Assessee is a deemed Municipality working in name and style as ‘Sachin Notified Area’. Assessee had filed its return of income for  and claimed deduction under section 10(20). Assessing Officer had disallowed deduction claimed by assessee, stating that assessee was not covered by definition of Local Authority as contained in Explanation to section 10(20). Assessee filed appeal against said order before Commissioner (Appeals). During pendency of  appeal PCIT, revised the order on the ground that   the  assessee had received an amount towards interest on FD which was not routed through Profit & Loss account and same was directly shown in balance sheet as Capital Fund, under head Reserve and Surplus  therefore, he held that AO had not inquired into issue of income earned from interest on FDs and passed assessment order without application of his mind and thus, assessment order was erroneous insofar as it was prejudicial to interest of revenue. On appeal the Tribunal held that  interest income on fixed deposit could not be changed whether it was routed through profit and loss account or taken directly to reserve and surplus in balance sheet and hence there was neither violation of accounting principles, nor avoidance of tax on part of assessee under consideration. Since issue of interest on fixed deposit which was assessable under head ‘income from other sources’, had been examined by Assessing Officer during assessment stage by conducting necessary enquiry, order of AO sought to be revised in impugned order is  neither erroneous nor prejudicial to interest of revenue for reason of any lack of inquiry. Tribunal condoned the delay of 208 days in filing an appeal before the Tribunal.  (AY. 2017-18)