COMMISSIONER OF INCOME TAX DELHI Vs. DLF LTD

JUDGEMENT

(1.) The Revenue in these appeals is aggrieved by orders of the Tribunal dated 7.11.2008 (in ITA No.2004/Del/2007) and dated 3.6.2009 (in ITA-1137/B/2009). The question of law sought to be urged is "Whether the Tribunal fell into error in holding that the provisions of Section-263 of the Act could not be invoked having regard to the facts and circumstances of the present case."

(2.) The facts in brief are that the assessee is in real estate and development business. For the assessment years 2002-03, its returned income was Rs. 11.44 Crores. The AO issued notice under Sections 143 (2) and 142 (1) eliciting information which was furnished. The total income determined by the AO was Rs. 13.99 Crores which included various disallowance and additions. After the assessment was framed, a notice was issued under Section-263 of the Income Tax Act by the Commissioner. This was in respect of disallowance as far as it concerns a dividend income of Rs. 6,93,69, 402/- [for which an exemption has been claimed under Section 10 (33)] received by the assessee. The dividend had been received from DLF Power Limited, a sister concern. After considering the submissions of the assesse, and the views of the Revenue, the Commissioner held as follows: -

(3.) The Commissioner, therefore, set aside the assessment on the question of disallowance of proportionate income pertaining to dividend and directed fresh adjudication in accordance with law. The Commissioner's order under Section-263 was challenged in an appeal to the ITAT which concluded after considering the order sheets and the materials placed on record that: -