Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2021 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (9) TMI 457 - AT - Income TaxRevision u/s 263 by CIT - TP Adjustment - Non reference to the TPO - HELD THAT:- PCIT has failed to specify as to how and on what ground the assessment order is erroneous and/ or which part of the CBDT instructions were not adhered to by the AO. Merely not recording the satisfaction, the AO on the records does not make the assessment order erroneous and prejudicial to the interest of revenue, as is decided in the various judicial pronouncement by various courts - as perused Instruction no 3/2016 and are of the opinion that it was not mandatory for the AO to make a reference to the TPO. Even as per the order and the show cause notice u/s 263 which has been issued it is evident that the selection of the case was for complete scrutiny and the issues was not on transfer pricing parameters risk factors. The clause (a) states where there are international transactions or specified transactions or both and the taxpayer has not filed any report required to be submitted under section 92E. This is not a situation in the case of the assessee, and report was submitted and also during the assessment the same was submitted. The second situation where in previous assessments if any addition on account of transfer pricing adjustment of more than ten crores and addition being upheld in appellate proceedings is also not applicable in the case of the assessee, and this is not a case where search or seizure or survey operations had been carried out. In such a situation it cannot be said that the assessment is erroneous as reference to TPO was not made. Claim u/s 80IA(4)(iv) - As the said deduction had already been disallowed by the AO in the assessment order, and therefore the order on such issue cannot be said to be prejudicial to the interest of revenue. Claim u/s 35(2AB) - Deduction u/s 35 (2AB) of the IT Act 1961, was allowed on the basis of the expenditure based on the report submitted to DSIR. Thereafter, the Government of India Ministry of Science & Technology, Department of Scientific and industrial Research, Technology Bhawan New Delhi vide its letter No. TU/IV-15(493)/2017 dated 3.11.2017 had restricted the eligible expenditure for Research, and accordingly the deduction was allowed in the assessment order, and the issue was again duly examined at the time of assessment, and no error in such claim has been pointed out to us. As regards claim u/s 10AA the claim was allowed on the basis of report in form 56F and after examining the facts of the case, and this was not the first year of claim and was also allowed in the earlier years also.In light of above discussion we hold that the order u/s 263 cannot be sustained as we find that the assessment order passed by the AO cannot be said to be erroneous or prejudicial to the interest of revenue, and accordingly the order made u/s 263 of the is quashed.- Decided in favour of assessee.
|