Case Law Details
Saif Partners India IV Limited Vs CIT (ITAT Delhi)
ITAT Delhi held that revisional power under section 263 of the Income Tax Act not invocable in case of ‘inadequate inquiry’, in fact, revisional power is invocable only in case of ‘lack of inquiry’.
Facts- This appeal by the assessee is preferred against the order dated 27.03.2022 framed u/s 263 of the Income-tax Act, 1961 by the CIT, International Taxation, Delhi -3 pertaining to Assessment Year 2017-18.
The sum and substance of the grievance of the assessee is that the ld. CIT(A) erred in assuming jurisdiction u/s 263 of the Act and further erred in holding that the order dated 09.12.2019 framed u/s 143(3) of the Act is erroneous and prejudicial to the interest of the Revenue.
Conclusion- It is a settled position of law that powers u/s 263 of the Act can be exercised by the Commissioner on satisfaction of twin conditions, i.e., the assessment order should be erroneous and prejudicial to the interest of the Revenue. By ‘erroneous’ is meant contrary to law. Thus, this power cannot be exercised unless the Commissioner is able to establish that the order of the Assessing Officer is erroneous and prejudicial to the interest of the Revenue. Thus, where there are two possible views and the Assessing Officer has taken one of the possible views, no action to exercise powers of revision can arise, nor can revisional power be exercised for directing a fuller enquiry to find out if the view taken is erroneous. This power of revision can be exercised only where no enquiry, as required under the law, is done. It is not open to enquire in case of inadequate inquiry.
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