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2017 (3) TMI 432 - AT - Income TaxRevision u/s 263 - addition u/s 14A - Held that:- AO had sought to make disallowance u/s 14A of the Act having regard to the accounts of the assessee in terms of section 14A(2) of the Act and we hold that he need not resort to Rule 8D always for the purpose of making disallowance. Admittedly, the Rules cannot prevail over the Act as it is only a subordinate piece of legislation. When the Act clearly stipulates the point that the ld AO is entitled to make disallowance u/s 14A(2) of the Act having regard to the accounts of the assessee , then no error could be attributed on that aspect in the order of the ld AO. Moreover, we also find that if Rule 8D is adopted , then it would only result in lesser disallowance figure u/s 14A of the Act as enumerated above in the detailed factual workings given by the assessee before the ld CIT. Hence it could be safely concluded that the assessee had erred on the revenue side and offered more amount of disallowance u/s 14A of the Act which has been accepted by the ld AO. Hence it could be safely concluded that the ld AO had taken a possible view and this action had not caused any prejudice to the interest of the revenue but on the contrary as stated above, it had only caused prejudice to the interest of the assessee. Hence, the dual conditions stipulated in section 263 of the Act are not satisfied cumulatively. The most celebrated judgement of Gee Vee Enterprises vs Addl CIT (1974 (10) TMI 29 - DELHI High Court ) would not come to the rescue of the revenue in the instant case as the facts of the instant case did not provoke any further enquiry in the mind of the ld AO and hence there cannot be any error that could be attributed in his order. Hence the ld CIT could not invoke revision jurisdiction u/s 263 of the Act in the instant case. - Decided in favour of assessee
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