LSI India Research & Development Pvt. Ltd Vs PCIT (ITAT Bangalore)
ITAT Bangalore held that revisionary proceeding by PCIT under section 263 of the Income tax Act treating assessment order erroneous and prejudicial to interest of revenue upheld since assessee could not demonstrate that the equipment’s were received on returnable basis.
Facts- The assessee has received certain capital assets amounting to Rs. 42,89,70,248/- on free of cost/loan basis from holding/ subsidiary companies. These fixed assets, according to the ld. PCIT u/s 263 of the Act, were representing the income of the assessee as provided u/s 28(iv) of the Act. However, the assessee has not offered the same to the income in the return filed u/s 139 of the Act. Similarly, the assessment has been framed without any enquiry from the assessee so as to offer such free of cost equipment as income under clause (iv) of sec. 28 of the Act. Accordingly, PCIT u/s 263 proposed to hold the assessment order as erroneous in so far prejudicial to the interest of revenue.
The only issue raised by the assessee is that PCIT u/s. 263 of the Act has erred in holding the assessment framed u/s 143(3) r.w.s. 144(3) r.w.s 144B of the Act as erroneous in so far as prejudicial to the interest of the revenue and further directing the AO to make a fresh assessment in accordance with law.
