“Section 119(2)(6)”
The decision most relied on for Section 119(2)(6) is Swarup Vegetable Products v. CIT (187 ITR 412), cited in 63 judgments on BharatTax.
Leading authorities on Section 119(2)(6)
When an Assessing Officer accepts an assessee's claim without conducting proper inquiries or a full investigation, the Commissioner is justified in concluding that the assessment order is erroneous and prejudicial to the interest of the revenue, thereby warranting revision under Section 263.
If an assessee has applied for approval of a fund or exemption within a reasonable time, the exemption should not be denied due to delays in processing by the tax authorities. The taxing authorities erred in holding that gross receipts are taxable without allowing expenditure when exemption is denied.
The prescribed authority's failure to send intimation in Form 3CL does not disentitle an assessee from claiming deduction under section 35(2AB) of the Act. Amendments to Rule 6(7A) apply prospectively from July 1, 2016, meaning prior to this date, Form 3CL approval was not essential for the quantification of weighted deduction under section 35(2AB).
An assessment order is erroneous and prejudicial to the revenue if the Assessing Officer accepts the assessee's explanation without conducting proper enquiries into the genuineness of unsecured loans, debts, or other transactions. Mere filing of an explanation by the assessee is not sufficient, and the Assessing Officer must apply their mind and conduct verification.
A non-domestic company's Permanent Establishment (PE) in India cannot be taxed at a rate higher than that applicable to a domestic company carrying out the same activities, even considering retrospective amendments to tax treaties.
