given decision, the assessee could not have been issued the notice under Section 263 of the Act, more particularly, in view of the fact that the matter was at large before the Tribunal in its entirety. Even otherwise, in view of the fact that before issuing the notice under Section 263 of the Act, the assessee was neither heard nor the revenue conducted any inquiry, same deserves to be quashed and set aside. - Decided in favour of assessee
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