TMI Blog2023 (5) TMI 1171X X X X Extracts X X X X X X X X Extracts X X X X ..... s 263 of the Act is not available to PCIT in the case of debatable issue. As in the case of Kishorebhai Bhikhabai Virani [ 2015 (2) TMI 807 - GUJARAT HIGH COURT has been referred to by the Co-ordinate Benches namely Raptakos Brett Co. Ltd. [ 2015 (6) TMI 529 - ITAT MUMBAI] and M/s Rare Investments [ 2019 (11) TMI 634 - ITAT MUMBAI] and after considering the same, the issue was decided in favour of the assessee. On the issue of non-availability of jurisdiction u/s 263 in case of debatable issue, we find support from the decision of Malabar Industrial Co. Ltd.[ 2000 (2) TMI 10 - SUPREME COURT] wherein it has been held that jurisdiction u/s 263 of the Act cannot be assumed in respect of a debatable issue which is reiterated in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the unabsorbed balance loss to be carried forward for future set off. According to Ld. PCIT, the loss on which STT was paid could not be adjusted against the long term capital gain on mutual fund (non-STT paid) in view of the provisions of Section 10(38) of the Act as the long term capital loss (STT paid ) is a negative income. Accordingly the Ld. PCIT issued show cause notice u/s 263 of the Act and after taking into account the reply to the show cause notice passed an order u/s 263 of the Act dated 29.03.2022 setting aside the assessment order and directing the AO to frame the assessment afresh after taking into consideration the observations as made in the order passed u/s 263 and after affording a reasonable opportunity of hearing to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re Investments vs. CIT (supra) and after considering the decision of the High Court, the issue was decided in favour of the assessee. The Ld. A.R therefore submitted that the issue is highly debatable as the AO has taken a view in favour of the assessee when the decisions are available both in favour of the assessee and against the assessee. The Ld. A.R also relied on the decisions of the Hon ble Apex Court in the case of Malabar Industrial Co Ltd.Vs CIT (2000)243 ITR 86(SC) and CIT Vs Max India Ltd (2007)295 ITR 282(SC) to defend his arguments that on debatable issue revisionary jurisdiction u/s 263 of the Act is not available. The ld AR further argued that Hon ble Delhi High Court in the case of CIT vs. Sunil Lamba in ITA 465/2003 dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereby that there are two views possible on the above issue. Thus we find merit in the arguments of ld AR that AO has taken one of the tow possible view while framing the assessment u/s 143(3) dated 1.5.2019 accepting the claim of the assessee in which the long term capital loss (STT paid) has been allowed to be set off and carried forward for future set off. In our considered view, the issue is debatable one and therefore jurisdiction u/s 263 of the Act is not available to the ld PCIT in the case of debatable issue. We also note that the above decision of Hon ble Gujarat High Court in the case of Kishorebhai Bhikhabai Virani (supra) has been referred to by the Co-ordinate Benches namely Raptakos Brett Co. Ltd. vs. DCIT (supra) and M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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