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| The Tax Publishers2019 TaxPub(DT) 6224 (Ahd-Trib) INCOME TAX ACT, 1961
Section 263
CIT had not brought anything on record suggesting that interest expenditure had not been incurred for the purposes of business, be it assessee's business or business of the partnership-firm where assessee was a majority stake holder. Accordingly, expenditure was rightly allowed by AO and assessment order could not be held as erroneous and prejudicial.
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Revision under section 263 - Erroneous and prejudicial order - No disallowance by AO of expenditure in assessee's hands of expenditure allocated to partnership-firm -
CIT under section 263 held assessment as erroneous in so far as prejudicial to the interest of revenue to the extent of non-disallowance of R&D expenditure allocated to Sun Pharmaceutical Industries (partnership-firm).Held: There was no denying by CIT that entire Research and Development activities were done by assessee company only being the flagship company of Sun Pharma Group. Assessee company had assisted the partnership firm in carrying on its business by using its network for marketing pharmaceuticals products successively. Since assessee was holding 97.5% of share in partnership firm, SPI it become duty of assessee to promote business of partnership firm in the capacity of majority stake holders. Incidentally, CIT had not brought anything on record suggesting that expenditure had not been incurred for the purposes of business, be it assessee's business or business of the partnership-firm where assessee was a majority stake holder. Accordingly, expenditure was rightly allowed by AO and assessment order could not be held as erroneous and prejudicial.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2008-09
IN THE ITAT, AHMEDABAD BENCH
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