Techno Electric & Engineering company Limited Vs PCIT (ITAT Kolkata)
Assessee, engaged in power & EPC business, filed return declaring ₹181.54 cr. AO completed scrutiny u/s 143(3) after verifying ICDS adjustments. PCIT invoked section 263 alleging that ₹91.97 lakh debited as anticipated loss on EPC contracts was wrongly allowed & that the assessment was erroneous & prejudicial to Revenue.
Assessee explained that anticipated losses were consistently adjusted in prior years & the net impact for AY 2020-21 actually increased taxable income by ₹91.97 lakh. ICDS compliance was specifically examined by AO during scrutiny & accepted after detailed verification.
Tribunal held that AO had made due inquiry & adopted a plausible view; hence the assessment was neither erroneous nor prejudicial. Once AO examines the issue & takes a lawful view, PCIT cannot revise merely on disagreement. Relying on Malabar Industrial Co. Ltd. (SC) & V-Con Integrated Solutions Pvt. Ltd. (SC), Tribunal quashed the 263 order.
Held: Revision u/s 263 invalid—AO had duly verified ICDS adjustments.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
This is an appeal preferred by the assessee against the order of the Pr. Commissioner of Income Tax, Kolkata-2, (hereinafter referred to as the “Ld. CIT(A)”] dated 11.03.2025 for the AY 2020-21.
