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2022 (3) TMI 524 - ITAT MUMBAIRevision u/s 263 by CIT - assessment was sought to be reopened by the ld. AO u/s. 147 on the ground that assessee had not offered profit earned to tax on surrender of purchase of pension policy from Bajaj Alliance Insurance Company - HELD THAT:- The issue which is sought to be revised by the ld. PCIT in Section 263 proceedings was already considered and decided by the ld. CIT(A) in the hands of the assessee for A.Y. 2011-12. As per the provisions of Clause (c) of Explanation to Section 263(1) of the Act, the matter which has already been considered and decided by the ld. CIT(A) cannot be the subject matter of revision by the ld. PCIT u/s. 263 of the Act. Even though no addition was made by the ld. AO in Section 147 assessment dated 12/12/2018 in line with order of ld. CIT(A), still in our considered opinion, there would be no prejudice that would be caused to the Revenue as the additional disallowance contemplated by the ld. CIT(A) u/s. 14A of the Act would be made in either case by the ld. AO in the order giving effect proceedings to the ld. CIT(A). Hence, there is absolutely no prejudice that would be caused to the interest of the Revenue. Hence, one of the pre-requisite of invoking Section 263 of the Act fails. PCIT herein is only seeking to revise the order passed by the ld. AO u/s. 143(3) r.w.s. 147 of the Act dated 12/12/2018. In the said re-assessment proceedings, the ld. AO had not even made any addition despite the fact that he had reason to believe that income of ₹ 11,55,330/- had escaped assessment in the hands of the assessee which was sought to be taxed u/s. 56 of the Act as per the reasons recorded. Hence, when the very basis of reasons recorded by the ld. AO was ultimately not added by the ld. AO in the re-assessment proceedings, then the primary reason to believe that income of the assessee had escaped assessment fails and such re-assessment cannot be treated as a valid order in the eyes of law. The same is to be declared as void ab initio. Reliance in this regard was rightly placed on the decision of Jet Airways [2010 (4) TMI 431 - HIGH COURT OF BOMBAY] When an assessment framed by the ld. AO is unsustainable in the eyes of law, the said invalid and illegal order cannot be subject matter of section 263 proceedings. On this count also, the revision order passed by the ld. PCIT u/s. 263 of the Act deserves to be quashed. - Decided in favour of assessee.
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