The Income Tax Appellate Tribunal (ITAT), Mumbai Bench while ruling in favor of Bank of India held that Principal Commissioner of Income Tax (PCIT) cannot form another view on the same issue in which the Assessing Officer has already satisfied himself and passed an order which clearly indicates that the Assessing Officer has verified and investigated the matter in detail.
The PCIT had held that the assessee, Bank of India had claimed excess bad debts under section 36(1)(vii) of Rs.2619,63,00,000/- without reducing the opening credit balance of Rs.2078,70,00,000, that is the amount of deduction allowed under section 36(1)(viia) in the A.Y.2014-15 and the same was wrongly allowed by the Assessing Officer.
The ld. PCIT further proceeded to hold that the actual deduction allowable under section 36(1)(vii) works out to Rs.540,93,00,000. Accordingly, he held the assessment order passed by the Assessing Officer is erroneous and prejudicial to the interest of the revenue and directed the Assessing Officer to restrict the addition under section 36(1)(vii) and determine the total income accordingly.
The only issue to be decided in this appeal is as to whether the Principal Commissioner of Income Tax (PCIT) was justified in invoking his revisionary jurisdiction under section 263 of the Act in the facts and circumstances of the instant case with regard to provision for bad and doubtful debts under section 36(1)(viia) of the Act.
The Coram consisting of Ravish Sood and M.Balaganesh clarified that deduction claimed under Section 36(1)(vii)and 36(1)(viia) of the Act, the assessee has filed detailed submissions before the Assessing Officer and the Assessing Officer has considered the submissions even though he has not discussed it in his order under Section 143(3) of the Act.
The material submitted before the court clearly indicates that the assessee has made elaborate submissions on this issue and the Assessing Officer has satisfied himself that assessee is eligible to claim deduction under Section 36(1)(vii) and 36(1)(viia) of the Act.
Therefore, the court held that PCIT cannot form another view on the same issue in which the Assessing Officer has already satisfied himself and passed an order which clearly indicates that the Assessing Officer has verified and investigated the matter in detail. Therefore, even in this issue, the provisions of Section 263 of the Act cannot be invoked.
Subscribe Taxscan Premium to view the Judgment
