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2017 (7) TMI 822 - HC - Income TaxReopening of assessment - deductions under Section 80-IA - revision order u/s 263 - Held that:- The Court is unable to accept the plea of the Revenue in the present case that: (i) The Assessee here did not fulfill the eligibility condition for the initial AY i.e., 1997-98; and (ii) That notwithstanding that it may have fulfilled the eligibility conditions in the initial AY, it nevertheless had to fulfill the such eligibility condition for every one of the ten consecutive AYs inclusive of the initial AY in order to be eligible for the deduction. In the present case, the assessment was completed under Section 143(3) of the Act for AY 1998-99 onwards. There was no error as such committed by the AO in allowing the deductions under Section 80-IA since the correct interpretation of the said provision was open to debate. The twin conditions of (i) the order having to be erroneous and (ii) prejudicial to the interest of the Revenue cannot be said to have been be cumulatively satisfied in the present case. That the power under Section 263 cannot be exercised to revisit debatable issues is well settled. The re-opening of assessment under Section 147 of the Act was only on account of the orders passed by the CIT under Section 263 of the Act and for no other reason. This Court having held that there is no justification for the CIT to have invoked Section 263 of the Act, the re-opening of the assessments under Section 147 of the Act in AY 1998- 99, which is the only year for which the question was framed, was not justified.- Decided in favour of assessee.
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