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2014 (4) TMI 528 - AT - Income TaxValidity of Revision u/s 263 of the Act – Explanation for debit and credit entries – Held that:- The AO himself can find his order as erroneous and prejudicial to the interest of the Revenue and can make such proposal to the CIT u/s the Act - The power of revision vests in Commissioner who may call and examine the record of any proceeding under the Act and if he considers that any order passed by the AO is erroneous and prejudicial to the interest of the Revenue - He may after giving the assessee an particular opportunity of being heard or after making any such enquiry revise that order - the AO has to examine the record himself to come to a conclusion that the order is erroneous and prejudicial to the interest of the Revenue - There is no such procedure laid under the Section wherein the AO himself can propose the order to file u/s 263 of the Act - the action of the AO is unwarranted and not legal - On the basis of such proposal, the CIT cannot take action as he has taken in this regard –Relying upon Rajeev Arora vs. CIT [2010 (7) TMI 641 - ITAT JAIPUR] -the AO cannot propose his own order by treating it as erroneous and prejudicial to the interest of Revenue for getting it revised by the Commissioner u/s 263 of the Act. The assessee has clearly explained the debit and credit entries as discussed in the written submission and also explained the cost of improvement shown by the assessee and the status of the land etc. - this is not a case of no verification or no proper verification - The verification done by the AO is also to be treated as proper unless some specific instruction or prescription of a particular section of the Act has not been carried out by the AO or else the AO has not conducted enquiry as demanded by law - The twin conditions of Section 263 are not found to co-exist – thus, the order of the CIT(A) set aside – Decided in favour of Assessee.
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