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“lack of enquiry”

Rectification & RevisionSection 263Section 263780 judgments

The decision most relied on for lack of enquiry is Malabar Industrial Co. Ltd. v. CIT (243 ITR 83), cited in 2,943 judgments on BharatTax.

Leading authorities on lack of enquiry

Malabar Industrial Co. Ltd. v. CIT
243 ITR 83 · 2000 · Supreme Court
2,943
citing judgments

For revision under Section 263, the Assessing Officer's order must be both erroneous and prejudicial to the interests of the revenue; if either condition is not met, the revisionary jurisdiction cannot be invoked. An order is not erroneous merely because the Assessing Officer did not record the details of enquiries conducted, provided due enquiries were made.

CIT v. Sunbeam Auto Ltd.
332 ITR 167 · 2011 · High Court
897
citing judgments

The Commissioner cannot revise an assessment under Section 263 merely because the assessment order does not explicitly reflect an inquiry, or because the Commissioner holds a different opinion. An inquiry, even if considered inadequate, or an assessment based on a plausible view by the Assessing Officer after due examination, does not automatically make the order erroneous or prejudicial to the interests of the revenue.

ITO v. D.G. Housing Projects Ltd.
343 ITR 329 · 2012 · High Court
438
citing judgments

For exercising revisional jurisdiction under Section 263, the Commissioner must first find that the Assessing Officer's order is erroneous and unsustainable in law, as this is a condition precedent. An order is not erroneous merely because two views are possible, or if the Commissioner disagrees with the Assessing Officer's permissible view, or to simply remit the matter for further enquiries.

CIT v. Vikas Polymers
341 ITR 537 · 2012 · High Court
318
citing judgments

An assessment order is not erroneous and prejudicial under Section 263 merely because the Assessing Officer did not record an enquiry and its satisfactory answer in the assessment order, provided such an enquiry was conducted. For revision under Section 263, the Commissioner must also provide the assessee an opportunity of being heard and examine their explanation.

CIT v. Anil Kumar Sharma
335 ITR 83 · 2011 · High Court
264
citing judgments

The Commissioner cannot invoke Section 263 for an assessment merely because of an inadequate inquiry by the Assessing Officer, provided there was some inquiry or the record demonstrates application of mind, as this constitutes a mere difference of opinion.

Narayan Tatu Rane v. ITO
70 Taxmann.com 227 · 2016 · ITAT
220
citing judgments

Before revising an assessment order under Section 263, the CIT/PCIT must conduct their own inquiries or verifications to establish that the Assessing Officer's order is erroneous and unsustainable in law, rather than merely directing further inquiry or pointing out the AO's lack of inquiry.

DIT v. Jyoti Foundation
357 ITR 388 · 2013 · High Court
210
citing judgments

An assessment order cannot be deemed erroneous and prejudicial to the interest of revenue under Section 263 if the Assessing Officer conducted an inquiry and applied their mind during the original assessment, as Explanation 2 to Section 263 does not permit unending inquiries by the revisional authority.

CIT v. Infosys Technologies Ltd.
341 ITR 293 · 2012 · High Court
205
citing judgments

A Commissioner can revise an assessment order under Section 263 if it is erroneous and prejudicial to the interests of the revenue. This includes cases where the Assessing Officer fails to make further inquiries before accepting the assessee's statements in the return.

Judgments citing lack of enquiry

Laxmi Narayan Agarwal, Jaipur vs. PCIT, Jaipur-2, Income Tax Department

In the result, appeal of the assessee is allowed

ITA 296/JPR/2023[2016-17]Status: DisposedITAT Jaipur29 Aug 2023AY 2016-17

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Manish Agarwal (C.A.)For Respondent: Shri Arvind Kumar (CIT) a
Section 142(1)Section 143(2)Section 143(3)Section 263

proceedings the assessee has filed confirmation letters but the same 7 Laxmi Narayan Agarwal vs. PCIT, Jaipur-02 were not before the AO. Lack of enquiry and failure to examine the issue has resulted in committing an error by the AO resulting in prejudice to the revenue. 7. From ... intention of the legislature in inserting the Explanation. Small Wonder Industries vs. CIT (ITAT Mumbai) S. 263: There is a distinction between “lack of enquiry” and “inadequate enquiry”. If the AO has called for the necessary details and the assessee has furnished the same, the fact that

Smt. Amanpreet Kaur, Amritsar vs. Principal Commissioner of Income Tax -1, Amritsar

In the result, appeal of the assessee ITA No

ITA 65/ASR/2022[2017-18]Status: DisposedITAT Amritsar23 Aug 2023AY 2017-18

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 142(1)Section 143Section 143(3)Section 263

Sunbeam Auto Ltd 332 ITR 167 (Del) "Revision—Erroneous and prejudicial order—Lack of proper enquiry— There is a distinction between "lack of enquiry" and "inadequate enquiry"—If there is an enquiry, even inadequate, that would not by itself give occasion to the CIT to pass order under ... merely because he has a different opinion in the matter—Such a course of action is open only in cases of "lack of enquiry" CIT V Anil Kumar Sharma 335 ITR 83 (Del) "Revision—Erroneous and prejudicial order—Lack of proper enquiry—CIT came to the conclusion that the issue

Shri Tifs Credit Co-Operative Society Ltd., Rajkot vs. The Pr. CIT-1, Rajkot

The appeal of the assessee is allowed

ITA 115/RJT/2023[2018-19]Status: DisposedITAT Rajkot23 Aug 2023AY 2018-19

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Darshak Thakkar, A.RFor Respondent: Shri Shramdeep Sinha, CIT DR
Section 143(3)Section 80PSection 80P(2)Section 80P(2)(a)

assessee submitted that the Assessing Officer had examined this issue in detail and therefore, it is not a case where there is a lack of enquiry on part of the Assessing Officer during the course of assessment proceedings. Secondly, the Counsel for the assessee submitted that in various judicial precedents

India International Centre, Central Delhi vs. Commissioner of Income Tax (Exemptions), New Delhi

In the result, the appeal of the assessee is allowed

ITA 2940/DEL/2022[2018-2019]Status: DisposedITAT Delhi22 Aug 2023AY 2018-2019

Bench: Shri C.M. Garg & Shri M. Balaganeshassessment Year: 2018-19 India International Centre, Vs Cit(E), 40, Max Mueller Marg, New Delhi. Lodhi Estate, New Delhi – 110 003. Pan: Aaati0660C

For Appellant: Shri Krishna Mohan Prasad, AdvocateFor Respondent: Shri Mohd. Gayasuddin Ansari, CIT,DR
Section 10Section 143(3)Section 2(15)Section 263

PCIT. Further revision proceedings u/s 263 of the Act cannot be initiated for inadequate enquiry and the same could be done only for lack of enquiry. Reliance in this regard is placed on the decision of Hon’ble Supreme Court in the case of Max India Ltd reported

Career Point Limited, Kota, Rajasthan vs. Principal Commissioner of Income Tax, Udaipur, Rajasthan

In the result, the appeal of the assessee is allowed

ITA 242/JPR/2023[2018-19]Status: DisposedITAT Jaipur22 Aug 2023AY 2018-19

Bench: HON’BLE SHRI SANDEEP GOSAIN, JM & HON’BLE SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Vijay Goyal, CA &For Respondent: Shri Ajey Malik (CIT)
Section 143(2)Section 143(3)Section 14ASection 263

units are headed by Principal Commissioner of Income Tax, therefore, in a faceless regime, normally there cannot be a case of prejudice of lack of enquiry for the reason that there is application of mind by multiple officers of Department and not by a single officer, therefore, the revision proceedings ... assessment order cannot be held to be erroneous simply on the allegation of inadequate enquiry. Unless there is an established case of total lack of enquiry; 1.15. It is pertinent to note that the assessment in the case of assessee firm for the year under consideration was carried

Nahar Colours and Coatinhgs Private Limited, Udaipur vs. Principal Commissioner Ofincometax, Udaipur

In the result, appeal of the assessee is allowed

ITA 140/JODH/2023[2018-19]Status: DisposedITAT Jodhpur09 Aug 2023AY 2018-19
Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 263Section 801ASection 80I

terms of 7 Nahar Colours and Coatings Private Ltd section 36(1)(va) r.w.s. 2(24)(x) of the Act. Therefore, due to lack of enquiry and due to incorrect and incomplete appreciation of facts, the assessment order is erroneous in so far as it is prejudicial to the interest ... satisfactory and did not explain all facts. Tribunal recorded a finding that Assessing Officer had simply accepted claim of assessee without examining records. Lack of enquiry by Assessing Officer led to rendering his order erroneous and prejudicial to interest of revenue. Commissioner was justified in passing an order invoking power

Smt. Nishaben Harenbhai Doshi, Rajkot vs. The Pr. CIT-1, Rajkot

In the result, the appeal of the assessee is allowed

ITA 32/RJT/2022[2012-13]Status: DisposedITAT Rajkot04 Aug 2023AY 2012-13

Bench: Smt. Annapurna Gupta & Shri Siddhartha Nautiyal

For Appellant: Shri R. D. Lalchandani, AdvocateFor Respondent: Shri Shramdeep Sinha, CIT DR
Section 263

provisions of law which needs to be done now. Smt. Nisha Haren Doshi vs. PCIT Asst.Year –2012-13 Therefore, due to lack of enquiry and investigation in the matter besides in application of law, the assessment completed by the AO needs to be set-aside for fresh assessment.” 4. Before

Shri Avtar Singh Through L/Heair Shri Gurtej Singh, Kapurthala vs. Principal Commissioner of Income Tax -1, Jalandhar

In the result, appeal of the assessee ITA No

ITA 165/ASR/2023[2018-19]Status: DisposedITAT Amritsar03 Aug 2023AY 2018-19

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 142(1)Section 143Section 143(3)Section 263

assessee which need to be verified since such verifications/enquiries have not been made by the Assessing Officer at assessment stage. The lack of enquiry by the AO in respect of the issues raised in the revisionary proceeding amounts to the assessment order to be erroneous in so far as prejudicial

Dristi Textiles Pvt. Ltd., Ghaziabad vs. Pr. CIT, Ghaziabad

ITA 3813/DEL/2019[2014-15]Status: DisposedITAT Delhi03 Aug 2023AY 2014-15

Bench: Shri Narendra Kumar Billaiya & Shri Anubhav Sharma

Section 143(3)Section 263Section 68

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B ”: NEW DELHI BEFORE SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT MEMBER AND

Shree Murlidhar Jewellers, Jamnagar vs. The Pr.CIT-IV, Jamnagar

In the result, the appeal of the assessee is allowed

ITA 27/RJT/2020[2016-17]Status: DisposedITAT Rajkot02 Aug 2023AY 2016-17

Bench: Smt.Annapurna Gupta & Shri T.R. Senthil Kumarassessment Year :2016-17 Shree Murlidharjewellers Vs. The Pr.Cit-4 Chandi Bazar Jamnagar. Jamnagar 361 001. Pan : Aaifs 4781 N अपीलाथ"/ (Appellant) "" यथ"/(Respondent) Assesseeby : Shri D.M. Rindani, Ar Revenue By : Shri Shramdeep Sinha, Ld.Cit-Dr सुनवाई क" तार"ख/Date Of Hearing : 17/05/2023 घोषणा क" तार"ख /Date Of Pronouncement: 02/08/2023 आदेश/O R D E R Per Annapurna Guptapresent Appeal Has Been Filed By The Assessee Against Order Passed By The Ld.Pr.Commissioner Of Income-Tax)-4, Jamnagar [Hereinafter Referred To As “Ld.Pr.Cit)”] Dated 11.12.2019In Exercise Of His Revisionary Power Under Section 263 Of The Income Tax Act , 1961 ("The Act" For Short) Over The Assessment Order Passed U/S 143(3) Of The Act Pertaining To Asst.Year 2016-17. 2. The Assessee Has Raised The Following Grounds Before Us: I) The Learned Principal Commissioner Of Income-Tax - 4, Jamnagar Erred In Assuming Jurisdiction U/S 263 Of The Act, Particularly In The Light Of Reasons Stated By Him In The Show Cause Notice & In The Order Passed U/S 263 Of The Act & Hence The Impugned Order Is Bad In Law. 2 Ii) The Learned Principal Commissioner Of Income-Tax - 4, Jamnagar Erred In Directing The Assessing Officer To Make Addition Of Rs. 70,89,098/- U/S 69 Of The Act By Failing To Appreciate That Provisions Of Section 69 Were Not Attracted In.”

For Appellant: Shri D.M. Rindani, ARFor Respondent: Shri Shramdeep Sinha, ld.CIT-DR
Section 115BSection 143(3)Section 263Section 69

assessment were either perverse or contrary to law. In view of such matter, we are constrained to hold no case of perversity or lack of enquiry on the part of the Assessing Officer is made out so as to render his decision erroneous under Explanation 2 of section

Allied Photographics India Ltd., Mumbai vs. PCIT, Mumbai-1, Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 1083/MUM/2023[2018-19]Status: DisposedITAT Mumbai01 Aug 2023AY 2018-19

Bench: Shir Pavan Kumar Gadale & Shri S Rifaur Rahmanm/S Alliedphotographics Vs. Pr.Cit-1, India Ltd., 3Rd Floor, Room No.330, Kasturi Buildings, 3Rd Floor, Jamshedji Tata Road, Aayakar Bhavan, Churchgate, M.K. Road, Mumbai -400020. Mumbai-400020. Pan/Gir No. : Aabca2068A Appellant .. Respondent Appellant By : Mr.Nitish Gandhi.Ar Respondent By : Ms.Smiti Samant. Dr Date Of Hearing 15.06.2023 Date Of Pronouncement 02.08.2023 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Pr. Commissioner Of Income Tax (Pr.Cit)-1, Mumbai Passed U/S 263 Of The Act. The Assessee Has Raised The Fallowing Grounds Of Appeal.

For Appellant: Mr.Nitish Gandhi.ARFor Respondent: Ms.Smiti Samant. DR
Section 10Section 143(3)Section 2(14)Section 2(14)(iii)Section 263

matter to the Assessing Officer to decide whether the findings recorded are erroneous. In cases where there is inadequate enquiry but not lack of enquiry, again the Commissioner of Income tax must give and record a finding that the order/inquiry made is erroneous. ITA Nos. 1083/Mum/2023 M/s Allied Photographics India

Au Small Finance Bank Limited, Jaipur vs. Principal Commissioner of Income Tax, Jaipur-1

In the result both the appeals filed by the assessee in ITA

ITA 203/JPR/2022[2017-18]Status: DisposedITAT Jaipur28 Jul 2023AY 2017-18

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Sanjay Jhanwar, Sr. AdvocateFor Respondent: Shri James Kurian, CIT
Section 115JSection 263Section 35ASection 36(1)(viia)

order merely because he has a different opinion on matter.” Small Wonder Industries vs. CIT-24, Mumbai ITANo.2464/Mum/2013 “There is a distinction between “lack of enquiry” and “inadequate enquiry”. If the AO has called for the necessary details and the assessee has furnished the same, the fact that

Monsanto Investments India Pvt. Ltd., Thane vs. Pr. CIT- 2, Mumbai

In the result, the appeal by the assessee is dismissed

ITA 1894/MUM/2021[2015-16]Status: DisposedITAT Mumbai27 Jul 2023AY 2015-16

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Smt. Riddhi Mishra
Section 142(1)Section 143(2)Section 143(3)Section 153Section 263

passed under section 143(3) of the Act is erroneous insofar as it is prejudicial to the interest of the Revenue due to lack of enquiry by the Assessing Officer as per Explanation 2 to section 263 of the Act. Accordingly, the learned PCIT set aside the assessment order passed

M/S. T.C. Software Consultancy Pvt. Ltd, Mumbai vs. PCIT -1, Mumbai

In the result, the appeal filed by the assessee is dismissed

ITA 1218/MUM/2022[2011-12]Status: DisposedITAT Mumbai21 Jul 2023AY 2011-12

Bench: Ms. Padmavathy S. () & Shri Rahul Chaudhary ()

Section 133(6)Section 143(3)Section 263Section 56(1)Section 68

seized without further enquiry or verification of details. Therefore we are inclined to agree with the finding of the PCIT that there is lack of enquiry on the part of the Assessing Officer as far as one leg of the transaction is concerned where assessee is claimed ... based on facts specific to each case. Further the PCIT while invoking the explanation has given a clear finding with regard to the lack of enquiry on the part of the assessing officer and has accordingly held the order to erroneous and prejudicial to the interest of the revenue

Jasbir Singh, Delhi vs. Pr, CIT, Delhi-20, Delhi

In the result the appeal of the assessee in ITA No

ITA 422/DEL/2022[2012-13]Status: DisposedITAT Delhi20 Jul 2023AY 2012-13

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Ms. Gunjan Jain, CAFor Respondent: Shri Waseem Arshad, CIT-DR
Section 142(1)Section 143(3)Section 148Section 263

explained by the PCIT. According to the ld. DR, the PCIT should have arrived at a finding on material as regards the lack of enquiry. Mere posing queries and not going into detailed examination only means non-application of mind by the Assessing Officer and, therefore, the PCIT has rightly ... Explanation 2 to section 263 of the Act, the ld. DR concluded by stating that there is a distinction between inadequate enquiry and lack of enquiry which stands obliterated by Explanation 2 to section 263 of the Act and in his written synopsis, the ld. DR has placed reliance

DCIT Central Circle-01, Delhi vs. Spicejet Ltd., Delhi

In the result, appeal of the Revenue is dismissed

ITA 881/DEL/2022[2014-15]Status: DisposedITAT Delhi17 Jul 2023AY 2014-15

Bench: Sh. Saktijit Deydr. B. R. R. Kumar

For Appellant: Sh. Tarandeep Singh, AdvFor Respondent: Sh. Vizay Vasanta, CIT DR
Section 37(1)Section 40

inquired upon by the Assessing Officer during the course of original assessment proceedings. Thus this is not a case of lack of enquiry. We agree Spicejet Ltd. with the submissions made by the appellant that the payment of supplementary lease rent in the present case is not for provision

DCIT Central Circle-01, Delhi vs. Spicejet Ltd., Haryana

In the result, appeal of the Revenue is dismissed

ITA 880/DEL/2022[2013-14]Status: DisposedITAT Delhi17 Jul 2023AY 2013-14

Bench: Sh. Saktijit Deydr. B. R. R. Kumar

For Appellant: Sh. Tarandeep Singh, AdvFor Respondent: Sh. Vizay Vasanta, CIT DR
Section 37(1)Section 40

inquired upon by the Assessing Officer during the course of original assessment proceedings. Thus this is not a case of lack of enquiry. We agree Spicejet Ltd. with the submissions made by the appellant that the payment of supplementary lease rent in the present case is not for provision

Dinesh Kumar Chaurasia, Tonk vs. PCIT Central, Jaipur

In the result, appeal of the assessee is dismissed

ITA 102/JPR/2023[2018-19]Status: DisposedITAT Jaipur17 Jul 2023AY 2018-19

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Sh. Mahendra Gargieya (Adv.)For Respondent: Sh. Ajey Malik (CIT)
Section 143(3)Section 263Section 5

Assessment order cannot be held to be erroneous simply on the allegation of inadequate enquiry unless there is an established case of total lack of enquiry. Kindly refer CIT vs. Sunbeam Auto Ltd. (2011) 332 ITR 167 (Del) (wherein Delhi High Court was considering the aspect, when there

Maa Narmada Agrotech and Infrastures Ltd, Indore vs. The PCIT-1, Indore

In the result, appeal of assessee is allowed

ITA 117/IND/2022[2017-18]Status: DisposedITAT Indore11 Jul 2023AY 2017-18

Bench: Shri Vijay Pal Rao & Shri B.M. Biyanimaa Narmada Agrotech & Pcit Infrastructures Limited Indore -1 Ug-47, Trade Centre, Vs. Kanchan Bagh Main Road, Indore (Appellant / Assessee) (Respondent/ Revenue) Pan: Aafcm6285 P Assessee By Shri S.N. Goyal & Shri Pranay Goyal, Ars Revenue By Shri P.K. Mishra, Cit-Dr Date Of Hearing 31.05.2023 Date Of Pronouncement 11.07.2023

Section 139(1)Section 143(3)Section 263

matter to the assessing officer to decide whether the findings recorded are erroneous. In cases where there is inadequate enquiry but not lack of enquiry, again the CIT must give and record a finding that the order/enquiry made is erroneous. This can happen if an enquiry and verification is conducted ... details and records produced before him were examined and thereafter the returned income is accepted. Thus it is not a case of lack of enquiry on the part of the AO. Though the AO has not discussed the issue in elaborate manner, but once he was satisfied with the supporting

Shri Vijay Kumar Singhla, Mansa vs. Principal Commissioner of Income Tax-1, Amritsar

In the result, the appeal filed by the assessee is allowed

ITA 100/ASR/2022[2012-13]Status: DisposedITAT Amritsar06 Jul 2023AY 2012-13

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 142(1)Section 143(3)Section 148Section 263Section 69A

Observation of the Commissioner that the income-tax officers did not make sufficient enquiries is totally subjective. It was not a case of lack of enquiry. The Commissioner judged the "sufficiency of enquiry" by subjective standards. It appears that according to the Commissioner, more enquiries should have been made