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2022 (11) TMI 770 - AT - Income TaxRevision u/s 263 by CIT - advance gross receipt and the interest receipt - Assessee contravening section 10(23C) (iiiad) r.w.s. 2(15) of the Act & was not eligible for statutory deduction - revisional authority has come to conclusion that the assessee was not investigated by the ld. AO during the assessment proceeding, so, the assessment order is erroneous and prejudicial to the interest of the revenue - HELD THAT:- During the year of appeal, the assessee received the fees from students. The assessee during accounting treatment divide fees in two ways 1) The ‘annual receipts’ which is related to financial year and taken directly in the revenue income. The receipts from students which are not related or utilized for this financial year under appeal as booked as advance under current liability in the balance sheet. These advance fees are taken as annual receipt in the revenue income in next financial year in which year it is related. 2) This is a circular process in each and every year. The ld. Counsel had pointed out that next year the issue was accepted, and the turnover was assessed by the ld. AO without making any addition in the assessment u/s 143(3). In assessee's case while interpreting the treatment of advance fees as current liability or revenue receipt. The AO has taken one view in allowing the current liability on the submissions of the assessee of various judicial pronouncements rendered in the context, whereas the CIT is not in agreement with the view of the ld. AO. The decision of the AO to allow / accept the advance fees as current liability cannot be stated as unsustainable in law as he has taken a possible view based on application of mind. CIT(E) has not brought any material on record to show that the view taken is contrary to law - we are of the considered view that the CIT is not justified in setting aside the order of the ld. AO. Accordingly, the directions of the PCIT are quashed. Appeal of assessee allowed.
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