SABARMATI GAS LIMITED,GANDHINAGAR vs. PR.CIT, AHMEDABAD-3, AHMEDABAD

ITA 1219/AHD/2025Status: DisposedITAT Ahmedabad24 December 2025AY 2020-21Bench: Ms. Suchitra Kamble (Judicial Member), Shri Narendra Prasad Sinha (Accountant Member)6 pages
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What did the Tribunal hold?

The Tribunal ruled that the PCIT's direction to verify rental expenses was beyond the scope of the Section 263 show-cause notice, which was limited to additional depreciation and CSR expenses. Furthermore, for the issues of additional depreciation and CSR expenses, the Assessing Officer had already conducted verifications and made disallowances, rendering the PCIT's intervention a mere 'change of opinion' and thus not sustainable. Consequently, the PCIT's order was deemed beyond the provisions of Section 263 and did not survive.

What were the facts?

The assessee appealed against a PCIT order under Section 263 which set aside the Assessing Officer's assessment and directed a fresh assessment. The PCIT ordered verification of additional depreciation claimed under Section 32(1)(iia), CSR expenses claimed under Section 80G, and rental expenses. The assessee argued that the PCIT's order regarding rental expenses exceeded the scope of the Section 263 show-cause notice, and for the other two issues, it constituted a mere 'change of opinion' as they were already examined by the AO.

What were the issues?

Whether a PCIT's order under Section 263 can exceed the scope of the show-cause notice by directing verification of new issues, and whether it can revise an assessment based on issues already examined by the Assessing Officer, constituting a mere change of opinion.

Which sections of the Income-tax Act were involved?

Section 263,Section 32(1)(iia),Section 80G

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “D” BENCH

Before: Ms. Suchitra Kamble & Shri Narendra Prasad Sinha

For Appellant: Shri S.N. Soparkar, Sr. A.R
For Respondent: Shri Ashesh Rajesh Rewar, CIT-D.R

Per Suchitra Kamble, Judicial Member:

This is an appeal filed against the order dated 30-03- 2025 passed by Principal Commission of Income, PCIT, Ahmedabad-3 for assessment year 2020-21. 2. The grounds of appeal are as under:- “1. The order passed by the PCIT is void-ab-initio as it constitutes an overreach of authority as per grounds of appeal attached.

2.

Disallowance of additional Depreciation u/s 32(1)(iia) of Rs. 29,54,60,265/- as per grounds of appeal attached. Sabarmati Gas Ltd., A.Y. 2020-21

3.

Disallowance of Deduction u/s 80G of Rs. 2,00,00,000/-as per grounds of appeal attached

4.

Disallowance of rental expense without providing opportunity of being heard as per grounds

The order continues below.

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