Aarvee Denims & Exports Ltd. Vs. The Pr.CIT

Parties Involved

Facts Summary

The assessee, Aarvee Denims & Exports Ltd., filed its return of income for the Assessment Year 2018-19 declaring NIL income after claiming deductions under section 80IA of the Income Tax Act. The Assessing Officer (AO) made additions of Rs.42,06,604/- and Rs. 3,15,44,000/- under sections 143(1) and 40(a)(i) of the Act, respectively. The Principal Commissioner of Income Tax (PCIT) invoked revisionary jurisdiction under Section 263 of the Act, setting aside the assessment order passed by the AO, directing a fresh assessment. The assessee appealed against the PCIT's order, arguing that the assessment order was neither erroneous nor prejudicial to the interest of the revenue. The Tribunal considered the submissions of both parties and held that the PCIT's order was unjustified as the AO had thoroughly reviewed the relevant details and the assessment order was not prejudicial to the revenue.…

Legal Issues

• 1. Whether the order passed by the PCIT under Section 263 of the Act, directing the AO to make a fresh assessment, was justified?

Judgment Outcome

Decided in favour of Partly Assessee / Partly Revenue.

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