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2022 (4) TMI 1588 - AT - Income TaxRevision u/s 263 - issue decided in favour of the assessee in preceding AY by the Tribunal, a superior Appellate Authority - as per CIT AO has erred in allowing assessee’s claim of deduction u/s 80IB(10) in respect of sale of FSI generated from its project at Mayanagar, Worli, Mumbai - HELD THAT:- No doubt while adjudicating appeal for AY 2013- 14, the Tribunal has referred to the Assessment Order for AY 2015-16 which is now subject of revision, nevertheless, the Co-ordinate Bench decided the issue in favour of assessee on merits and not solely by placing reliance on the assessment order for AY 2015-16. The reference to Assessment Order for AY 2015-16 is for giving impetus to the independent findings given in the order. Tribunal de-hors the assessment order for AY 2015-16 has come to the conclusion that the assessee is eligible to claim deduction u/s 80IA(10) on SRA project at Mayanagar, Worli approved under DC Regulation 33(10). Once, the issue has been decided in favour of the assessee in preceding AY by the Tribunal, it was incumbent upon the PCIT to follow the order of Tribunal, a superior Appellate Authority. PCIT in the impugned order does mention the fact about the order of Tribunal in assessee’s own case for AY 2013-14, but, decline to follow the same on the premise that the sole reason for allowing claim of deduction u/s. 80IB(10) of the Act was the assessment order for AY 2015-16. The reason given by PCIT to disregard the order of Tribunal for AY 2013-14 is misconceived, hence, unsustainable. It is evident from records that the AO in AY 2015-16 has taken a view that is supported by the decision of Tribunal. The assessment order cannot be held to be erroneous merely for the reason that it has resulted in loss of revenue. If only one of the twin condition is satisfied, the order passed by the assessing officer cannot be revised u/s. 263 of the Act. In the instant case, we find that the view taken by the assessing officer in allowing assessee’s claim of deduction under section 80IB(10) is one of the possible views backed by the order of Tribunal in assessee’s own case in respect of the same very project in the AY 2013-14. Therefore, the assessment order cannot be said to be erroneous. The impugned order is unsustainable and is liable to be quashed. Revisional jurisdiction is transaction of sale of FSI to FourZone Realtors Pvt. Ltd. - In the instant case, no material is available on record to suggest that on the fresh issue raised while passing the order under section 263 of the Act, the PCIT had granted opportunity of hearing to the assessee. Thus, without affording opportunity of hearing to the assessee on the fresh issue, the PCIT could not have taken up the issue in exercise of his revisional powers. Adjudicating fresh issue without affording opportunity of hearing to the assessee makes the order unsustainable and hence, liable to be quashed. Revisional powers invoked by the PCIT consequent to proposal of revision received from Addl. CIT - Section 263 mandates two preconditions to be complied before coming to the conclusion that the assessment order is erroneous and prejudicial to the interest of revenue. These two primary conditions are, (i) examination of records by the PCIT/CIT, and (ii) consideration by the PCIT/CIT of the order passed by assessing officer. Thus, it is the action of PCIT/CIT to examine records and consideration of order that opens the gate for exercising revisional powers u/s. 263 of the Act. From reading of above provisions of the section it is explicitly clear that the section does not give leverage to PCIT/CIT to exercise revisional jurisdiction on proposal received from any other authority under the Act. The key to unlock passage for exercising revisional powers is examination of records and consideration of assessment order by the PCIT/CIT. In the entire impugned order the PCIT has nowhere mentioned that the revisional powers u/s. 263 have been exercised upon his examination of records and consideration of the order passed by the Assessing Officer. The PCIT has initiated revisional proceedings consequent to proposal received from Addl. CIT- Range Head, hence, the mandatory requirement of section 263 of the Act in the present case is not satisfied. In facts of the case, we are of considered view that the impugned order suffers from legal infirmity. Thus we hold the impugned order untenable, hence, the same is quashed.
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