LIFESTYLE INTERNATIONAL PRIVATE LIMITED,INDIA vs. PRINCIPAL COMMISSIONER OF INCOME TAX – 2, BENGALURU

ITA 824/BANG/2026Status: DisposedITAT Bangalore23 July 2026AY 2021-2211 pages
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What were the facts?

The assessee's assessment order was reviewed by the Principal Commissioner of Income Tax (PCIT) under Section 263, who found it erroneous and prejudicial to revenue interest. The PCIT raised concerns about the verification of TDS on royalty payments and the allowability of provision for loyalty points.

What did the Tribunal hold?

The Tribunal held that the PCIT's order under Section 263 was not sustainable. The assessment order was not erroneous or prejudicial to the revenue as the assessee had provided plausible explanations and supporting documents, and the PCIT failed to demonstrate actual loss of revenue.

What were the issues?

Whether the PCIT erred in holding the assessment order as erroneous and prejudicial to revenue interest under Section 263, and whether the AO conducted adequate inquiries regarding royalty payments and loyalty provisions.

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3),Section 144B,Section 40(a)(iib),Section 194J,Section 195

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: WASEEM AHMED & SOUNDARARAJAN K.

PER WASEEM AHMED, ACCOUNTANT MEMBER:

This appeal is filed by the Assessee against the order of Ld. Principal Commissioner of Income Tax – 2 vide DIN: ITBA/REV/F/REV5/2025- 26/1083603209(1) dated 12-Dec-2025 for the Assessment Year 2021-22. ITA 824/BANG/2026

2.

The effective iss

The order continues below.

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