DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD vs. RCC LABORATORIES INDIA PRIVATE LIMITED, HYDERABAD

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ITA 1641/HYD/2017Status: DisposedITAT Hyderabad05 June 2018AY 2011-123 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal noted that the ITAT had previously set aside the CIT's order under Section 263. Consequently, the consequential assessment order passed under Section 143(3) read with Section 263 could not be sustained. The CIT(A)'s order allowing the assessee's appeal was upheld.

What were the facts?

The assessee company, engaged in pre-clinical drug testing, filed its return of income for AY 2011-12 showing Nil income after set off of losses. The AO accepted the return. Subsequently, the CIT initiated proceedings under Section 263, directing the AO to redo the assessment.

What were the issues?

Whether the assessment order passed under Section 143(3) read with Section 263 is valid when the order under Section 263 itself has been set aside.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD BENCH “B”, HYDERABAD

Before: SMT. P. MADHAVI DEVI & SHRI S. RIFAUR RAHMAN

For Appellant: Shri P
For Respondent: Smt. N. Swapna, Shri P

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “B”, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA No. 1641/Hyd/2017 Assessment Year: 2011-12 Dy. CIT, vs. RCC Laboratories India Circle-3(1), Pvt Ltd., Hyderabad. Hyderabad. PAN – AADCR1813J

(Applicant) (Respondent) Revenue by : Smt. N. Swapna Assessee by : Shri P. Murali Mohana Rao Date of hearing : 05-06-2018 Date of pronouncement : 05-06-2018 ORDER PER P. MADHAVI DEVI, J.M.: This is Revenue’s appeal for the A.Y 2011-12 against the order of the CIT(A)-3, Hyderabad, dated 20.07.2017.

2.

Brief facts of the case are that the assessee company, engaged in the business of pre-clinical testing of drugs, filed its return of income for the A.Y 2011-12 on 30.09.2011, admitting total income at Rs. Nil, after set off of carried forward business losses of Rs. 5,74,61,053/-. The A.O accepted the returned income of the assessee in the assessment completed u/s 143(3) of the Act.

2 ITA.No. 1641/Hyd/2017 RCC Laboratories, Hyderabad. 3. Subsequently, the CIT assumed jurisdiction u/s 263 of the Act and perused the assessment records and passed an order u/s 263 of the IT Act directing the A.O to redo the assessment. Consequently, the A.O passed the assessment order u/s 143(3) r.w.s 263 of the IT Act, against which, the assessee filed an appeal before the CIT(A), who allowed the same and the revenue is in appeal before us in this appeal.

4.

At the time of hearing, the Ld. Counsel for the assessee submitted that the order u/s 263 of the IT Act was challenged by the Assessee before the ITAT and the ITAT has set aside the order u/s 263 of the IT Act and consequently the order u/s 143(3) r.w.s 263 of the IT Act is to be set aside, as rightly done by the CIT(A). The copy of the order of the ITAT in ITA Nos. 459 & 1259/Hyd/2016 dated 28.04.2017 has been filed before us.

5.

Taking the same into consideration, we find that the basis for the assessment order u/s 143(3) r.w.s 263 of the IT Act i.s the order u/s 263 of the IT Act has been set aside by the Tribunal, and therefore the consequential assessment order cannot be sustained. In view of the same, we see no reason to interfere with the order of the CIT(A). Accordingly Revenue’s appeal is dismissed.

3 ITA.No. 1641/Hyd/2017 RCC Laboratories, Hyderabad. 6. In the result the appeal filed by the Revenue is dismissed.

Pronounced in the open court on 05th June, 2018.

Sd/- Sd/- (S. RIFAUR RAHMAN) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER

Hyderabad, Dated: 05th June, 2018 KRK 1) RCC Laboratories Ind Pvt Ltd., Genome Valley, Turkapally, Shameerpet Mandal, Hyderabad-78. 2) Dy. CIT, Circle-3(1) Hyderabad. 3) CIT(A)-3, Hyderabad 4) Addl.CIT, Range-3as, Hyderabad. 4) The Departmental Representative, I.T.A.T., Hyderabad. 5) Guard File.

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