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Facts
The assessee's original assessment for AY 2017-18 was completed u/s 143(3). The PCIT first revised this order u/s 263 due to alleged non-deduction of TDS on carriage inward expenses. After the AO passed a fresh order accepting the income, the PCIT again initiated revision proceedings, this time to disallow cash payments for freight expenses in contravention of Section 40A(3), which the assessee argued was time-barred.
Held
The Tribunal held that the PCIT's second revisionary order dated 27.12.2024 was invalid and time-barred. It noted the second revision was on a new ground (Section 40A(3)) not part of the first revision and that the original assessment, if to be revised on this new ground, would be barred by limitation under Section 263(2). Thus, the PCIT's order was quashed.
Key Issues
Whether the PCIT's second revisionary order, passed beyond the limitation period prescribed for the original assessment and based on a new ground not previously challenged, was valid under Section 263 of the Income-tax Act.
Sections Cited
263, 263(1), 263(2), 143(3), 142(1), 194C, 194C(6), 40A(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH, KOLKATA
This is an appeal preferred by the assessee against the order of the Pr. Commissioner of Income Tax, Kolkata-1 (hereinafter referred to as the “Ld. PCIT”] dated 27.12.2024 for the AY 2017-18.
The issue raised in ground no.1 is a legal issue and is against the invalid exercise of jurisdiction u/s 263 of the Income-tax Act, 1961 (the Act) by the ld. Pr. Commissioner of Income Tax (in short ‘the ld. PCIT’), which is invalid and is barred by limitation in terms of Provisions of Section 263(2) of the Act also.
The facts in brief are that the return of income was filed on 24.10.2017, declaring a total income of ₹10,10,590/-, which was
The ld. DR on the other hand relied on the order of PCIT by submitting that the ld. PCIT has revised the assessment framed on 06.03.2023 passed u/s 143 read with section 263 of the Act and therefore, is not barred by limitation.
In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 13.05.2025.