Kalpesh Dhanjibhai Makasana Vs PCIT (ITAT Ahmedabad)
Ahmedabad Tribunal in quashed a revision order passed u/s 263, holding that PCIT could not invoke revisionary powers on issues outside the scope of limited scrutiny.
Assessee, an individual & director in a private company, filed return declaring income of Rs.6.12 crores. The case was selected for limited scrutiny to verify deduction u/s 80G. AO issued notices, examined donation of Rs.65 lakhs made to a trust through banking channels, verified supporting evidence including 80G(5)(vi) approval, & accepted the return u/s 143(3).
PCIT on perusal found mismatch in salary figures, as employer showed Rs.3.6 crores remuneration whereas Assessee declared Rs.4.05 crores, leading to difference of Rs.45 lakhs. PCIT also noted no disallowance u/s 14A was made, though Assessee had investments. He held AO’s order erroneous & prejudicial & set it aside directing fresh assessment.
Assessee argued that AO’s jurisdiction was confined only to 80G deduction under limited scrutiny & could not examine unrelated issues without conversion to complete scrutiny. It was contended that salary difference arose due to company’s TDS error, later rectified by revised Form 16 & 26AS, & investments were out of non-interest-bearing funds. Reliance was placed on PCIT vs Green Park [2024] 301 Taxmann.com 617 (Guj.).
