Deep Industries Ltd., Ahmedabad V. The CIT, Ahmedabad-1, Ahmedabad

ITA 350/AHD/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85777 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 12-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 04-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T P KRISHNA KUMAR
• Assessee Lawyers: KETAN H SHAH
• Keywords: Opportunity of being heard; Audit objection; Revised return
• Section: 143(3); 14A; 147; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD (BEFORE SHRI MUKUL KR. SHRAWAT, J.M. & SHRI ANIL C HATURVEDI, A.M.) I.T. A. NO. 350/AHD/2014 (ASSESSMENT YEAR: 2009-10) DEEP INDUSTRIES LTD. 6 TH FLOOR, ASTRON TOWER, OPP. FUN REPUBLIC, S.G. HIGHWAY, AHMEDABAD V/S THE COMMISSIONER OF INCOME TAX, AHMEDABAD-1, C-WING, 304, 3 RD FLOOR, PTARYSKSH KAR BHAVAN, AMBAWADI, AHMEDABAD (APPELLANT) (RESPONDENT) PAN: AAACD6915E APPELLANT BY : SHRI KETAN H. SHAH, A.R. RESPONDENT BY : SHRI T.P. KRISHNAKUMAR, SR. D .R. ( )/ ORDER DATE OF HEARING : 12-03-2015 DATE OF PRONOUNCEMENT : 20 -03-2015 PER SHRI ANIL CHATURVEDI,A.M. 1. THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT, AHMEDABAD-1, AHMEDABAD DATED 11.12.2013 FOR A.Y. 2009-10. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 3. ASSESSEE IS A COMPANY STATED TO BE ENGAGED IN THE B USINESS OF CHARTER HIRING OF NATURAL GAS COMPRESSORS, AIR COMPRESSORS AND TRA NSPORT CONTRACTOR. ASSESSEE FILED ITS REVISED RETURN OF INCOME ON 18.1 .2011 DECLARING TOTAL ITA NO 350/A HD/2014 . A.Y. 2009-10 2 INCOME OF RS. 4,24,37,290/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) VIDE ORDER DATED 26.12.2011 AND THE TOTAL INCOME WAS DETERMINED AT R S. 4,34,81,062/-. SUBSEQUENTLY, ON EXAMINING THE RECORDS OF ASSESSMEN T PROCEEDINGS, LD. CIT NOTICED THAT (I) ASSESSEE HAS WRONGLY CLAIMED DEDUC TION OF RS. 61,21,968/- U/S. 35D TOWARDS PUBLIC ISSUE EXPENSE INCURRED AFTE R COMMENCEMENT OF BUSINESS AND ACCORDING TO HIM, AS PER PROVISIONS OF SECTION 35D(II) FOR A.Y. 08-09 SUCH DEDUCTION IS ONLY AVAILABLE TO AN ASSESS EE FOR EXTENSION OF ITS INDUSTRIAL UNDERTAKING. (II) WHILE QUANTIFYING DISA LLOWANCE OF EXPENDITURE U/S. 14A READ WITH RULE 8D, INTEREST EXPENDITURE WA S CONSIDERED BY THE A.O AT RS. 41,32,115/- INSTEAD OF 2,62,65,901/-. HE WAS THEREFORE OF THE VIEW THAT THE ORDER OF THE A.O WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. HE ACCORDINGLY ISSUED NOTICE DATED 26.09.2 013 AND CALLED UPON THE ASSESSEE TO SHOW CAUSE AS TO WHY APPROPRIATE ORDER U/S. 263 BE NOT PASSED. IN RESPONSE TO THE AFORESAID NOTICE, ASSESSEE INTER ALIA OBJECTED TO THE INITIATION OF PROCEEDINGS U/S. 263 AND ON MERITS SU BMITTED THAT NO ERROR WAS COMMITTED BY THE A.O WHILE COMPUTING THE ASSESSMENT . THE SUBMISSIONS OF THE ASSESSEE WERE NOT FOUND ACCEPTABLE TO THE LD. C IT. HE WAS OF THE VIEW THAT (I) A.O HAD ERRED IN ALLOWING DEDUCTION OF IPO EXPENSE OF RS. 61,21,968/- IN CONTRAVENTION OF PROVISIONS OF 35D(1 ) & (II) A.O HAD ALSO ERRED IN CONSIDERING THE INTEREST EXPENSES OF RS. 4 1,32,115/- INSTEAD OF 2,62,65,901/- WHILE QUANTIFYING DISALLOWANCE U/S. 1 4A. HE THEREFORE HELD THE ASSESSMENT ORDER PASSED U/S. 143(3) DATED 26.12.201 1 TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND ACCORDIN GLY CANCELLED THE ASSESSMENT FRAMED AND DIRECTED THE A.O TO MAKE A FR ESH ASSESSMENT OF THE TOTAL INCOME OF THE ASSESSEE. AGGRIEVED BY THE AFOR ESAID ORDER OF LD. CIT, ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS;- ITA NO 350/A HD/2014 . A.Y. 2009-10 3 1. THE ID. COMMISSIONER OF INCOME TAX HAS ERRED IN LAW AND ON FACT IN PASSING ORDER U/S 263 OF THE I.T ACT EVEN THOUGH THE ASSESSING OF FICER'S ORDER HAS MERGED WITH THE ORDER OF ID. CIT. THE ORDER PASSED BY HIM IS WITHOU T JURISDICTION AND BAD IN LAW WHICH MAY BE SET ASIDE. 2. THE ID. COMMISSIONER OF INCOME TAX HAS ERRED IN LAW AND ON FACT IN CANCELING THE ENTIRE ASSESSMENT ORDER' AND DIRECTION TO MAKE FRES H ASSESSMENT ORDER OF THE APPELLANT EVEN THOUGH HE DISCUSSED THE VARIOUS JUDI CIAL PRONOUNCEMENTS. 3. THE ID. COMMISSIONER OF INCOME TAX HAS ERRED IN LAW AND ON FACT THAT THE ASSESSING OFFICER HAS ERRED IN DECIDING THE ISSUES RELATING T O DEDUCTION U/S 35D AND DISALLOWANCE U/S 14A AGAINST THE APPELLANT, EVEN TH OUGH THE ASSESSING OFFICER HAD VERIFIED THE ISSUES AT THE TIME OF ASSESSMENT PROCE EDINGS AND HAD DECIDED THE ISSUES AFTER CONSIDERING THE SUBMISSIONS MADE BY THE APPELLANT DURING THE ASSESSMENT PROCEEDINGS. 4. SUBSEQUENTLY, ASSESSEE VIDE LETTER DATED 08.11.2014 HAS RAISED AN ADDITIONAL GROUND WHICH READS AS UNDER:- 1. THE CIT-I HAS ERRED IN NOT APPRECIATING THE FACTS T HAT THE PROCEEDINGS U/S. 263 CANNOT BE INITIATED MERELY ON THE BASIS OF AUDIT OBJECTION , IF ANY, AND THEREFORE, THE PRESENT REVISION PROCEEDINGS, IS ITSELF BAD IN LAW, VOID AB INITIO, ILLEGAL AND LIABLE TO BE QUASHED. 5. BEFORE US, LD. A.R. SUBMITTED THAT IN THE PRESENT C ASE THE PRE-REQUISITE CONDITIONS SPECIFIED U/S. 263 WERE NOT SATISFIED AN D THEREFORE THE PROCEEDING, U/S. 263 LACKS JURISDICTION AND ARE BAD IN LAW. HE FURTHER SUBMITTED THAT CIT HAS STATED IN THE ORDER PASSED U/S. 263 THAT ASSESS EE IS ENGAGED IN PROVIDING EQUIPMENTS ON HIRE TO OIL EXPLORATION COMPANIES AND HENCE ASSESSEE IS NOT AN INDUSTRIAL UNDERTAKING AND ACCORDINGLY THE PUBLI C ISSUE EXPENSES INCURRED AFTER COMMENCEMENT OF BUSINESS CANNOT BE CLAIMED AS DEDUCTION U/S. 35D(1) OF THE ACT. LD. A.R. SUBMITTED THAT IN THE SHOW CAU SE NOTICE ISSUED BY LD. CIT, THAT THERE WAS NO MENTION THAT REVISION WAS RE QUIRED TO BE MADE ON A GROUND THAT ASSESSEE WAS HAVING HIRE INCOME. HE THE REFORE SUBMITTED THAT THE REVISION ORDER PASSED IS CONTRARY TO SHOW CAUSE NOTICE AND THEREFORE BAD IN LAW AND VOID. WITH RESPECT TO THE CLAIM U/S. 35D , HE SUBMITTED THAT IT IS ITA NO 350/A HD/2014 . A.Y. 2009-10 4 ALLOWABLE FOR 10 SUCCESSIVE PREVIOUS YEARS AS PER T HE PROVISO TO SECTION 35D(1). THE FIRST YEAR OF SUCH CLAIM WAS ASSESSMENT YEAR 2007-08 WHICH HAS BEEN ACCEPTED U/S. 143(1) AND NO ACTION U/S. 147 OR 263 HAS BEEN TAKEN IN A.Y. 2007-08 OR IN A.Y. 2008-09. HE THEREFORE SUBMI TTED THAT WHEN THE CLAIM HAS BEEN ALLOWED IN INITIAL YEARS AND WITHOUT ANY CHANGE IN FACTS, THE CLAIM CANNOT BE REJECTED IN SUBSEQUENT YEARS AND IT CANNOT BE SUBJECTED TO SECTION 263 IN SUBSEQUENT YEARS. HE FURTHER SUBMITT ED THAT FOR THE YEAR UNDER CONSIDERATION, A QUESTIONNAIRE WAS ISSUE BY THE A.O WHEREIN THE A.O HAD ASKED TO EXPLAIN AS TO WHY THE REVISED CLAIM U/S. 3 5D NOT BE DISALLOWED IN VIEW OF THE FACT THAT THE REVISED RETURN WAS FILED BEYOND THE TIME ALLOWED BY THE ACT. HE SUBMITTED THAT WITH RESPECT TO THE DISA LLOWANCE OF EXPENSES U/S. 14A IN THE QUESTIONNAIRE, THE ASSESSEE WAS ALSO ASK ED TO EXPLAIN AS TO WHY RULE 8D NOT BE APPLIED TO DISALLOW THE EXPENSES U/S . 14A. HE POINTED TO THE RELEVANT SHOW CAUSE PLACED AT PAGE 109 OF THE PAPER BOOK. IN RESPONSE TO THE QUERY RAISED BY THE A.O LD. A.R. SUBMITTED THAT, AS SESSEE HAD SUBMITTED ITS REPLY VIDE LETTER DATED 13 TH OCTOBER, 2011 WHICH IS PLACED AT PAGE 115 AND 116 OF THE PAPER BOOK. HE FURTHER SUBMITTED THAT TH E A.O AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE VARIOUS DEC ISIONS CITED IN THE ORDER, COMPUTED THE DISALLOWANCE U/S. 14A AT RS. 10,43,772 /-. WITH RESPECT TO THE REVISED CLAIM U/S. 35D, A.O DID NOT AGREE WITH THE REVISED COMPUTATION OF THE CLAIM. AGAINST NOT ALLOWING DEDUCTION UNDER 35D BY THE A.O, ASSESSEE HAD PREFERRED APPEAL BEFORE CIT(A) WHO VIDE ORDER D ATED 27.11.2013 ALLOWED THE REVISED CLAIM FOR A.Y. 08-09. THE LD. A .R. THEREFORE SUBMITTED THAT ON THE ISSUE OF DEDUCTION U/S. 35D AND DISALLO WANCE U/S. 14A WHILE FRAMING THE ASSESSMENT ORDER, SPECIFIC QUERY WAS RA ISED BY THE A.O AND THEREAFTER, AFTER CONSIDERING THE SUBMISSIONS OF TH E ASSESSEE AND AFTER APPLICATION OF MIND, THE ISSUE WAS DECIDED. HE THER EFORE SUBMITTED THAT SINCE ITA NO 350/A HD/2014 . A.Y. 2009-10 5 THE ISSUE HAS BEEN EXAMINED BY A.O. LD. CIT CANNOT RESORT TO REVISIONARY PROCEEDING U/S. 263. HE FURTHER PLACED RELIANCE ON THE DECISION OF GABRIAL INDIA PVT. LTD. 203 ITR 103, DECISION OF AHMEDABAD TRIBUNAL IN THE CASE OF CADILA HEALTHCARE AND INNOVATIVE SECURITIES. HE THE REFORE SUBMITTED THAT THE ORDER OF CIT NEEDS TO BE SET ASIDE BOTH ON THE GROU ND OF JURISDICTION AND ON FACTS. WITH RESPECT TO THE ADDITIONAL GROUND, HE SU BMITTED THAT THE REVISION HAS BEEN MADE ON THE BASIS OF AUDIT OBJECTION AND T HEREFORE IT IS BAD IN LAW AND FOR THE AFORESAID PROPOSITION, HE RELIED ON THE DECISION OF CHANDIGARH TRIBUNAL IN THE CASE OF JASWINDAR SINGH 150 TTJ 33 (UO) (CHD.) AND OTHER DECISIONS. THE LD. D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF LD. CIT. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS ABOUT THE INVOKING OF PROVISIONS OF SECTION 263 BY LD. CIT. 7. S. 263(1) OF THE ACT, THE POWERS UNDER WHICH LD. CI T HAS ASSUMED POWER FOR REVISION READS AS UNDER: THE COMMISSIONER MAY CALL FOR AND EXAMINE THE RECO RD OF ANY PROCEEDING UNDER THIS ACT, AND IF HE CONSIDERS THAT ANY ORDER PASSED THER EIN BY THE ITO IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, HE MAY, AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD AND AFTER MAKING OR CAUS ING TO BE MADE SUCH INQUIRY AS HE DEEMS NECESSARY, PASS SUCH ORDER THEREON AS THE CIR CUMSTANCES OF THE CASE JUSTIFY, INCLUDING AN ORDER ENHANCING OR MODIFYING THE ASSES SMENT, OR CANCELLING THE ASSESSMENT AND DIRECTING A FRESH ASSESSMENT. 8. THE READING OF THE ABOVE PROVISIONS MAKES IT VERY C LEAR THAT THE POWER OF SUO MOTU REVISION U/S 263(1) IS IN THE NATURE OF SU PERVISORY JURISDICTION AND THE SAME CAN BE EXERCISED ONLY IF THE CIRCUMSTANCES SPECIFIED THEREIN EXIST. ITA NO 350/A HD/2014 . A.Y. 2009-10 6 TWO CIRCUMSTANCES MUST EXIST TO ENABLE THE COMMISSI ONER TO EXERCISE POWER OF REVISION U/S 263, NAMELY (I) THE ORDER IS ERRONE OUS (II) BY VIRTUE OF BEING ERRONEOUS PREJUDICE HAS BEEN CAUSED TO THE INTEREST S OF THE REVENUE. 9. IN THE PRESENT CASE, IT IS SEEN THAT SECTION 263 HA S BEEN INVOKED ON TWO GROUNDS NAMELY DEDUCTION U/S. 35D AND DISALLOWANCE U/S. 14A. WITH RESPECT TO DEDUCTION U/S. 35D IT IS AN UNDISPUTED FACT THAT THE EXPENSES WERE INCURRED BY THE ASSESSEE IN THE YEAR ENDING 31 ST MARCH, 2007 RELEVANT TO ASSESSMENT YEAR 2007-08 AND THE FIRST YEAR OF CLAIM WAS A.Y. 2 007-08 AND IN THAT YEAR THE CLAIM OF THE ASSESSEE HAS BEEN ACCEPTED U/S. 14 3(1) AND NO ACTION U/S. 147 OR 263 HAS BEEN TAKEN IN FOR A.Y. 2007-08. FOR THE YEAR UNDER CONSIDERATION, FROM THE QUERY OF THE A.O RAISED DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS, IT IS SEEN THAT ASSESSEE IN THE REVISED RETURN HAD CLAIMED HIGHER DEDUCTION FROM THAT CLAIMED IN THE O RIGINAL RETURN. THE CLAIM OF ASSESSEE IN THE REVISED RETURN, AFTER CONSIDERIN G THE SUBMISSIONS OF THE ASSESSEE, WAS NOT FOUND ACCEPTABLE TO THE A.O AND H E THEREFORE GRANTED THE DEDUCTION AS PER THE ORIGINAL CLAIM MADE BY THE ASS ESSEE. WITH RESPECT TO THE DISALLOWANCE U/S. 14A, IT IS SEEN THAT THE QUER Y WAS RAISED DURING THE COURSE OF ASSESSMENT PROCEEDINGS TO WHICH THE ASSES SEE HAD REPLIED AND AFTER CONSIDERING THE REPLY OF THE ASSESSEE, A.O HA D CONSIDERED THE DISALLOWANCE U/S. 14A AT RS. 10,43,772/-. THUS IT CAN BE SEEN THAT BOTH THE ISSUES ON WHICH LD. CIT HAS REPORTED TO REVISIONARY PROCEEDINGS U/S. 263 HAS BEEN EXAMINED BY THE A.O. HERE WE WOULD LIKE TO REF ER TO THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. GA BRIAL INDIA LTD (1993) 203 ITR 108 (BOM) WHERE THE HONBLE BOMBAY HIGH COU RT HAS HELD AS UNDER:- ITA NO 350/A HD/2014 . A.Y. 2009-10 7 AN ORDER CANNOT BE TERMED AS ERRONEOUS UNLESS IT I S NOT IN ACCORDANCE WITH LAW. IF AN ITO ACTING IN ACCORDANCE WITH LAW MAKES CERTAIN ASS ESSMENT, THE SAME CANNOT BE BRANDED AS ERRONEOUS BY THE COMMISSIONER SIMPLY BEC AUSE ACCORDING TO HIM THE ORDER SHOULD HAVE BEEN WRITTEN MORE ELABORATELY. THIS SEC TION DOES NOT VISUALISE A CASE OF SUBSTITUTION OF JUDGMENT OF THE COMMISSIONER FOR TH AT OF THE ITO, WHO PASSED THE ORDER, UNLESS THE DECISION IS HELD TO BE ERRONEOUS. CASES MAY BE VISUALISED WHERE ITO WHILE MAKING AN ASSESSMENT EXAMINES THE ACCOUNTS, MAKES E NQUIRIES, APPLIES HIS MIND TO THE FACTS AND CIRCUMSTANCES OF THE CASE AND DETERMINES THE INCOME EITHER BY ACCEPTING THE ACCOUNTS OR BY MAKING SOME ESTIMATES HIMSELF. THE C OMMISSIONER, ON PERUSAL OF THE RECORDS, MAY BE OF THE OPINION THAT THE ESTIMATE MA DE BY THE OFFICER CONCERNED WAS ON THE LOWER SIDE AND, LEFT TO THE COMMISSIONER, HE WOULD HAVE ESTIMATED THE INCOME AT A HIGHER FIGURE THAN THE ONE DETERMINED BY THE ITO. THAT WOU LD NOT VEST THE COMMISSIONER WITH POWER TO RE-EXAMINE THE ACCOUNTS AND DETERMINE THE INCOME HIMSELF AT A HIGHER FIGURE. IT IS BECAUSE THE ITO HAS EXERCISED THE QUASI-JUDICIAL POWER VESTED IN HIM IN ACCORDANCE WITH LAW AND ARRIVED AT A CONCLUSION AND SUCH A CON CLUSION CANNOT BE TERMED TO BE ERRONEOUS SIMPLY BECAUSE THE COMMISSIONER DOES NOT FEEL SATISFIED WITH THE CONCLUSION. IT MAY BE SAID IN SUCH A CASE THAT IN THE OPINION OF T HE COMMISSIONER THE ORDER IN QUESTION IS PREJUDICIAL TO THE INTEREST OF THE REVENUE. BUT THAT BY ITSELF WILL NOT BE ENOUGH TO VEST THE COMMISSIONER WITH THE POWER OF SUO MOTU REVISIO N BECAUSE THE FIRST REQUIREMENT, NAMELY, THE ORDER IS ERRONEOUS, IS ABSENT. SIMILARL Y IF AN ORDER IS ERRONEOUS BUT NOT PREJUDICIAL TO THE INTEREST OF THE REVENUE, THEN AL SO THE POWER OF SUO MOTU REVISION CANNOT BE EXERCISED. ANY AND EVERY ERRONEOUS ORDER CANNOT BE SUBJECT-MATTER OF REVISION BECAUSE THE SECOND REQUIREMENT ALSO MUST BE FULFILL ED. 10. WE FIND THAT HONBLE APEX COURT IN THE CASE OF CIT VS. MAX INDIA LTD. 295 ITR 282 (SC) HAD HELD THAT WHERE TWO VIEWS ARE POSS IBLE AND ITO HAS TAKEN ONE VIEW WHICH LD. CIT DOES NOT AGREE THE ORDER OF A.O CANNOT BE TREATED AS ERRONEOUS ORDER PREJUDICIAL TO THE INTEREST OF REVE NUE UNLESS THE VIEW TAKEN BY THE A.O IS UNSUSTAINABLE IN LAW. WE FURTHER FIND THAT LD. CIT WAS OF THE VIEW THAT SECTION 35D WAS ONLY APPLICABLE TO AN IND USTRIAL UNDERTAKING AND ACTIVITY OF THE ASSESSEE CANNOT BE REGARDED AS AN I NDUSTRIAL UNDERTAKING AND THEREFORE NOT ELIGIBLE FOR DEDUCTION U/S. 35D. WE F IND THAT PRIOR TO A.Y. 2009-10, DEDUCTION WITH RESPECT TO 35D WITH RESPECT TO CERTAIN SPECIFIED PRELIMINARY EXPENSES WAS AVAILABLE TO AN INDUSTRIAL UNDERTAKING OR UNIT. HOWEVER, THE WORD INDUSTRIAL WERE OMITTED BY FINA NCE ACT, 2008 WITH EFFECT FROM 01.04.2009. THE EXPLANATORY NOTES TO TH E PROVISIONS OF FINANCE ACT, 2008 EXPLAINING THE AMENDMENT STATES AS UNDER: - ITA NO 350/A HD/2014 . A.Y. 2009-10 8 11. EXTENDING THE PROVISION OF SECTION 35D REL ATING TO AMORTIZATION OF PRELIMINARY EXPENSES TO ALL UNDERTAKINGS 11.1 SECTION 35D PROVIDES FOR DEDUCTION OF CERTAIN SPECI FIED PRELIMINARY EXPENSES. AFTER THE COMMENCEMENT OF BUSINESS, THE DEDUCTION WAS BEI NG ALLOWED TO ONLY AN INDUSTRIAL UNDERTAKING OR UNIT. IN ORDER TO PROVIDE A LEVEL PL AYING FIELD TO THE SERVICES SECTOR, THE SECTION HAS BEEN AMENDED TO PROVIDE THE BENEFIT OF AMORTIZATION TO ALL ASSESSEES AFTER COMMENCEMENT OF HIS BUSINESS, IN CONNECTION WITH TH E EXTENSION OF HIS UNDERTAKING OR IN CONNECTION WITH HIS SETTING UP A NEW UNIT. 11.2 APPLICABILITY: THIS AMENDMENT HAS BEEN MADE APPLICABLE WITH EFFECT FROM 1 ST APRIL, 2009 AND SHALL ACCORDINGLY APPLY FOR ASSESSMENT YEA R 2009-10 AND SUBSEQUENT ASSESSMENT YEARS. 11. THUS IT CAN BE SEEN THAT AFTER THE AMENDMENT MADE B Y FINANCE ACT 2008, BENEFIT OF 35D WAS ALSO AVAILABLE TO ASSESSEES WHO ARE NOT INDUSTRIAL UNDERTAKING AND THEREFORE WE DO NOT AGREE WITH THE CONTENTION OF LD. CIT THAT ASSESSEE WAS NOT ELIGIBLE FOR DEDUCTION U/S. 3 5D . BEFORE US, REVENUE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO DEMONSTRA TE THAT THE VIEW TAKEN BY THE A.O WAS AN IMPRESSIBLE VIEW, WAS CONTRARY TO LA W OR WAS UPON WRONG APPLICATION OF LEGAL PRINCIPLES INITIATING THE EXER CISING OF REVISIONARY POWERS U/S/ 263. IN VIEW OF THE AFORESAID FACTS, WE ARE OF THE VIEW THAT IN THE PRESENT CASE LD. CIT WAS NOT JUSTIFIED IN RESORTING TO REVI SIONARY POWERS U/S. 263 OF THE ACT, WE THEREFORE SET ASIDE THE ORDER OF CIT CA NCELLING THE ORDER DATED 26.12.2011 PASSED U/S. 143(3) OF THE ACT. THUS THE GROUNDS OF THE ASSESSEE ARE ALLOWED. 12. SINCE WE HAVE SET ASIDE THE ORDER OF LD. CIT CANCEL LING THE ASSESSMENT ORDER, WE ARE OF THE VIEW THAT THE ADDITIONAL GROUND RAISE D BY THE ASSESSEE HAS ITA NO 350/A HD/2014 . A.Y. 2009-10 9 BECOME ACADEMIC AND THEREFORE REQUIRES NO ADJUDICAT ION AND THEREFORE NOT ADJUDICATED. 13. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 20 - 03 - 2015. SD/- SD/- (MUKUL KR. SHRAWAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AH MEDABAD