ERIS LIFESCIENCES LIMITED,AHMEDABAD vs. THE PCIT, AHMEDABAD-1, AHMEDABAD

ITA 1037/AHD/2025Status: DisposedITAT Ahmedabad04 August 2025AY 2020-21Bench: SHRI SIDDHARTHA NAUTIYAL (Judicial Member), SHRI NARENDRA PRASAD SINHA (Accountant Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the PCIT's order under Section 263 was not sustainable as the AO had conducted a proper inquiry and taken a considered view. The PCIT failed to provide a justifiable rationale for enhancing the disallowance, and proceedings under Section 263 cannot be used merely to substitute the PCIT's opinion for the AO's.

What were the facts?

The Principal Commissioner (PCIT) invoked Section 263 to revise assessment orders for AY 2020-21 and 2021-22, believing the Assessing Officer (AO) erred in disallowing only 7.5% of promotional expenses. The PCIT proposed a higher disallowance of 12.5%, deeming the AO's order erroneous and prejudicial to revenue.

What were the issues?

Whether the PCIT correctly invoked Section 263 to revise the assessment order when the AO had conducted a proper inquiry and taken a considered view on the disallowance of promotional expenses.

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3),Section 144B,Section 37(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

Before: SHRI SIDDHARTHA NAUTIYAL & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri Biren Shah, AR
For Respondent: Shri R P Rastogi, CIT-DR
Hearing: 29.07.2025Pronounced: 04.08.2025

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

These are appeals filed by the Assessee for Assessment Years 2020- 21 & 2021-22 against order passed by Ld. Principal Commissioner of Income Tax-1, (in short “Ld. PCIT”), Ahmedabad under Section 263 of the Act dated 26.03.2025. Since common facts and issues for consideration are involved for both the years under consideration, both the appeals are being disposed of by way of a common order.

We shall first discuss the facts for A.Y. 2021-22 (ITA No. 1038/Ahd/2025) and our observations for this year shall apply to A.Y. 2020-21 as well

2.

The assessee has taken the f

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 263

All 13,616 judgments and leading authorities on Section 263 →

Recent GST High Court judgments

Search GST case law →