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Facts
The revenue appealed against the CIT(A)'s order for AY 2016-17, which quashed consequential assessment proceedings initiated under sections 144 read with 263 of the Income-tax Act. These consequential proceedings followed a revision order passed by the PCIT under section 263, which was subsequently quashed by the Tribunal.
Held
The Tribunal affirmed the CIT(A)'s decision, holding that consequential proceedings cannot survive once the foundational original revision order under section 263, upon which they were based, has been quashed by the Tribunal. Therefore, the CIT(A) correctly quashed the consequential proceedings.
Key Issues
Whether consequential assessment proceedings can legally continue when the primary revision order under section 263, which led to them, has been set aside by the Tribunal.
Sections Cited
144, 263
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Income Tax Appellate Tribunal, DELHI BENCH “A”: NEW DELHI
Before: SHRI M. BALAGANESH & SHRI ANUBHAV SHARMA
O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in AY 2016-17, arises out of the order of the Commissioner of Income Tax (Appeals)-3, Gurgaon [hereinafter referred to as ‘ld. CIT(A)’, in short] in Appeal No. 11409/2015-16 dated 27.07.2023 against the order of assessment passed u/s 144 read with section 263 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 27.03.2022 by the Assessing Officer, DCIT, Central Circle, Karnal (hereinafter referred to as ‘ld. AO’).
On perusal of the ground of appeal filed by the revenue, it is very clear that the order passed by the ld PCIT u/s 263 of the Act stood quashed by this Tribunal. The present proceeding is consequential proceeding u/s 263 of the Act. When the original proceedings i.e. revision order u/s 263 of the Act , stood quashed by the Tribunal, the consequential proceeding would not survive in the eyes of the law. Hence, there is no infirmity in the order of the ld CIT(A) in quashing the consequential proceedings. Accordingly, the grounds raised by the revenue are dismissed.
In the result, the appeal of the revenue is dismissed.
Order pronounced in the open court on 07/03/2024.