INCOME TAX ACT, 1961

Section 263

Revision under section 263 - Erroneous and prejudicial order - No lack of enquiry by AO - Invocation of jurisdiction on the ground of no property enquiry done by AO

Pr.CIT held assessment order as eroneous and prejudicial to the interest of revenue on the ground of AO having made no proper enquiry as regards assessee's claim of exemption under section 10(38) on account of long-term capital gain. On sale of shares. Held: Pr. CIT cannot pass order under section 263 on the ground that thorough enquiry should have been made by AO. In the instant case, AO had given a specific notice regarding disputed transactions and assessee also gave specific reply to show-cause notice issued by AO. Therefore, it was not a case where AO had not made any enquiry regarding impugned transactions but the Pr. CIT invoked provisions of section 263 on the ground that enquiry was not made in the manner, it ought to have been done. Pr. CIT passed impugned revision orders only to carry out fishing and roving enquiries with objective of substituting his views with that of AO and this was not sustainable in law.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2015-16

SUBSCRIBE FOR FULL CONTENT