section 263

Order dropping penalty proceedings u/s 271(1)(c) – Revision u/s 263 – A Case Study

Income Tax - Through this article an attempt has been made to explain the circumstances where the revisionary powers of the commissioners u/s 263 can be invoked when the order dropping penalty proceedings u/s 271(1)(c) of the I.T. Act, 1961 was passed by the Assessing Officer. In the case of M/s. DEF, an India Company, an order was […]...

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Does Revisionary power u/s 263 of Income Tax Act 1961 really confer power to re-review?

Income Tax - Section 263 confers wide powers on Principle Commissioner of Income Tax/Commissioner of Income Tax (Pr.CIT/CIT) to revise any assessment which is erroneous and prejudicial to interests of revenue....

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Section 263 Revision of orders prejudicial to revenue – Amendment wef 01.06.2015

Income Tax - Commissioner of Income Tax (CIT) has the power u/s 263 & 264 of the Income Tax Act, 1961, to consider an order passed by Assessing officer (AO). U/S 264, CIT can consider the order passed by AO, only when an appeal is made by assessee to him within stipulated time frame. However, u/s 263 CIT possesses the power to consider the order passe...

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Sec. 263 Order which are erroneous and prejudicial to interests of revenue

Income Tax - It is proposed to provide that an order passed by the Assessing Officer shall be deemed to be erroneous in so far as it is prejudicial to the interests of the revenue, if, in the opinion of the Principal Commissioner or Commissioner,— 1. the order is passed without making inquiries or verification which, should have been made; 2. ...

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No Reopening of Assessment to be made on Audit Objections: Committee Recommends

Income Tax - One of the key sources of dispute is the existing arrangement for follow up on audit objections by Internal Audit Party and the Revenue Audit Party. In terms of the existing arrangement, the Assessing Officer is required to take corrective steps following audit objections. The corrective measures take the form of rectification or reassess...

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Section 263 CIT cannot direct AO to decide issue afresh to make rowing enquiry

M/s Aadhar Rice Mills Pvt. Ltd. Vs ITO (ITAT Ranchi) - Pr. CIT has proceeded to revise the scrutiny assessment order and directing the AO to decide the issue afresh i.e. for making rowing enquiry which is not permissible u/s.263 of the Act....

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Revisionary jurisdiction cannot be exercised against Void order

Pioneer Distilleries Limited Vs Pr. CIT (ITAT Pune) - Pioneer Distilleries Limited Vs Pr. CIT (ITAT Pune) In the present set of facts where the Commissioner himself has given a finding that the re-assessment proceedings have not been correctly carried out against the assessee and the Assessing Officer has failed to fulfill his obligation, then under su...

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Fresh additions cannot be made in assessment due to revisional order u/s 263

M/s. Model Tanners (India) (P) Ltd. Vs. ACIT (ITAT Lucknow) - While framing of assessment in pursuance of revisional order passed under section 263, AO was entitled to consider only those items which had been considered by CIT and was not entitled to consider any other item afresh for making addition....

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Section 263 Revision invalid when assessment order merged with CIT(A)’s order

CIT (E) Vs Slum Rehabilitation Authority (Bombay High Court) - Revision under section 263 was invalid in case order of assessment merged with the order of Appellate CIT in its entirety as CIT did not have jurisdiction to revise such order of assessment in view of clause (c) of Expln. 1 to sub-section (1) of section 263....

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Reassessment without notice u/s 143(2) was bad in law & cannot be revised u/s 263

M/s. Supersonic Technologies Pvt. Ltd. Vs PCIT (ITAT Delhi) - Since no notice under section 143(2) had been issued for completion of the re-assessment proceedings, therefore, the re-assessment order itself was bad in law and the same could not be revised under section 263. ...

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CIT cannot exercise Revisionary power u/s 263 merely because he has different opinion on the matter

The assessee has filed this appeal disputing the order of Pr. Commissioner of Income Tax-15, Kolkata passed u/s 263 of the Income Tax Act, 1961 (hereinafter referred to as the Act) dated 22.03.2017 by which the Ld. Pr. CIT set aside the assessment order dated 02.03.2015 passed u/s 143(3) of the Act ...

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Recent Posts in "section 263"

Section 263 CIT cannot direct AO to decide issue afresh to make rowing enquiry

M/s Aadhar Rice Mills Pvt. Ltd. Vs ITO (ITAT Ranchi)

Pr. CIT has proceeded to revise the scrutiny assessment order and directing the AO to decide the issue afresh i.e. for making rowing enquiry which is not permissible u/s.263 of the Act....

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Revisionary jurisdiction cannot be exercised against Void order

Pioneer Distilleries Limited Vs Pr. CIT (ITAT Pune)

Pioneer Distilleries Limited Vs Pr. CIT (ITAT Pune) In the present set of facts where the Commissioner himself has given a finding that the re-assessment proceedings have not been correctly carried out against the assessee and the Assessing Officer has failed to fulfill his obligation, then under such circumstances where, he has also held...

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Fresh additions cannot be made in assessment due to revisional order u/s 263

M/s. Model Tanners (India) (P) Ltd. Vs. ACIT (ITAT Lucknow)

While framing of assessment in pursuance of revisional order passed under section 263, AO was entitled to consider only those items which had been considered by CIT and was not entitled to consider any other item afresh for making addition....

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Section 263 Revision invalid when assessment order merged with CIT(A)’s order

CIT (E) Vs Slum Rehabilitation Authority (Bombay High Court)

Revision under section 263 was invalid in case order of assessment merged with the order of Appellate CIT in its entirety as CIT did not have jurisdiction to revise such order of assessment in view of clause (c) of Expln. 1 to sub-section (1) of section 263....

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Reassessment without notice u/s 143(2) was bad in law & cannot be revised u/s 263

M/s. Supersonic Technologies Pvt. Ltd. Vs PCIT (ITAT Delhi)

Since no notice under section 143(2) had been issued for completion of the re-assessment proceedings, therefore, the re-assessment order itself was bad in law and the same could not be revised under section 263. ...

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Section 263 gets triggered only when order is erroneous & also prejudicial to interest of Revenue

M/s. Sarda Energy & Minerals Ltd. Vs. Pr. CIT (ITAT Raipur)

Held, That The Assessing Officer had conducted enquiry and after various rounds of hearing and deliberation with the assessee and scrutinizing the documents filed before him as well as submissions of the assessee, the Assessing Officer had passed an order. ...

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Revisionary power U/s. 263 cannot be exercised on ground not covered in Re-Opening

Gulab Badgujar (HUF) Vs CIT (Central) (ITAT Pune)

Gulab Badgujar (HUF) Vs CIT (Central) (ITAT Pune) The question which arises is the exercise of revisionary jurisdiction by the Commissioner of Income Tax under section 263 of the Act against the order passed under section 143(3) r.w.s. 147 of the Act, wherein the assessment proceedings were re-opened on specific reasons recorded for re-op...

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Claim of deduction accepted by AO despite unequivocal language of Act is erroneous U/s. 263

Paras Chinubhai Jani Vs Pr. CIT (ITAT Ahmedabad)

Claim of deduction accepted by the AO despite unequivocal language of the Act, in our view, is erroneous as contemplated under s. 263 of the Act. Such error on the part of the AO has caused definite prejudice to the interest of the Revenue. ...

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Revisional jurisdiction U/s./ 263 cannot be exercised for better view of CIT

The Principal Commissioner of Income Tax ­8 Vs M/s. Yes Bank Ltd. (Bombay High Court)

Pr. CIT Vs M/s. Yes Bank Ltd. (Bombay High Court) Assessing Officer sought clarification from the assessee about the correctness of the amount of one­fifth of the total expenses incurred under Section 35D of the Act. The assessee under letter dated 26.10.2004 gave specific explanation on the issue raised by the Assessing Officer and ther...

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Stock-in-trade transfers in the year in which sale deed gets executed

Shri Challa Ramakrishna Vs ACIT (ITAT Hyderabad)

ITAT held that Stock- in-trade can be considered as transferred only in the year in which the assessee has executed the sale deed transferring the stock-in-trade and not when the assessee has given stock-in-trade for joint development to the builder. As already held in the above cases, the provisions of section 2(47)(v) would apply only t...

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