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2023 (3) TMI 1037 - AT - Income TaxRevision u/s 263 by CIT - Employee Stock Option (ESOP) Scheme expenses Allowability - HELD THAT:- As brought to our notice that the order relied by the in the case of Ranbaxy Laboratory Ltd. [2009 (6) TMI 126 - ITAT DELHI-I] wherein examined in the case of Biocon Limited (2013 (8) TMI 629 - ITAT BANGALORE] as confirmed by hc [2020 (11) TMI 779 - KARNATAKA HIGH COURT] hence the order relied upon by the ld. PCIT is no more good law. Hence, we hold that the directions given in the order u/s. 263 are not valid. Prior Period expenses - Hon'ble Delhi High Court in the case of CIT vs Anil Kumar Sharma [2010 (2) TMI 75 - DELHI HIGH COURT] also held that where there was no "lack of enquiry" by AO even if it could be said to be inadequate, proceedings under section 263 of the Act was not valid since the AO had applied his mind to complete details filed by the assessee. In light of the facts submitted in the original assessment, the above expenses are crystallized during the year and no deduction of the same is claimed in the earlier year. Hence, the aforesaid expenses are an allowable deduction under the Act while computing the profit and gains of business and profession & that the AO has correctly appreciated the said position while passing the assessment order. Hence, we hold that the directions given in the order u/s. 263 are not valid. Interest on Late Payment of TDS - as argued that the definition of tax under the Act read with provisions of section 40(a)(ii) of the Act, the interest paid under section 201(1A)/206C(7) on late payment of TDS does not fall within the meaning of 'tax' and hence no adjustment is warranted in the returned income - We find that the AO has failed to disallow above mentioned interest expenditure while passing the order u/s. 143(3) and hence rendering the assessment erroneous and prejudicial to the interest of revenue. The order of the ld. PCIT u/s. 263 is upheld on this issue.
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