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2021 (11) TMI 808 - AT - Income TaxRevision u/s 263 by CIT-A - essential prerequisite for assuming revisionary jurisdiction u/s 263 - AO having not inquired into the difference in the amount of sales, trade receivables and trade payments as reflected in the financial statements of the assessee and that submitted in the details to the AO, causing prejudice to the Revenue on account of income relating to sales to that extent having escaped assessment or there being unexplained investments of the assessee - HELD THAT:- It is a settled proposition of law that for assuming revisionary jurisdiction u/s 263 of the Act there has to be a clear finding of error by the PCIT/CIT in the order so sought to be revised. And this finding has to be arrived at after conducting necessary inquiry if required. In cases of inadequate inquiry there has to be a finding that the inquiry made was erroneous. And this can happen only when the PCIT/CIT himself conducts an inquiry and verification and establishes therefrom the error made by the AO, making his order unsustainable in law. The finding must be clear, unambiguous and not debatable. The matter cannot be remitted for a fresh decision to the AO to conduct further inquiries without a finding that the order is erroneous. Where the assessee we find had duly furnished an explanation of the issue not allegedly found to have been examined by the AO and the Ld.Pr.CIT having not even made an effort of examining the explanation simply restoring it to the AO to do so, there is we hold no finding of error by the Ld.PCIT in the order of the AO. We hold that the orders passed by the ld. Pr. CIT being beyond the scope of section 263 of the Act are not valid. Accordingly we set aside the revision orders passed by the Ld.PCIT for the two years under consideration. - Decided in favour of assessee.
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