‘Detailed Enquiry and Proper Application of Mind by AO While Allowing Deduction u/s 80P(2)(d)’: ITAT Quashes PCIT’s Revision Order

The Income Tax Appellate Tribunal (ITAT) has quashed a PCIT's (Principal Commissioner of Income Tax) revision order, upholding that the Assessing Officer (AO) had conducted a detailed inquiry and proper application of mind while allowing a deduction. This ruling limits the revisional powers of higher tax authorities. The ITAT found that the AO's original assessment was not erroneous or prejudicial to the revenue, as it was based on thorough examination. This decision provides significant relief to taxpayers, ensuring that a higher authority cannot arbitrarily overturn an assessment without demonstrating a clear defect in the AO's process.