M/s. Premier Solar Power Tech Private Limited v. Principal Commissioner of Income Tax, Hyderabad-4 and others

1. FACTS OF THE CASE

Premier Solar claimed liquidated damages for an NLC solar-project contract in AY 2020-21. A subsequent reversal offered to tax in AY 2021-22 included Rs.6,85,02,377, which was later disallowed in the earlier year and taxed there too. Having accepted and paid that disallowance, the company sought reduction of the same amount from AY 2021-22 through section 264. The Commissioner rejected its application on 27 March 2026.

Source: PDF paras 3–9, pp.4–8

2. DISCUSSION BY THE COURT

The Court held that section 264 extends to an assessee’s own errors and is not defeated merely by absence of a timely revised return. It rejected the distinction between disallowance and voluntary reversal where the same sum was taxed twice. The combined effect of the two orders, rather than the intimation viewed alone, disclosed over-assessment. Section 264 serves an assessee-protective purpose distinct from section 263.

Source: PDF paras 17–29, pp.25–34

3. JUDICIAL DECISION

The 27 March 2026 revisional order was set aside. The 3 April 2024 section 264 application was remanded to the Commissioner for fresh consideration on merits, in accordance with law and the Court’s observations.

Source: PDF para 30, pp.34–35

4. OUTCOME

The writ petition was allowed, miscellaneous petitions closed and no costs awarded. The operative order grants reconsideration; it does not itself quantify a refund, award interest or fix a disposal deadline.

Source: PDF paras 30–32, p.35

5. Expert Comments

AKHB editorial analysis, distinct from the Court’s findings.

Prove identity of the amount

The result depended on tracing Rs.6,85,02,377 through the provision, later reversal and earlier-year disallowance. A year-wise reconciliation of books, returns, orders and tax payment makes the duplication demonstrable; merely showing two tax years or similar accounting labels would not establish the same factual premise.

Source: PDF paras4–8 and23–24, pp.5–8,28–30

Choose the correct revisional framework

The Court rejected importing Revenue-protective section 263 reasoning into section 264. Acceptance of returned income did not preclude correction of the resulting over-assessment. The missing revised return was not decisive, but this judgment does not abolish the statutory limits governing revision applications.

Source: PDF paras17–22 and27–28, pp.25–28,31–34

Separate the claim from other rectification

The section 154 order removed another adjustment and reduced the demand to nil, yet left the disputed reversal in taxable income. Nil demand therefore did not answer the double-taxation grievance. The record must distinguish correction of that adjustment from relief sought for the duplicated amount.

Source: PDF paras6–8, pp.6–8

Read relief from the operative paragraph

Strong findings on double taxation guide the Commissioner on remand. They are not a direct refund direction. Time limits and interest directions quoted from other cases in the judgment must not be imported into this order.

Source: PDF paras30–32, pp.34–35