JSIW INFRASTRUCTURE PVT. LTD.,AHMEDABAD vs. THE PCIT-1, AHMEDABAD

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ITA 621/AHD/2025Status: HeardITAT Ahmedabad14 August 2025AY 2020-21Bench: DR. B.R.R. KUMAR, VICE-PRESIDENT SHRI SIDDHARTHA NAUTIYAL (Judicial Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found the PCIT's observation that the interest on income tax was not disallowed by the assessee in its ITR to be factually incorrect based on the record. The Tribunal concluded that the AO had conducted sufficient inquiry, and the PCIT's order under Section 263 was therefore quashed.

What were the facts?

The assessee filed an appeal against an order passed by the Principal Commissioner of Income Tax (PCIT) under Section 263 of the Income Tax Act. The PCIT had set aside the Assessing Officer's (AO) order, alleging that the AO had not made proper inquiries regarding the allowability of expenses, specifically interest on income tax amounting to Rs.99,37,893/-.

What were the issues?

Whether the PCIT erred in initiating proceedings under Section 263 when the Assessing Officer had already conducted proper verification and the PCIT's grounds were factually incorrect?

Which sections of the Income-tax Act were involved?

Section 263,Section 142(1),Section 37

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

For Appellant: Shri Parin Shah, AR
For Respondent: Shri RP Rastogi, CIT. DR
Hearing: 13.08.2025Pronounced: 14.08.2025

(Assessment Year: 2020-21) JSIW Infrastructure Pvt. Ltd., The Principal Vs. 4, Asra Mitra Estate, Commissioner of B/H Jupiter Mill, Income Tax-1, Dudheswar Road, Ahmedabad. Ahmedabad-380004. [PAN :AABCJ8501 F] (Appellant) .. (Respondent) Appellant by : Shri Parin Shah, AR Respondent by: Shri RP Rastogi, CIT. DR Date of Hearing 13.08.2025 Date of Pronouncement 14.08.2025 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-

This appeal is filed by the Assessee against the appellate order dated 05.03.2025 passed by the Principal Commissioner of Income Tax, Ahmedabad, relating to the Assessment Year 2020-21.

2.

The assessee has raised the following grounds of appeal:

1.

The order passed by PCIT is bad in law and required to be quashed.

2. Ld. PCIT erred in law and on facts in initiating proceedings u/s.263 of the Act ignoring fact that issue raised in show cause notice u/s.263 of the Act has been properly verified by AO during scrutiny assessment proceedings.

JSIW Infrastructure Pvt. Ltd Vs. PCIT Asst. Year 2020-21 - 2– 3. The Ld. PCIT erred in law and on facts in proceedings with revision jurisdiction ignoring fact that order passed by AO is neither erroneous not prejudicial to the interest of revenue.

4. The PCIT erred in law and on facts in setting aside the order by observing that proper inquiry for claim of allowability of expenses was not made ignoring fact that the case selected for scrutiny to verify the allowability and after sufficient inquiry AO allowed deduction.

5. Ld. PCIT erred in observing that AO passed an order without making any enquiry ignoring notices u/s.142(1) of the Act and it’s replied by appellant.

3.

We have examined the records before us and heard the arguments of both parties. The relevant pages required for adjudication of these issues are as follows:

 Page No. 404 of the paper book(Form No.3CD), Column 21, titled “Expenditure by way of penalty or fine for violation of any law for the time being in force”, reflects particulars described as “Interest on Income Tax” amounting to Rs.99,37,893/-.  Page No. 166 of the ITR filed by the assessee (vide Acknowledgment No. 252857101120221) for Assessment Year 2020-21, Column No. 15 “Amounts debited to the profit and loss account, to the extent disallowable under section 37”, reflects an amount of Rs.2,07,68,408/-.  Page No. 117 of the paper book, titled “Computation of Total Income”, shows disallowances under section 37 of Rs.99,37,893/- towards interest on income tax, along with other expenditures such as personal expenditure, corporate social responsibility, donation, and loss on sale of assets, amounting in total to Rs.2,07,68,408/-.

JSIW Infrastructure Pvt. Ltd Vs. PCIT Asst. Year 2020-21 - 3–  Page No. 87 of the paper book contains the detailed break-up of Rs.2,07,68,408/-, which includes the interest on income tax received by the assessee.

4.

The Ld. PCIT set aside the order of the Assessing Officer on the grounds that the interest on income tax of Rs.99,37,893/- had not been disallowed by the assessee in its ITR. However, after hearing the arguments of both parties and perusing the paper book, we find this observation to be factually incorrect based on the record. Accordingly, the order passed under section 263 of the Act by the Ld. PCIT is hereby quashed.

5.

In the result, the appeal filed by the assessee is allowed.

The order is pronounced in the open Court on 14.08.2025.

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