C/TAXAP/151/2020 ORDER IN HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 151 of 2020 PRINCIPAL COMMISSIONER OF INCOME TAX-2 Versus ELITECORE TECHNOLOGIES PVT. LTD. Appearance: MRS MAUNA M BHATT(174) for Appellant(s) No. 1 for Opponent(s) No. 1 CORAM: HONOURABLE CHIEF JUSTICE MR. VIKRAM NATH and HONOURABLE MR. JUSTICE J.B.PARDIWALA Date : 10/09/2020 ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1. This tax appeal under Section 260A of Income Tax Act, 1961 is at instance of revenue and is directed against order passed by Income Tax Appellate Tribunal, B Bench, Ahmedabad dated 04.09.2019 in ITA No.1356/Ahd/2016 for A.Y. 2009-10. Revenue has proposed solitary question of law for consideration of this Court. same reads thus; "Whether Appellate Tribunal has erred in law and on facts by setting aside and quashing order passed by Principal Commissioner of Income Tax under section 263 of Act?" 2. It appears from materials on record that assessee filed its return of income for A.Y.2009-10 on 27.09.2009, declaring its total income at Rs. Nil and claimed deduction of Rs.3,96,60,132/- under Section 10A of Act, 1961 as well as set off of business loses to tune of Rs.2,91,07,555/- for A.Y.2008-09 against income of Page 1 of 3 Downloaded on : Wed Sep 30 07:53:03 IST 2020 C/TAXAP/151/2020 ORDER year under consideration. assessee also claimed carry forward business loss of Rs.3,70,52,213/- pertaining to A.Y.2008-09 for set off in subsequent years. assessment was completed in accordance with above claim. tax came to be paid under MAT for income of Rs.4,77,79,483/- under Section 115JB of Act. 3. For year under consideration, assessee claimed deduction of Rs.3,96,60,132/- under Section 10A of Act. asseesseee had set off business loss of Rs.2,91,07,555/- pertaining to A.Y.2008-09 against income of current year. 4. Principal Commissioner took up assessment order in suo motu revision in exercise of his powers under Section 263 of Act on ground that assessment order was erroneous and prejudicial to interest of Revenue. Principal Commissioner took view that Assessing Officer had failed to follow principle of carry forward and set off as brought out in Section 10A of Act. 5. Principal Commissioner, vide order dated 30th March, 2016, set aside order passed by Assessing Officer under Section 143(3) read with Section 144C of Act and directed Assessing Officer to re-frame assessment after conducting necessary inquiry. 6. assessee, being dissatisfied with order passed by Principal Commissioner, referred to above, preferred appeal before Appellate Tribunal. assessee succeeded before Appellate Tribunal. Appellate Tribunal allowed appeal filed by assessee and set aside order passed by Principal Commissioner. Appellate Tribunal, while allowing appeal of assessee, held as under; Page 2 of 3 Downloaded on : Wed Sep 30 07:53:03 IST 2020 C/TAXAP/151/2020 ORDER "In view of ratio laid down by Hon ble Jurisdictional High Court that deduction u/s 10A has to be allowed before set off of unabsorbed loss and depreciation of non-eligible business unit of assessee. We find no justification in such order passed by Learned PCIT who has not taken into consideration this particular aspect of matter though same was brought to his notice by assessee by and under reply dated 21.03.2016 hence relying upon ratio laid down by Jurisdictional High Court as discussed above, we find no justification in order impugned before us which has re-opened issue u/s 263 of Act whereas, we find that order passed by Learned A0 is just and proper and in terms of ratio laid down by Jurisdictional High Court. There is nothing erroneous found in order of Learned AO, neither it is prejudicial to instant of Revenue. None of conditions is being fulfilled by order passed by Learned PCIT in order to invoke provision of section 263 of Act in order to reopen assessment of appellant company. Hence, order impugned is being devoid of merit and thus quashed." 7. Having heard Ms. Bhatt, learned senior counsel appearing for Revenue and having gone through materials on record, we see no good reason to disturb order passed by Appellate Tribunal. 8. In result, this appeal fails and is hereby dismissed. (VIKRAM NATH, CJ) (J. B. PARDIWALA, J) Vahid Page 3 of 3 Downloaded on : Wed Sep 30 07:53:03 IST 2020 Principal Commissioner of Income-tax-2 v. Elitecore Technologies Pvt. Ltd