Landmark Cases on Revision under Section 263
214 decisions, ranked by how many judgments on BharatTax rely on them.
The Principal Commissioner of Income Tax is not justified in revising an Assessing Officer's order if the assessment was made after considering all facts and was not erroneous or prejudicial to the revenue.
The Commissioner may revise an Assessing Officer's order under Section 263 if the officer failed to conduct a necessary inquiry, making the order erroneous and prejudicial to revenue. The assessee must be given an opportunity to be heard and further inquiries may be conducted.
The Commissioner can only act under Section 263 on his own motion, not at the instance of the Assessing Officer. If reassessment under Section 147 is possible, Section 263 may not apply to escaped income where no order was passed by the Assessing Officer.
An assessment order is amenable to revision under Section 263 if the Assessing Officer fails to conduct necessary verification or summarily accepts the assessee's explanation, rendering the order erroneous and prejudicial to the revenue.
A Commissioner cannot revise an assessment order under section 263 if the issue was raised and dealt with in an appeal to the Appellate Assistant Commissioner, as the revisional power is barred on matters that have been subject to appeal.
An order passed by the Principal Commissioner of Income Tax under Section 263 is liable to be quashed if the Commissioner fails to conduct necessary enquiries before forming the subjective view that the Assessing Officer's order was erroneous and prejudicial to the interest of revenue.
Revisionary proceedings under section 263 are not sustainable if the reasons for reopening the assessment under section 147 are identical to the reasons for invoking revisional jurisdiction, indicating a lack of application of mind.
An order must be read as a whole to understand its true purport. The operative part of an order cannot be read in isolation from the text and findings within the order. An order, including directions, must be based on material on record and not surmises or conjectures.
The Commissioner can only revise an assessment order under Section 263 if it is both erroneous and prejudicial to the interests of the revenue, requiring proof of both conditions with material on record.
The Commissioner cannot pass a revisional order under section 263 merely because the Assessing Officer did not explicitly mention an issue in the assessment order, provided the Assessing Officer made detailed enquiries about the genuineness and creditworthiness of subscribers to funds raised by the assessee.
Initiation of revision proceedings under Section 263 of the Income Tax Act based solely on an audit objection is not valid. Such proceedings are invalid if based on the proposal of the Assessing Officer to the Principal Commissioner of Income Tax for initiation under Section 263.
A 'matter' for the purpose of Section 263 revision can refer to a specific aspect of an issue, not necessarily the entire issue itself. The appellate authority's decision on one aspect does not mean the entire 'matter' has been dealt with.
An ex-parte order under Section 263, passed without considering the assessee's submissions, is not sustainable and is liable to be quashed. When tax is recovered beyond entitlement, technicalities cannot prevent relief, as per Article 265 of the Constitution.
An order passed under section 263 of the Income-tax Act, 1961, must be quashed if it is covered by the decision of a coordinate bench.
