Ravindra Purshottamdas Patel Vs PCIT-1 (ITAT, Rajkot Bench)
Revision Had a Deadline, Not an Afterlife: Failure to Pass Consequential Order u/s 153(3) Makes Section 263 Order Infructuous
PCIT Revises the Assessment
The assessee, proprietor of Krishna Financers, challenged the revisionary order dated 31.03.2024 passed by the PCIT-1, Rajkot, u/s 263.
The original assessment had been completed by the AO u/s 143(3) on 29.05.2021.
Invoking his revisionary jurisdiction, the PCIT directed the AO to revisit the assessment & pass a fresh assessment order after making necessary additions under the appropriate provisions of the Income-tax Act.
The PCIT further specifically directed that the consequential assessment order should be passed within the limitation period prescribed u/s 153(3).
Thus, the Section 263 order did not itself quantify or make the proposed additions. It required the AO to undertake a fresh examination & pass a consequential order within the statutorily permitted time.
AO Takes No Consequential Action
When the appeal came up before the Tribunal, the assessee’s counsel submitted that the AO had not passed any consequential assessment order pursuant to the PCIT’s directions.
According to the assessee, the prescribed limitation for giving effect to the revisionary order had expired. Since the Section 263 order was passed on 31.03.2024, the consequential assessment was required to be completed on or before 31.03.2025.
