Bombay High Court: CIT v. Impact Foundation [ITA No. 126/2024]
The Court dismissed the Deptt. Appeal against Impact Foundation holding that revisionary proceedings under the IT Act could not be sustained merely because the Commissioner believed the AO should have conducted further enquiry. The Court held that where the AO has examined an issue and taken a plausible view, the Commissioner cannot invoke revisionary powers simply because he holds a different opinion. Its case was selected for scrutiny, following which notices under Sections 143(2) and 142(1) were issued. During the assessment proceedings, the assessee furnished details from time to time. Subsequently, the CIT initiated revision proceedings under Section 263, alleging that the assessee had claimed utilisation of accumulated funds without proper proof, and that the AO had failed to verify the claim. The ITAT allowed the assessee’s appeal, finding that the AO had already examined the issue. The Revenue challenged order before the HC. Rejecting the appeal, the HC found that the assessee had already furnished details regarding utilisation of accumulated funds during the original assessment proceedings. The Court also held that the Commissioner had not independently conducted any enquiry to show that the assessing officer’s view was legally unsustainable. Accordingly, the High Court upheld the tribunal’s order and dismissed the Department appeal
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