TMI Blog2022 (2) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... icer during the course of assessment proceedings on this issue and, therefore, it was a case of lack of enquiry. According to this Section if a fact is likely to have happened: i) in common course of natural events ; ii) according to general human conduct; iii) according to public and private business; iv) due to the relation to the facts of the particular case. Accordingly, the Court can presume the existence of that fact i.e. in this case we take the aid of illustration (e) to section 114 of the Indian Evidence Act, which helps us presume judicial and official acts have been regularly performed . So we presume in the facts and circumstances, and after going through the relevant pages of the PB that AO has regularly performed his duties. Since from perusal of the papers filed before the AO itself (PB) we are convinced that there was no error as wrongly assumed by Ld. PCIT. Therefore the Ld. PCIT erred in assuming revisional jurisdiction to interfere with the action of AO - the impugned order passed by the ld. Pr. CIT u/s 263 of the Act is without jurisdiction and so liable to be quashed. - Decided in favour of assessee. - ITA No. 176/Kol/2021 (Assessment Year: 2016-17) - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribution made to the said institution. 3. Since the above errors in the order passed by the Assessing Officer u/s 143(3) of the Act according to the ld. Pr. CIT, made the said order prejudicial to the interest of the revenue, he issued a notice requiring the assessee to show-cause as to why the assessment order passed by the Assessing Officer should not be revised/modified or set aside by invoking provisions of Section 263 of the Act. In reply to the show-cause notice issued by the ld. Pr. CIT u/s 263 of the Act, the following explanation was offered by the assessee in writing in respect of the three errors allegedly pointed out by the ld. Pr. CIT in the order of the Assessing Officer passed u/s 143(3) of the Act:- During the year your Assessee Company had net profit after tax (but before Deferred Tax) of ₹ 513.23 Crores, which was arrived after provision for total current tax of ₹ 132,76,60,000/- (includes Regular Tax of ₹ 76,89,77,000/- + MAT Tax of ₹ 55,86, 83,000/-). As per the provisions of section 115JAA, Assessee Company has claimed, MAT Tax paid over and above regular tax payable, ₹ 55,86,83,000/- as MAT Credit Entitlement. Since, the M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... JK Paper Ltd, i.e. your Assessee's group company's case, wherein, on similar facts and circumstance, the Ld. Commissioner of Income Tax (A)-1, Surat, vide Para 10.3 onpage 16 of his order (copy of relevant portion of order is enclosed herewith as Annexure '6') had allowed the appeal in favour of appellant by holding as under: 10.3 The contentions of the Assessing Officer as well as the appellant have been examined. It is apparent that the MAT credit is a Deferred Tax and in view of Explanation to section 115JB, the book profit' is to be increased if tax is debited and reduced if the Deferred Tax is credited in accordance with clause h and clause viii of Explanation -I. Consequently, the ground no. 4 is allowed in favour of the appellant. It may kindly be appreciated that in the aforesaid matter, on further appeal by Revenue before ITAT, Ahmedabad, the Hon'ble ITAT, 'C' Bench, Ahmedabad in ITA No: 2156/AHD/2013 C.O. No. 37/Ahd/2014 (copy of order is enclosed herewith as Annexure '7' has dismissed the department appear vides Para 3 on page 10 of their order by holding as under: 23. It can be seen that provision for curren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income are enclosed herewith as Annexure '8'. From perusal of aforesaid details, your goodself will kindly observe that during the year, Assessee Company has paid donation of ₹ 5,25,31,000/- and offered the same for tax vide para 2b (ii) of Computation of Income and claimed deduction of ₹ 2,72,65,500/- u/s 80G. Further, Assessee Company has also contributed a sum of ₹ 4,75,53,518/- towards Corporate Social Responsibility (CSR) and as per the provisions of section 37 of the Act, offered the same for tax vide para 2h of Computation of Income. However, CSR contribution of ₹ 1,63,35,033/- was eligible and specifically allowable u/s 80G of the Act, accordingly your Assessee Company has correctly claimed ₹ 81,67,517- u/s 80G of the Act. It may kindly be, therefore, appreciated that during the year Assessee Company has added back total ₹ 6,88,66,033/- (₹ 5,25,31,000/- as donation + ₹ 1,63,35,033/- as CSR) and claimed total deduction of ₹ 3,54,33,017/- (₹ 2,72,65,500/- + ₹ 81,67,517/-) of the Act. In view of aforesaid submissions and facts, your goodself will kindly appreciate that Assessee Company has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... file application in Form 3CF -II every year. As per sub-rule (11) of Rule 5C, the Central Government may withdraw the approval granted under clause (ii) of sub-section (1) of section 35 if it is satisfied that the research association or university or college or other institution has ceased its activities or its activities are not genuine or are not being carried out in accordance with all or any of the conditions under rule 5D. No such order to withdraw the approval u/s 35(1)(ii) has been passed in PSRI case. Rule 5D of the Income Tax Rules provides the following conditions subject to which approval is to be granted to a research association under clause (ii) or clause (iii) of sub-section (1) of section 35..... From perusal of aforesaid provisions, it may kindly be noted that Assessee Institute required to maintain separate Books of Account and to file, each year, certain details relating to audit reports, statement of sum received and sum applied etc. It is submitted that PSRI is filing the said details as required by Rule 5D each year. Copy of acknowledgement dt. 19/09/2016 of details filed for FY 2015-16 relating to AY 2016-17 is enclosed herewith as Annexure ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, the institution has to make an application in the prescribed form (Form-3CF-II) to the Central Govt. for its approval. However, in absence of required approval by the Central Govt. on record it cannot be ascertained whether the contribution to the said Institution was eligible for deduction u/s.35(1)(ii) of the Act for A.Y. 2016-17. The A.O. has passed the assessment order without making enquiries or verification which should have been made in the instant case. Clause (a) and Clause (b) of Explanation-2 to Section 263(1) is attracted in this case. Accordingly, it is held that the assessment order is erroneous in so far as it is prejudicial to the interest of revenue. 5. For the reasons given above and by relying on certain judicial pronouncement referred to and discussed in his impugned order, the ld. Pr. CIT set aside the order of the Assessing Officer dt. 27/12/2018 passed u/s 143(3) of the Act by treating the same as erroneous as well as prejudicial to the interest of the revenue with a direction to the Assessing Officer to pass fresh assessment order after considering the issues raised by him as per law and after giving an opportunity of being heard to the assessee. Ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear from the relevant details available on record before the Assessing Officer and since the entire amount of donation of ₹ 6,88,66,033/- was added back to the assessee company to the computation of total income, there was no error in the order of the Assessing Officer in allowing the same. 8. As regards the third error allegedly pointed out by the ld. Pr. CIT, the ld. Counsel for the assessee submitted that the approval in Form 3CF-II from the Central Government is required to be obtained by the Institute only once at the initial stage and the same was duly obtained by M/s. Pushpawati Singhania Research Institute, New Delhi, in the year 2007. She invited out attention to the provisions of Rule 5C 5D of the Income Tax Rules, 1962 (hereinafter the Rules ) to point out that the concerned Institution after obtaining approval initially is only required to submit a statement giving certain details and such statement was duly filed by the M/s. Pushpawati Singhania Research Institute for the year under consideration on 29/09/2016 with the concerned DIT (Exemption) (copy placed at page 129 of the paper book). She contended that this position was clearly brought to the notice of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard the rival submission and also perused the relevant material available on record. In the present case the assessment order for the year under consideration was completed by the Assessing Officer u/s 143(3) of the Act vide order dt. 27/12/2018. On examination of the relevant assessment records the ld. Pr. CIT was of the view that the said assessment order passed by the Assessing Officer u/s 143(3) suffered from three errors and accordingly a notice u/s 263 of the Act was issued by him to the assessee pointing out the said errors and seeking explanation of the assessee as to why the order passed by the Assessing Officer u/s 143(3) should not be revised by exercising the powers conferred upon him u/s 263. The errors so pointed out by the ld. Pr. CIT in the notice u/s 263 already extracted by us in para 2 of this order and a perusal of the same shows that the order passed by the Assessing Officer u/s 143(3) was found to be erroneous by the ld. Pr. CIT on merit and then the reply filed to the notice issued by him u/s 263, a written submission was made by the assessee to show that there were no such errors in the order of the Assessing Officer passed u/s 143(3) of the Act on merits. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matters, to remand the matter/issue to the Assessing Officer would imply and mean that the CIT has not examined and decided whether or not the order is erroneous but has directed the Assessing Officer to decide this aspect/question. In the case of Infinity Infotech Park Ltd. vs DCIT 58 ITR (Trib) 486 cited by the learned counsel for the assessee, there was no allegation in the show cause notice issued under section 263, like in the present case, that there was failure on the part of the Assessing Officer to make proper and adequate enquiries before completing the assessment and the allegation was that the Assessing Officer has formed a wrong opinion or finding on merits. In reply to the notice issued under section 263, the assessee filed a detailed reply on January 12, 2017. On the very same day, the commissioner passed an order under section 263 setting aside the order of the A.O. on the ground of lack of enquiry. In these facts and circumstances involved in the case of Infinity Infotech Park Ltd. (supra), the Coordinate Bench of this Tribunal held that the Ld. CIT before exercising jurisdiction under section 263 of the Act by setting aside the order of the Assessing Officer ought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pened: i) in common course of natural events ; ii) according to general human conduct; iii) according to public and private business; iv) due to the relation to the facts of the particular case. Accordingly, the Court can presume the existence of that fact i.e. in this case we take the aid of illustration (e) to section 114 of the Indian Evidence Act, which helps us presume judicial and official acts have been regularly performed . So we presume in the facts and circumstances, and after going through the relevant pages of the PB that AO has regularly performed his duties. Since from perusal of the papers filed before the AO itself (PB) we are convinced that there was no error as wrongly assumed by Ld. PCIT. Therefore the Ld. PCIT erred in assuming revisional jurisdiction to interfere with the action of AO. For the aforesaid action of ours, we also rely on the ratio of the decision of the Co-ordinate Bench in the case of Infinity Infotech Park Ltd. vs DCIT (supra), which is also applicable in the present case and therefore, we hold that the impugned order passed by the ld. Pr. CIT u/s 263 of the Act is without jurisdiction and so liable to be quashed. 13. In the result, appeal o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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