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2022 (7) TMI 1266 - AT - Income TaxRevision u/s 263 by CIT - deduction under Chapter-VIA under section 80IB(10) - HELD THAT:- We note that in the case of Myhome Developers v. ACIT [2021 (3) TMI 345 - GUJARAT HIGH COURT] assessee was a partnership firm engaged in activity of developing housing projects. The assessment in case of assessee was sought to be reopened on ground that assessee had claimed excessive deductions under section 80-IB(10), without providing interest on capital and remunerations to partners for respective years under consideration, which had escaped assessment. Though clauses of partnership deed provided for interest on partner's capital and remuneration, same was subject to their mutual agreement. Thus, it was noted that mere incorporation of clauses in partnership deed for interest on partner's capital and remuneration, did not signify that, interest and remuneration was to be paid to partners mandatorily.The record indicated that assessee had not provided any remuneration interest on capital payable to partners. Accordingly, the Gujarat High Court held that the impugned reopening noticed issued against assessee was unjustified and same was to be set aside. As twin conditions that the order is erroneous and is also prejudicial to interest of revenue are not satisfied in the instant facts. The issue on the claim of excessive deduction under Chapter-VIA under section 80IB(10) of the Act was specifically raised during the course of assessment proceedings and the assessee had filed detailed reply in response thereto during assessment proceedings. Further, as evident from the above judicial precedents, the view taken by the AO is a legally possible view. Therefore, we find no infirmity in the assessment order. Accordingly, we are of the view that Principal CIT has erred in holding that the order passed by the assessing officer is erroneous and prejudicial to the interest of revenue. Appeal of the assessee is allowed.
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