Smt. Suchita Goyal Vs PCIT (ITAT Delhi)
Mere Change of Opinion Not Enough: Delhi ITAT Quashes s.263 Revision on Interest Deduction u/s 24(b)
Delhi ITAT set aside the revisionary order passed u/s 263, holding that the assessment order allowing deduction of interest on borrowed capital u/s 24(b) was neither erroneous nor prejudicial to the interests of the Revenue.
The PCIT had invoked s.263 on the ground that the AO wrongly allowed interest deduction of ₹96.01 lakh on borrowed capital for house property, alleging absence of an interest certificate from the lender and lack of nexus between the loan and the property. The Tribunal noted that the AO had examined the issue during scrutiny and accepted the Assessee’s explanation that an existing loan on an earlier property was transferred to the property from which rental income was offered in the relevant year.
The ITAT observed that complete loan documents establishing nexus were available on record and that the interest certificate from the bank, though obtained later, conclusively showed recovery of interest during the year. Holding that faulting the assessment order for non-availability of a document at the assessment stage—when the substantive facts were otherwise verified—would amount to a mere academic exercise, the Tribunal ruled that the PCIT had only substituted his opinion for that of the AO.
Accordingly, the ITAT held that the twin conditions for invoking s.263 were not satisfied and quashed the revisionary order. The appeal of the Assessee was allowed.
FULL TEXT OF THE ORDER OF ITAT DELHI
