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2019 (12) TMI 446 - AT - Income TaxRevision u/s 263 - Treatment of receipts from NRDA - Capital receipt or revenue receipt - HELD THAT:- Enquiries were made by the AO during the course of the assessment proceedings. The first query letter dated 21.04.2015 contained 47 points and the said query letter is placed. A detailed reply was filed vide reply dated 01.07.2015 and the same is placed. The second query letter is dated 21.09.2015 which is placed at page 364 of the PB and the reply has placed at page 361 of the PB dated 08.10.2015 in which the assessee specifically explained the treatment of receipts from NRDA and pointed out that the nature of receipts has already been explained in not on business activities. By another reply dated 30.10.2015 which is placed assessee explained that the financial assistance received from NRDA is in the nature of capital receipt and cannot be considered as Revenue receipt. It was specifically explained that financial assistance if received for creation of an asset is not taxable being capital receipt. It was pointed out that any receipt which is intrinsically connected with construction of assessee’s plant would be capital receipt. A further reply was filed on 19.02.2016 giving the details of capital work in progress and treatment of amounts received from NRDA this reply is placed at pages 299 to 302 of the PB. Considering these plethora of evidences it cannot be said that no enquiry was made by the AO during the course of the assessment proceedings. There remains nothing for the PCIT to assume jurisdiction u/s 263 of the Act to say that assessment order is not only erroneous but prejudicial to the interest of the Revenue. We are of the considered view that the PCIT has wrongly assumed the jurisdiction u/s 263 of the Act. Hence, his order for both the assessment years under consideration deserves to be set aside. We, accordingly, set aside the order of the PCIT and restore that of the AO. - Decided in favour of assessee.
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