Case Law Details
Karumanchi Nalini Vs ITO (ITAT Visakhapatnam)
The Ld.AR, therefore, pleaded that the order passed by the Ld. Pr. CIT u/s 263 dated 24.03.202 1 is not valid in the eyes of law since the AO has examined and followed all the directions given by the Pr. CIT and passed the assessment order. Hence, the Ld.AR submitted that the order passed u/s 263 dated 24.03.2021 is not valid and pleaded that the order be quashed.
On the other hand, the Ld.DR argued that since the AO has not complied with the directions of the Ld. Pr. CIT, thus, proceedings u/s 263 were initiated again. Therefore, the order passed u/s 263 dated 03.2021 is valid under law and pleaded that the order passed u/s 263 dated 24.03.202 1 be confirmed.
We have heard both the parties and perused the material placed on Admittedly, the Ld. Pr. CIT has passed an order u/s 263 dated 06.03.2018 with a direction to examine whether the assessee is entitled for claiming exemption u/s 54F, since the assessee is having two residential properties and also offered rental income for the relevant assessment year. After issuance of notice and on physical verification of the residential properties, the AO opined that the property is not residential house and it is a small portion of construction and the assessee has let out the same and offered the income. Accordingly, the AO has completed the assessment dated 143(3) dated r.w.s. 263 dated 16.08.2018. Therefore, we are of the view that initiation of proceedings u/s 263 is incorrect and not permissible under law. Therefore, we hold that the assessment order passed u/s 143(3) r.w.s. 263 dated 16.08.2018 holds good and thus quash the order passed u/s 263 dated 24.03.2021. Therefore, the grounds raised by the assessee are allowed.
FULL TEXT OF THE ORDER OF ITAT VISAKHAPATNAM
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