Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Income Tax Act 1961 Exercise of jurisdiction under s.263 |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Act(s) Referred | Income Tax Act, 1961 (43 of 1961) |
Case(s) Referred | Referred Case 0 |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Income Tax Act, 1961 – s. 263 – Exercise of jurisdiction under – Respondent filed its income tax return for the AY 2007-08, wherein it showed sale of the property / building for an amount of Rs.33 Crores – According to the assessee, property was sold to discharge encumbrances from the sale proceeds to pay off the shareholders and therefore, the said discharge of encumbrances was “cost of improvement” – Assessment accepted by AO u/s. 143(3) – However, the Commissioner invoked jurisdiction u/s. 263 of the IT Act and held that the assessment order passed u/s.143(3) of the IT Act was erroneous and prejudicial to the interest of the revenue – Commissioner set aside the assessment order passed by the AO – ITAT concluded that the Commissioner wrongly invoked the jurisdiction u/s. 263 of the IT Act and upheld the allowability of the Assessee’s claim – Appeal against the ITAT’s order was dismissed by the High Court – On appeal, held: Applying the law laid down in the case of Malabar Industrial Co. Ltd. and on perusal of the the assessment order as well as the order passed by the Commissioner of Income Tax, the Court is of the opinion that the assessment order was not only erroneous but prejudicial to the interest of the Revenue also – In the facts and circumstances of the case, it cannot be said that the Commissioner exercised the jurisdiction u/s. 263 not vested in it – High Court committed a serious error – Impugned Judgment and order passed by the High Court set aside and that the order passed by the Commissioner passed in exercise of powers u/s. 263 of the Income Tax Act is restored. |
Judge | Hon'ble Mr. Justice M.R. Shah |
Neutral Citation | 2023 INSC 325 |
Petitioner | Commissioner Of Income Tax 7 |
Respondent | M/s Paville Projects Pvt. Ltd. |
SCR | [2023] 3 S.C.R. 310 |
Judgement Date | 2023-04-06 |
Case Number | 6126 |
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