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2015 (2) TMI 538 - AT - Income TaxRevision u/s 263 - non-invoking of section 40(a)(ia) by the Assessing Officer - Held that:- It is a well-settled proposition that a Commissioner is denuded from exercising his revisionary power u/s 263 of the Act unless he is able to establish that the order under revision is erroneous as well as prejudicial to the interests of the Revenue. The absence of either of the two conditions would not justify invoking section 263 of the Act by the Commissioner. In the present case, the action of the Commissioner to direct the Assessing Officer to disallow ₹ 1,32,83,963/- u/s 40(a)(ia) of the Act does not establish any loss of tax for the Department in the face of assessee’s assertions that such income is exempt u/s 10A of the Act, which is in line with the judgement of the Hon’ble Bombay High Court in the case of Gem Plus Jewellery ( 2010 (6) TMI 65 - BOMBAY HIGH COURT ). Therefore, in the absence of fulfillment of one of the condition of the order being prejudicial to the interest of the Revenue, the impugned action of the Commissioner is not tenable. The order of the Commissioner qua the disallowance u/s 40(a)(ia) of the Act is hereby set aside. - Decided in favour of assessee.
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