PCIT Vs Anjaniputra Nirmal Pvt. Ltd. (Calcutta High Court)
The Calcutta High Court dismissed an appeal filed by the revenue department, affirming that a revisionary order under Section 263 of the Income Tax Act, 1961, cannot be passed if the Assessing Officer has already conducted an inquiry into the matter. The case, PCIT vs Anjaniputra Nirmal Pvt. Ltd., centered on the Principal Commissioner of Income Tax’s (PCIT) attempt to set aside a fresh assessment order that had been passed by an Assessing Officer (AO). This was the second time the PCIT had invoked its power under Section 263. In the first instance, the PCIT set aside the original assessment and directed the AO to re-frame it.
Upon the reassessment, the AO conducted a detailed inquiry, collecting evidence and documents from the assessee and the share subscribers under Section 133(6). Based on this, the AO deleted an earlier addition made under Section 68 concerning share capital and share premium. The PCIT, however, deemed this new assessment order as “erroneous and prejudicial to the interest of the revenue,” arguing that the AO’s investigation was “deficient” and lacked “detailed investigation/verification/independent enquiry.” As a result, the PCIT issued another Section 263 notice, aiming to set aside the fresh assessment.
