1. Introduction
As already discussed in detail in the previous article, section 263 of the Income-tax Act, 1961 and section 377 of the Income-tax Act, 2025 generally deal with revisional proceedings that are ordinarily prejudicial to the interests of the assessee, as they empower the higher authority to intervene from the Revenue’s perspective.
In contrast, section 264 of the Income-tax Act, 1961 and section 378 of the Income-tax Act, 2025 occupy the same functional field. Both provisions deal with the revision of other orders and operate as beneficial revisional remedies available to the assessee, subject to the prescribed statutory limitations, appellate restrictions, time limits, and procedural conditions. On the other hand, section 263 of the 1961 Act and section 377 of the 2025 Act represent the Revenue-centric revisional jurisdiction.
Therefore, for a complete and systematic understanding of the assessee-oriented revisional framework, section 264 of the 1961 Act and section 378 of the 2025 Act must be read together.
In this article, we will discuss section 378 of the Income-tax Act, 2025 in detail, as the corresponding beneficial revision provision to section 264 of the 1961 Act. The discussion will cover when an application may be made, how it should be made, and how the assessee may derive benefit under the provision. The article will also provide a detailed comparison between sections 377 and 378, since there is considerable confusion in practice regarding the scope and applicability of these two provisions and the circumstances in which each section operates.
If, even after reading the article, you have any further doubts or require clarification, you may contact me at the details mentioned at the end of the article.
2. Statutory Position and Transition from Old Act to New Act
Under the Income-tax Act, 1961, the beneficial revisional provision is section 264. Under the Income-tax Act, 2025, the corresponding provision is section 378. The new Act came into force from 1 April 2026.
However, an important transition rule governs the applicability of these provisions. For tax years beginning before 1 April 2026, proceedings ordinarily continue under the 1961 Act. Further, revision applications already filed under section 264 and pending as on 01.04.2026 continue to be governed and disposed of under the 1961 Act. Thus, even after commencement of the new Act, section 264 remains relevant for a large body of pending and earlier-year matters.
Accordingly, the practical position is as follows:
- For tax years governed by the 1961 Act → the relevant revisional provision is section 264.
• For tax years governed by the 2025 Act → the corresponding revisional provision is section 378.
Thus, section 378 may safely be described as the successor / corresponding provision to section 264.
3. Nature and Object of Sections 264 and 378
Both provisions are titled “Revision of other orders.” The phrase itself is significant. It shows that these provisions are intended to cover those revisional situations which do not fall within the Revenue-protective field of section 263 / section 377.
Under section 264(1), the Principal Commissioner or Commissioner may revise any order passed by an authority subordinate to him, either suo motu or on an application by the assessee. Similarly, under section 378(1), the Competent Authority may revise any order passed by an authority subordinate to it, either suo motu or on an application by the assessee, provided the order is not one to which section 377 applies.
The most important common feature is this: the revisional order cannot be prejudicial to the assessee. This is the defining character of both provisions. These sections are therefore not punitive or revenue-enhancing in nature. They are designed as supervisory and corrective remedies, mainly to grant relief where the assessee has suffered overassessment, wrong taxation, denial of lawful claim, computational error, or similar prejudice.
Thus, in substance, sections 264 and 378 are assessee-relief revision provisions.
4. Relationship with Sections 263 and 377
To understand sections 264 and 378 properly, one must contrast them with the Revenue-side revision powers.
Section 263 / Section 377
These provisions are intended to deal with orders that are erroneous insofar as they are prejudicial to the interests of the Revenue. They are Revenue-protection provisions.
Section 264 / Section 378
These provisions deal with other orders, i.e. those not falling in the Revenue-prejudicial revision field. They are intended to provide relief in cases where the matter is not one of Revenue enhancement, and where the revisional authority’s order cannot worsen the assessee’s position.
Thus, the accepted functional mapping is:
- Section 263, Income-tax Act, 1961 ≈ Section 377, Income-tax Act, 2025
- Section 264, Income-tax Act, 1961 ≈ Section 378, Income-tax Act, 2025
5. Who Can Invoke These Provisions
A major common feature of sections 264 and 378 is that the revisional jurisdiction can begin in two ways:
First, the revisional authority may act suo motu.
Second, the assessee may apply for revision.
This is a very important structural aspect. It means that these provisions are not merely internal departmental supervisory powers. They are also taxpayer-usable remedies.
Under section 264, the authority is the Principal Commissioner / Commissioner. Under section 378, the expression used is “Competent Authority,” which includes the Principal Chief Commissioner / Chief Commissioner / Principal Commissioner / Commissioner. In either case, the petition does not lie before the Assessing Officer; it lies before the higher supervisory authority.
6. Scope of Orders Covered
The wording of both provisions is deliberately broad.
Under section 264, the revisional power extends to any order other than an order to which section 263 applies, provided the order is passed by a subordinate authority.
Under section 378, the revisional power extends to any order, other than an order to which section 377 applies, passed by a subordinate authority.
Therefore, both provisions are residuary in the revisional sense. They occupy the field left outside the Revenue-centric revision provisions.
This breadth is one reason why these provisions are so useful in practice. They are not limited only to regular assessment orders. Depending on the facts, they may be invoked in respect of many kinds of orders, subject of course to statutory maintainability conditions and appellate bars.
7. Core Safeguard: Order Cannot Be Prejudicial to the Assessee
This is the single most important practical advantage of both sections 264 and 378.
The revisional authority may call for the record, make or cause inquiry, and pass such order as it thinks fit, but the order cannot be prejudicial to the assessee. Thus, unlike the Revenue’s revision powers, these provisions do not allow enhancement or deterioration of the assessee’s position.
This makes sections 264 and 378 particularly valuable where the assessee wants a corrective remedy without risking a worse order.
At the same time, one must note an equally important qualification: a mere order declining to interfere is not treated as an order prejudicial to the assessee. Therefore, although the authority cannot worsen the assessee’s position, it may still reject the revision application.
8. Time Limits and Limitation
Under Section 264
If the assessee applies for revision, the application must ordinarily be filed within one year from the date on which the order was communicated to him, or from the date on which he otherwise came to know of it, whichever is earlier.
Under Section 378
The same broad structure continues. The assessee’s application must ordinarily be made within one year from the date of communication of the order, or the date on which he otherwise came to know of it, whichever is earlier.
Condonation of Delay
In both provisions, delay may be condoned if the revisional authority is satisfied that the assessee was prevented by sufficient cause from making the application within time.
Suo Motu Revision
Under section 378, if the authority acts on its own motion, it cannot revise an order if it was made more than one year earlier. The old section 264 framework is also structured around defined limitation control.
Thus, both provisions are subject to limitation, but they are not rigidly inflexible because delay can be condoned on sufficient cause.
9. Appeal Bar and Waiver of Appeal
This is one of the most important practical filters in both provisions.
Sections 264 and 378 are not meant to run parallel to an active appellate remedy. Broadly, revision is barred:
- where the order is already under appeal;
- where the appeal route is still alive and the statutory conditions for revision are not satisfied;
- where appeal lies and the assessee has not waived the right of appeal, where such waiver is required by the section.
Under section 378 specifically, revision is not available where:
1. an appeal lies, but no appeal has been filed and the appeal time has not expired;
2. an appeal lies, but the assessee has not waived the right of appeal;
3. the order has already been made the subject matter of appeal before JCIT(A), CIT(A), or ITAT.
The same policy is embedded in section 264 as well. Therefore, revision under section 264 / 378 is best understood as a substitute corrective route in appropriate cases, not as a concurrent or parallel track to appeal.
10. Fee and Time for Disposal
Both section 264 and section 378 require that an assessee’s revision application be accompanied by a fee of ₹500.
On an application by the assessee, the revisional authority is generally required to dispose of the application within one year from the end of the financial year in which the application is made, subject to statutory exclusions.
The law also excludes certain periods, such as:
- time taken in rehearing in specified situations;
- period during which proceedings are stayed by a court.
Further, the provisions contain a minimum residual 60-day rule, so that the excluded period does not render the limitation mechanism unworkable.
Also important is the power to pass a revision order at any time where it is required to give effect to a finding or direction of the ITAT, High Court, or Supreme Court.
11. How to Apply: Practical Filing Framework
Although the exact portal interface may change from time to time, the Department treats these matters under the e-filing service framework of “Appeals and Revisions.” During the transition period, the portal is intended to support compliance under both the old and new Acts.
As a matter of prudent drafting and filing practice, a revision petition under section 264 or section 378 should contain the following:
- particulars of the impugned order;
- exact date of communication / date of knowledge;
- statement regarding maintainability under the relevant section;
- statement that the matter is not already under appeal;
- where appeal lies but is not being pursued, an express waiver of appellate remedy / right of appeal, wherever relevant;
- concise statement of facts;
- legal grounds for revision;
- exact relief sought;
- revised computation / refund working, where applicable;
- supporting documents and evidence;
- condonation petition, where filed beyond limitation;
- proof of payment of the ₹500 fee.
In section 378 matters, it is additionally prudent to clearly state that the case is governed by the Income-tax Act, 2025, and that the impugned order is not one covered by section 377.
12. In Which Cases These Provisions Are Beneficial for the Assessee
(A) Where the assessee seeks relief or refund without risk of enhancement
This is the biggest practical advantage. Since the revisional order cannot be prejudicial to the assessee, the remedy is often safer than entering a wider adversarial contest, especially when the grievance is narrow and corrective.
(B) Where the assessee himself has made a mistake
Judicial guidance under section 264 shows that the revisional power is wide and is not confined only to errors committed by the Department. It may also extend to errors committed by the assessee.
In InterGlobe Enterprises Pvt. Ltd. v. Pr. Commissioner of Income Tax, Delhi-4 [2023/DHC/000618], the Delhi High Court observed that the powers under section 264 are wide. The reasoning supports the view that lawful relief cannot be denied merely because the original error was committed by the assessee himself.
Similarly, Pramod R. Agrawal v. PCIT-5 [2023:BHC-OS:12261-DB] treats section 264 as a beneficial provision meant to meet the situation of an aggrieved assessee who is unable to obtain relief otherwise.
Accordingly, revision is especially useful where:
- a deduction / exemption / rebate was omitted by mistake;
- a computational error caused excess tax;
- excess income was offered by mistake;
- a lawful refund was missed;
- the revised return route is no longer available;
- the issue is clear and document-based.
(C) Where the issue arises from an intimation under section 143(1)
This is one of the most practical applications of section 264, and by analogy the same logic is relevant for section 378.
In Shangri-La International Hotel Management Pte. Ltd., W.P.(C) 17353/2025, decision dated 14.11.2025, the Delhi High Court dealt with a section 264 revision against an intimation / order under section 143(1) and accepted the maintainability position noted in the case materials. The Court also referred to Vijay Gupta v. CIT and EPCOS Electronic Components S.A. v. Union of India.
Thus, where a return is merely processed under section 143(1), and a lawful claim or refund issue remains unresolved, revision may be a very useful remedy.
(D) Where section 154 is too narrow
Section 154 is confined to a mistake apparent from the record. Many genuine cases of assessee relief fail under section 154 because the Department treats the issue as debatable or requiring examination.
Revision under section 264 / 378 is broader because the revisional authority may call for the record and make or cause inquiry. Hence, these provisions are often more suitable than section 154 where:
- some explanation is required;
- the issue is not purely mechanical;
- additional supporting material needs to be considered;
- the claim is legally due, though not apparent in a narrow rectification sense.
(E) Where the assessee suffers double taxation or overassessment
InterGlobe Enterprises is also a strong illustration of the use of revision to correct cases of wrongful or duplicate taxation.
Therefore, revision is beneficial where:
- the same income is taxed in two years;
- income is taxed in the wrong year;
- income is taxed under the wrong head;
- overassessment is evident from the record and supporting documents;
- refund relief is otherwise due.
(F) Where the assessee wants a narrow, document-based correction instead of a full appeal
These provisions are best suited for relief-focused, limited, documentary issues, not wide-ranging litigation contests.
13. In Which Cases Section 264 / 378 Is Usually Not the Best Remedy
Revision is generally not ideal where the assessee needs a full appellate challenge on multiple legal and factual grounds.
Examples include:
- complex jurisdictional objections;
- detailed natural justice challenges;
- evidence-heavy disputes requiring full fact adjudication;
- comprehensive challenge to the assessment order as a whole;
- major additions requiring detailed appellate consideration;
- cases where the appellate route is strategically preferable and the assessee does not wish to waive it.
In such matters, the proper appellate remedy is usually stronger and more appropriate.
Thus, one may broadly say:
- Prefer appeal where the challenge is wide, contested, fact-heavy, or jurisdictional.
- Prefer section 264 / 378 where the matter is narrow, corrective, refund-oriented, and document-supported.
14. Difference Between Section 264 / 378 and Section 263 / 377
The distinction may be stated in topic-wise form:
(i) Basic Purpose
- 263 / 377: Revenue-protection revision.
- 264 / 378: Assessee-relief revision.
(ii) Interest Protected
- 263 / 377: Protects Revenue.
- 264 / 378: Protects assessee against prejudicial revision.
(iii) Nature of Orders Covered
- 263 / 377: Orders which are erroneous and prejudicial to the interests of the Revenue.
• 264 / 378: Other orders outside that Revenue-prejudicial field.
(iv) Jurisdictional Trigger
- 263 / 377: Twin condition of error + prejudice to Revenue.
- 264 / 378: No such twin-condition test; key restriction is that the revisional result must not be prejudicial to the assessee.
(v) Who Can Set the Process in Motion
- 263 / 377: Essentially departmental revisional power.
- 264 / 378: Can be invoked by the assessee through an application, apart from suo motu exercise.
(vi) Interaction with Appeal
- 263 / 377: Can sometimes survive partially even where appeal exists, in respect of issues not considered and decided.
- 264 / 378: Barred where appeal is live, not waived, or already filed.
(vii) Limitation Structure
- 263 / 377: Broader Revenue-side limitation framework.
- 264 / 378: One-year application period for assessee, with condonation and disposal framework.
In short, section 264 / 378 is a beneficial supervisory remedy, whereas section 263 / 377 is a Revenue correction and enhancement mechanism.
15. Special Importance of Section 378
Although section 378 is structurally parallel to section 264, it carries special importance because it marks the continuation of the beneficial revisional model under the new law.
Its significance lies in the following:
- it preserves an assessee-facing revisional jurisdiction under the 2025 Act;
- it keeps alive the distinction between Revenue revision and assessee relief revision;
- it ensures that even under the new enactment, the assessee has a supervisory corrective remedy outside the appellate route;
- until substantial jurisprudence under section 378 develops, the principles emerging from section 264 jurisprudence will remain highly persuasive for understanding its practical scope.
Thus, section 378 should be seen not as a completely new concept, but as the new Act version of the old beneficial revision model.
16. Practical Test for Choosing Section 264 / 378
A revision petition under section 264 or section 378 is usually a good fit where most of the following conditions are present:
- the assessee wants relief / refund / correction, not a full adversarial challenge;
- the issue is clear, legal, and document-supported;
- the order is not already under appeal;
- limitation is still available, or delay can be properly explained;
- the appellate route is either unavailable, expired, or consciously waived where necessary;
- the assessee wants a remedy where the authority cannot worsen his position;
- the matter involves an omitted lawful claim, wrong year taxation, double taxation, excess computation, or 143(1)-type injustice;
- the issue requires something broader than section 154, but not as wide as a full appeal.
17. Conclusion
Sections 264 of the Income-tax Act, 1961 and 378 of the Income-tax Act, 2025 are, in substance and design, the same category of beneficial revisional remedy. Both deal with “Revision of other orders”; both are meant to operate outside the Revenue-prejudicial field of section 263 / 377; both can be invoked by the assessee; both are subject to limitation, condonation, fee, appeal-bar, and waiver conditions; and both contain the crucial safeguard that the revisional order cannot be prejudicial to the assessee.
For this reason, section 264 and section 378 must be understood together. Section 264 governs the old Act field; section 378 governs the new Act field. But conceptually, both represent the same legislative policy: to provide the assessee a supervisory revisional remedy for correction, refund, and lawful relief without the risk of enhancement.
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