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2023 (8) TMI 78 - AT - Income TaxRevision u/s 263 by CIT - no or inadequate enquiry - assessee had revised its return of income for claiming Employee Stock Compensation Expenses (ESOP expenses) which was not claimed in the original return of income - Principal CIT held that the assessee had claimed expenses which were not included in the current year’s expenses and booked in the books of accounts through profit and loss account and AO ought to have verified/investigated the issue and ought to have disallowed the same - HELD THAT:- As from the records we observe that during the course of assessment, the AO called for details with respect to the claim of ESOP expenses and the assessee filed various replies to the queries raised by the assessing officer, during the course of assessment proceedings. We observe that this is not a case where there was an omission on part of the AO to examine this aspect of ESOP expenses at all. AO had put a specific queries before the assessee during the course of assessment by way of issuance of various notices and had taken assessee’s replies on record. As in the instant facts, there is no specific finding that the aforesaid expenses are not genuine or that there was any irregularity with respect to the aforesaid claim of ESOP expenses. So, in our view, this is not a case where no enquiry has been made by the assessee officer during the course of assessment proceedings. As held by various Courts, Principal CIT cannot in 263 proceedings set aside an assessment order merely because he has a different opinion in the matter. Sec 263 of the Act does not visualise a case of substitution of the judgment of the Principal CIT for that of the AO, who passed the order unless the decision is held to be wholly erroneous. Principal CIT, on perusal of the records, may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the Commissioner he would have estimated the income at a figure higher than the one determined by the Income-tax Officer. That would not vest the Commissioner with power to re-visit the entire assessment and determine the income himself at a higher figure. We thus find no error in the order of Ld. AO so as to justify initiation of 263 proceedings in the instant case. The Grounds of appeal raised by the assessee are thus allowed.
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