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2018 (6) TMI 1452 - AT - Income TaxRevision u/s. 263 - directing the AO to re-compute the taxable income of the assessee - income tax paid by a charitable trust - deduction in arriving at income available for application of charitable purposes - Held that:- Issue in the present case is no longer res integra and the consensus view among various Hon’ble High Courts are that the income tax paid by a charitable trust must be allowed as deduction in arriving at income available for application of charitable purposes. The finding and the direction given by the Ld. CIT(E) in the impugned order requiring the AO to disallow the income tax paid of ₹ 40,60,061/- as expenditure is clearly contrary to the consistent view taken by the Hon’ble High Court at Delhi, Gujarat and Andhra Pradesh and, therefore, the direction of the Ld. CIT(E) is not inconformity with the view of the Hon’ble High courts, therefore, the direction of Ld. CIT(E) is clearly unwarranted and legally not tenable, so the direction of ld. CIT(E) is invalid. As brought to our notice that AO has given effect to the impugned order of Ld. CIT(E) on 27.12.2017 and after complying with the direction of Ld. CIT(E) and after disallowing ₹ 40,60,061/- (income tax paid) still the total income is “NIL”. So we note that there is no prejudice whatsoever caused to Revenue, so even if for argument sake the Ld. CIT(E)’s contention and direction is accepted as correct, then also the twin conditions which is a condition precedent is not satisfied at all. Thus in any case, the AO’s original order dated 14.11.2014 cannot be held to be erroneous and prejudicial to the Revenue. - decided in favour of assessee.
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