Vitthaldas Nathubhai Shah Vs PCIT (ITAT Ahmedabad)
ITAT Ahmedabad Quashes 263 Revision on Political Donation – AO’s Enquiry Held Adequate; No Incriminating Material Linking Assessee – 263 Jurisdiction Invalid, Rules ITAT- Revision Cannot Replace AO’s Plausible View
Assessee filed return for AY 2020-21 declaring income of ₹1.01 crore. His case was scrutinized for verifying Chapter VI-A deductions. AO, after detailed enquiry u/s 142(1), accepted assessee’s claim of deduction of ₹15 lakh u/s 80GGC for donation made to Kisan Party of India, along with other deductions, & completed assessment u/s 143(3).
Subsequently, PCIT invoked revision u/s 263, holding that AO failed to disallow the donation to Kisan Party of India, which was subjected to search u/s 132 & found engaged in a bogus donation racket. PCIT alleged AO’s enquiry was inadequate & set aside assessment for fresh examination.
Before Tribunal, Assessee argued that (i) AO had specifically called for & verified donation receipts & bank statements, (ii) no incriminating material linking assessee’s donation to bogus entries was ever brought on record, & (iii) revision cannot be invoked to substitute PCIT’s opinion for AO’s plausible view. Reliance was placed on SC ruling in Malabar Industrial Co. Ltd. v. CIT (243 ITR 83), Gujarat HC rulings in Arvind Jewellers (259 ITR 502) & R.K. Construction Co. (313 ITR 65), & recent ITAT Ahmedabad decision in Gujarat Mineral Development Corporation Ltd v. PCIT [2025] 176 taxmann.com 227.
