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2018 (10) TMI 722

Administrative Commissioner jurisdiction to pass order u/s 263 as against draft assessment order - Draft assessment already merged with the final assessment order - Held that:- As in assessee’s own case for assessment year 2010-2011 [2017 (1) TMI 1422 - ITAT COCHIN] had held that draft assessment order cannot be revised u/s 263 of the I.T.Act. It is informed that the said order (supra) of the Tribunal in assessee’s own case is pending adjudication before the Hon’ble High Court. - We also noticed that the Delhi Bench of the Tribunal in the case of Bausch & Lomb India Pvt.Ltd. v. ACIT [2017 (12) TMI 348 - ITAT DELHI] was of the view that the Administrative Commissioner does not have power to revise the draft assessment order. We hold that .....

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owance under section 40(a)(ia) of the LT Act in respect of payment to persons on account of R&D expenditure ₹ 4,92,42,256/-. 4. Notwithstanding the ground relating to reopening u/s.263, the CIT erred in setting aside the assessment to examine the disallowance u/s.40(a)(ia) of the IT Act, in respect of expenses incurred for testing of tyres outside India amounting to ₹ 3,27,61 ,904/-. 5. For these and other grounds that may be further adduced at the time of hearing, the order of the Ld.Commissioner of Income tax requires to be modified suitably. 3. The only issue that is raised in this appeal is whether the Administrative Commissioner has jurisdiction to pass order u/s 263 of the I.T.Act as against draft assessment order. The .....

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that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard etc., revise the order. What is the subject matter of revision is an order of the AO and that too, if it is prejudicial to the interest of the revenue. An order can be prejudicial to the interest of the revenue only when it crystallizes the liability of the assessee to pay and notice of demand is issued, which in the opinion of the authority is prejudicial to the interest of the revenue. If no final liability, pursuant to which a demand notice can be issued, is capable of determination at that stage, such a draft order ceases to be characterized as .....

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