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2012 (6) TMI 547 - AT - Income TaxValidity of revisionary power exercised by DIT u/s 263 - composite contract of providing material and services - order revised on ground that composite contract cannot be segregated to tax a part of it u/s 44BB and part of it as FTS u/s 9(1)(i) - assessee contended change of opinion - Held that:- This was a case of composite work contract which cannot be considered in parts for the purpose of taxation. Assessee has opted for working out the taxable income as per the provisions of section 44BB. Very objection of introducing the fiction of income u/s 44BB is to avoid all complications in determining the liability of an assessee coming under that provision. If an exercise is to be conducted in each assessee's case to ascertain the liability of taxation, then the very purpose of the section will be defeated. hence, there was no two views possible on this issue and the Assessing Officer has committed a mistake which has rendered the order erroneous and prejudicial to the interest of revenue. Further, DIT has rightly held that provisions of sections 197 and 195 are interim and provisional proceedings in nature. These are only for the purpose of making withholding taxes. The real taxability of the receipts or any sum on which the tax has been deducted can be determined only in regular assessment proceedings. DIT has not substituted his own view to the Assessing Officer's view. The Assessing Officer has not applied his mind in view of the provision of law. DIT was justified in exercising revisionary powers - Decided against the assessee.
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