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“lack of inquiry”

Rectification & RevisionSection 263Section 2631,087 judgments

The decision most relied on for lack of inquiry is CIT v. Gabriel India Ltd. (203 ITR 108), cited in 990 judgments on BharatTax.

Leading authorities on lack of inquiry

CIT v. Gabriel India Ltd.
203 ITR 108 · 1993 · High Court
990
citing judgments

The Commissioner cannot revise an assessment order under Section 263 merely because they hold a different opinion or believe a deeper inquiry was warranted if the Assessing Officer has applied their mind and conducted some inquiry. Revision under Section 263 is permissible only in cases of a complete lack of inquiry or non-application of mind by the Assessing Officer, not for merely inadequate inquiry.

CIT v. Orissa Corporation Pvt. Ltd.
159 ITR 78 · 1986 · Supreme Court
897
citing judgments

When an assessee provides the identity and address of a creditor or investor for a cash credit or share capital under Section 68, the burden shifts to the Department to establish lack of genuineness or creditworthiness, requiring it to conduct further inquiries; mere non-compliance by third parties to summons cannot be the sole basis for an adverse inference against the assessee.

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.

Gee Vee Enterprises v. Addl. CIT
99 ITR 375 · 1975 · High Court
543
citing judgments

An assessment order is erroneous and prejudicial to the interest of revenue if the Assessing Officer fails to make proper inquiries before accepting the assessee's statements or claims. The Commissioner can revise such an order under Section 263 without conducting further inquiries himself.

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 inquiry

M/S. Aditya Birla Insurance Brokers Ltd., Mumbai vs. Pr. CIT -2, Mumbai

In the result, appeal of the assessee stands dismissed

ITA 935/MUM/2021[2016-17]Status: DisposedITAT Mumbai27 Oct 2021AY 2016-17
Section 115JSection 143(3)Section 263Section 80G

under section 263 of the Act as per extant provisions of the Act. That the issue of inadequate, improper inquiry vis-a- vis lack of inquiry has already been settled in the following case laws :- • CIT Vs. Nirav Modi 390 ITR 292 (Bombay) • Sunbeam Auto (332 ITR 167) (Delhi ... without any examination, can by no stretch of imagination be called on inquiry, alone due inquiry. This itself is a reflection of the lack of inquiry by the Assessing Officer and hence, absence of inquiry is palpable. Though we are not inclined to agree to the manner of examination suggested

Satyam Textile Park, Surat vs. Pr. Commissioner of Income Tax (Central), Surat

In the result the ground No

ITA 91/SRT/2021[2017-18]Status: DisposedITAT Surat25 Oct 2021AY 2017-18

Bench: Shri Pawan Singh & Dr Arjun Lal Saini

Section 133ASection 142(1)Section 143(3)Section 153CSection 254(1)Section 263Section 271DSection 40

Satyam Textile Park made further inquiry. Thus, the ld. PCIT has not made a case that there was “no enquiry” or “lack of inquiry” rather recorded that the AO called detailed inquiry. We find that the ld. PCIT has not specified that what kind of further inquiry was required, when

Satyam Textile Park, Surat vs. Pr. Commissioner of Income Tax (Central), Surat

In the result the ground No

ITA 90/SRT/2021[2016-17]Status: DisposedITAT Surat25 Oct 2021AY 2016-17

Bench: Shri Pawan Singh & Dr Arjun Lal Saini

Section 133ASection 142(1)Section 143(3)Section 153CSection 254(1)Section 263Section 271DSection 40

Satyam Textile Park made further inquiry. Thus, the ld. PCIT has not made a case that there was “no enquiry” or “lack of inquiry” rather recorded that the AO called detailed inquiry. We find that the ld. PCIT has not specified that what kind of further inquiry was required, when

Amrut Sarovar, Surat vs. Pr. Commisioner Income Tax(Central), Surat

In the result the grounds of appeal raised by the assessee in all three assessment years are allowed

ITA 94/SRT/2021[2016-17]Status: DisposedITAT Surat21 Oct 2021AY 2016-17

Bench: Shri Pawan Singh & Dr. Arjun Lal Saini

Section 133ASection 142(1)Section 143(3)Section 153CSection 254(1)Section 263

noted that AO has not made further inquiry. Thus, the ld. PCIT has not made a case that there was “no enquiry” or “lack of inquiry” rather recorded that the AO called detailed inquiry. We find that the ld. PCIT has not specified that what kind of further inquiry

Amrut Sarovar, Surat vs. Pr. Commisioner Income Tax(Central), Surat

In the result the grounds of appeal raised by the assessee in all three assessment years are allowed

ITA 93/SRT/2021[2015-16]Status: DisposedITAT Surat21 Oct 2021AY 2015-16

Bench: Shri Pawan Singh & Dr. Arjun Lal Saini

Section 133ASection 142(1)Section 143(3)Section 153CSection 254(1)Section 263

noted that AO has not made further inquiry. Thus, the ld. PCIT has not made a case that there was “no enquiry” or “lack of inquiry” rather recorded that the AO called detailed inquiry. We find that the ld. PCIT has not specified that what kind of further inquiry

Amrut Sarovar, Surat vs. Pr. Commisioner Income Tax(Central), Surat

In the result the grounds of appeal raised by the assessee in all three assessment years are allowed

ITA 92/SRT/2021[2014-15]Status: DisposedITAT Surat21 Oct 2021AY 2014-15

Bench: Shri Pawan Singh & Dr. Arjun Lal Saini

Section 133ASection 142(1)Section 143(3)Section 153CSection 254(1)Section 263

noted that AO has not made further inquiry. Thus, the ld. PCIT has not made a case that there was “no enquiry” or “lack of inquiry” rather recorded that the AO called detailed inquiry. We find that the ld. PCIT has not specified that what kind of further inquiry

Lovely Fragrance, Mumbai vs. Pr. CIT - 24, Mumbai

In the result, appeal by the assessee stands allowed

ITA 3096/MUM/2019[2014-15]Status: DisposedITAT Mumbai20 Oct 2021AY 2014-15
Section 115JSection 143(3)Section 263Section 80Section 80I

catena of judgments, wherein it has been held that powers u/s. 263 of the Act can be invoked only in cases of "lack of inquiry" by the Assessing but not where there was "inadequate inquiry". Various decisions of Hon'ble High courts have been cited in this connection. (vi) That ... conducted any kind of inquiry. (ii) It would follow from the above that this was a case, not of 'inadequate inquiry' but of 'lack of inquiry'. Conducting inquiry involves a process not just of obtaining information, but also of processing and analyzing the information for arriving at some conclusion, depending

Kapil Mehta, Delhi vs. PCIT(Central)-3, New Delhi

The appeal of the assessee stands dismissed

ITA 533/DEL/2021[2017-18]Status: FixedITAT Delhi11 Oct 2021AY 2017-18

Bench: The Assessing Officer

Section 131Section 132Section 143(3)Section 153ASection 263Section 263(1)

Enterprises speaking for High Court of Delhi their lordships made a clear distinction between the cases of “inadequate inquiry” and “lack of inquiry” by also considering the ratio of the decision of Hon’ble Apex Court in the case of Rampyari Devi Sarogi vs CIT (supra) and Tara Devi Aggarwal ... revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between “lack of inquiry” and “inadequate inquiry”. If there was any inquiry, even inadequate that would not by itself give occasion to the Commissioner to pass orders under section

Auto Engineers Services Centre, New Delhi vs. Pr. CIT, New Delhi

In the result, the appeal of the assessee is allowed

ITA 1104/DEL/2020[2015-16]Status: DisposedITAT Delhi11 Oct 2021AY 2015-16

Bench: Shri Amit Shukla & Dr. B.R.R. Kumar

For Appellant: Shri P. Roy Chauduri, AdvFor Respondent: Shri Satpal Gulati, CIT-D.R
Section 143(3)Section 263Section 40

himself carrying out any inquiry to find out what was the inadequate inquiry carrying out by the Assessing Officer or there was any lack of inquiry, he cannot set aside the assessment order. Simply stating that Assessing Officer has not examined the purchases or GP without verifying the records

M/S. Jns Instruments Ltd., New Delhi vs. Pr. CIT, New Delhi

The appeal of the assessee stands dismissed

ITA 1479/DEL/2017[2011-12]Status: DisposedITAT Delhi11 Oct 2021AY 2011-12

Bench: Shri Sudhanshu Srivastava & Shri Prashant Maharishiasstt. Year : 2011-12 Jns Instruments Ltd. Vs. Pr. Cit Gi-48, G.T. Karnal Road Central -2, New Delhi. Jhandewalan Pan Aaacj7034Q New Delhi. (Appellant) (Respondent)

For Appellant: Shri Shailesh Gupta, AdvFor Respondent: Ms. Sunita Singh, CIT (DR)
Section 132(1)Section 143(3)Section 153Section 153ASection 263Section 92C

would have passed the assessment order after duly considering that the Ld. AR further submitted that it was not a case of lack of inquiry and at most it could be said that there was an inadequate inquiry but such orders could not have been revised ... Instruments Ltd. vs Pr.CIT and, thereafter, adjudicated the issue, we are constrained to hold that this is a clear case of lack of inquiry by the AO. Even the assessment order is very cryptic in as much as it does not even mention as to what issues were before

Reliance Life Sciences P. Ltd., Mumbai vs. Pr. CIT-8, Mumbai

The appeals stand allowed in terms of our above order

ITA 533/MUM/2021[2014-15]Status: DisposedITAT Mumbai05 Oct 2021AY 2014-15

Bench: Hon’Ble Shri Pavan Kumar Gadale, Jm & Hon’Ble Shri Manoj Kumar Aggarwal, Am (Hearing Through Video Conferencing Mode) 1. आयकरअपील सं./ I.T.A. No.533/Mum/2021 (धििाारण वर्ा / Assessment Year: 2014-15) & 2. आयकरअपील सं./ I.T.A. No.534/Mum/2021 (धििाारण वर्ा / Assessment Year: 2015-16) Reliance Life Sciences Pvt. Ltd. Pr. Cit - 8 Dhirubhai Ambani Life Sciences Centre, Aaykar Bhavan, M. K. Road, बिाम/ R-282, Ttc Area Of Midc Mumbai-400 020 Vs. Thane Belapur Road, Rabale, Navi Mumbai-400 701 स्थायीलेखासं./जीआइआरसं./ Pan/Gir No. Aabcr-7594-L (अपीलाथी/Appellant) : (प्रत्यथी / Respondent) अपीलाथीकीओरसे/ Appellant By : Shri Nimesh Vora-Ld. Ar प्रत्यथीकीओरसे/Respondent By : Shri Anand Mohan-Ld. Cit-Dr सुनवाईकीतारीख/ : 07/09/2021 Date Of Hearing घोषणाकीतारीख / : 05/10/2021 Date Of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal () 1.1 As Per The Provisions Of Section 263 Of Income Tax Act, 1961, The Revenue Authorities Namely Pr. Commissioner Of Income Tax / Commissioner Of Income Tax Is Vested With The Supervisory Powers Of Suo-Moto Revision Of Any Order Passed By The Assessing Officer [Ao]. For The Said Purpose, The Appropriate Authority May Call For & Examine

For Appellant: Shri Nimesh Vora-Ld. ARFor Respondent: Shri Anand Mohan-Ld. CIT-DR
Section 263

revenue. 1.4 The Hon’ble Delhi Court, in the cited decision, further observed that there is a fine though subtle distinction between "lack of inquiry" and "inadequate inquiry". It is only in cases of "lack of inquiry" that the Commissioner is empowered to exercise his revisional powers by calling

Abis Broiler Private Limited( A Private Limited Company), Rajnandgaon vs. Assistant Commissioner of Income Tax, Central-2, Raipur

In the result, the appeal of the assessee is allowed

ITA 92/RPR/2019[2012-13]Status: DisposedITAT Raipur29 Sept 2021AY 2012-13

Bench: Shri Pradip Kumar Kedia & Shri N. K. Choudhryआयकर आयकर अपील आयकर आयकर अपील अपील संसंसंसं./I.T.A. No.92/Rpr/2019 अपील िनधा"रण वष" वष" / Assessment Year : 2012-13) (िनधा"रण िनधा"रण िनधा"रण वष" वष" Abis Broiler Private Limited, Assistant Commissioner बनाम/ बनाम बनाम बनाम C/O. Ib Group Corporate Of Income-Tax, Vs. House, Village Indamara, Post Central-2, Pendri, District Rajnandgaon, Raipur Chhattisgarh "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aahca 6940 P .. (अपीलाथ" /Appellant) (""यथ" / Respondent) Shri Amit M. Jain, Ca अपीलाथ" ओर से /Appellant By : Shri R.K. Singh, Cit-Dr ""यथ" क" ओर से/Respondent By : 29.07.2021 सुनवाई क" तारीख / Date Of Hearing 29.09.2021 घोषणा क" तारीख /Date Of Pronouncement आदेश/O R D E R

For Appellant: Shri R.K. Singh, CIT-DRFor Respondent: 29.07.2021
Section 153ASection 263

Section 263 of the Act. On perusal of the show- cause notice, it is apparent that the PCIT himself has not alleged a lack of inquiry in the matter; but has avered that adequate inquires were not carried out in the matter. We do not understand the purport of such

Mahendra H. Shah, Mumbai vs. ITO - Ward- 4 (1)(3), Mumbai

ITA 6892/MUM/2018[2012-13]Status: DisposedITAT Mumbai27 Sept 2021AY 2012-13

Bench: Shri C.N. Prasad, Hon’Bleshri Mahendra H. Shah V. Income Tax Officer – 4(1)(3) 6Th Floor, Aayakar Bhavan C/O. The Presscopper Industries M.K. Road, Mumbai - 400020 175, Kika Street Mumbai – 400004 Pan: Aafps0929R (Appellant) (Respondent)

For Appellant: Vimal PunmiyaFor Respondent: Smita Verma
Section 132(4)Section 133(4)Section 143(1)Section 143(2)Section 68

conduct proper enquiry shifts to CIT(A) and on Tribunal and cannot delete the addition made by AO on the ground of lack of inquiry. • On the issue of retraction statement filed by the PKJ group of companies. The DDIT (Inv.) has promptly acted on the retraction statemnt filed

M/S R.R.Ispat Ltd, Raipur vs. C.I.T-1, Raipur

In the result, appeal filed by the Assessee stands allowed

ITA 71/BIL/2015[2010-11]Status: DisposedITAT Raipur23 Sept 2021AY 2010-11

Bench: Shri Pradip Kumar Kedia, Hon'Ble & Shrin.K. Choudhry, Hon’Ble

For Appellant: ShriR.B. Doshi, CAFor Respondent: Shri P.K. Mishra, CIT DR
Section 143(3)Section 263Section 263(1)Section 263iSection 32Section 32(1)(iia)

section 263, the Assessee has produced certain evidence that the wind mill was commissioned before 31/03/2010 but the claim of Assessee requires verification. Lack of inquiry by the assessing officer renders the assessment order as erroneous. (M/s. RR Ispat Limited) 4.3 Regarding claiming additional depreciation on power generation, the Assessee

Rameshwar Prasad Shringi, Gumanpura vs. Pr.CIT, Udaipur

In the result, the appeal of the assessee is allowed

ITA 10/JPR/2021[2016-17]Status: DisposedITAT Jaipur23 Sept 2021AY 2016-17
For Appellant: Sh. Mahendra Gargieya (Adv.) &For Respondent: Sh. B. K. Gupta (Pr. CIT)
Section 143(2)Section 143(3)Section 263

revenue is suspecting same. This double standard cannot be permitted. 6.1 It is not the case of CIT that there was a complete/total lack of inquiry. He himself admits at many places in the Assessment order and in particular in para 6.5 when he admits that “….merely on the basis ... revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between “lack of inquiry” and “inadequate inquiry”. If there was any inquiry, even inadequate that would not by itself give occasion to the CIT to pass orders under section

M/S. Origami Cellulo Private Limited, Bengaluru vs. Principal Commissioner of Income Tax - 5, Bengaluru

In the result, the appeal of the assessee is allowed

ITA 394/BANG/2020[2015-16]Status: DisposedITAT Bangalore15 Sept 2021AY 2015-16

Bench: Shri N.V. Vasudevan & Shri Chandra Poojariassessment Year : 2015-16

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Pradeep Kumar, CIT(DR-III)(ITAT), Bengaluru
Section 142(1)Section 143(2)Section 143(3)Section 263Section 40A(2)(b)Section 92A(2)Section 92C

became erroneous but such an error also caused prejudice to the revenue. In our considered view one also has understand the difference between "lack of inquiry" and "inadequate inquiry" and when it can be termed as erroneous for usurpation of jurisdiction u/s 263 of the Act. For better understanding ... revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between "lack of inquiry" and "inadequate inquiry". If there was any inquiry, even inadequate, that would not by itself, give occasion to the Commissioner to pass orders under section

Annu Agrotech Private Limited, Kota vs. Pr.CIT, Udiaipur

In the result, this appeal of the assessee is allowed

ITA 9/JPR/2021[2016-17]Status: DisposedITAT Jaipur15 Sept 2021AY 2016-17

Bench: Shri Sandeep Gosain, Jm & Shri Vikram Singh Yadav, Am Vk;Dj Vihy La-@Ita No. 09/Jp/2021 Assessment Year: 2016-17 Cuke Annu Agrotech Private Limited, Pr.Cit, S-47/48, S-47/48, Vs. Udaipur. Commercial Shops, Ipia 324005, Rajasthan, India. Pan No.: Aagca 5903 M Vihykfkhz@Appellant Izr;Fkhz@Respondent Fu/Kzkfjrh Dh Vksj Ls@ Assessee By : Shri Mahendra Gargieya(Adv.) & Shri Devang Gargieya (Itp) Jktlo Dh Vksj Ls@ Revenue By : Shri B.K. Gupta (Pr.Cit-Dr) Lquokbz Dh Rkjh[K@ Date Of Hearing : 27/07/2021 Mn?Kks"K.Kk Dh Rkjh[K@ Date Of Pronouncement : 15 /09/2021 Vkns'K@ Order

For Appellant: Shri Mahendra Gargieya(Adv.) &For Respondent: Shri B.K. Gupta (Pr.CIT-DR)
Section 115JSection 143(3)Section 263Section 56(2)(vii)Section 56(2)(viib)Section 68

dated 16.11.2018, could not have been ignored by the AO. 6.1 It is not the case of CIT that there was a complete/total lack of inquiry. He himself admits in the Impugned Order that the AO did make enquiry on both the issues. The law is well settled that ... revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between “lack of inquiry” and “inadequate inquiry”. If there was any inquiry, even inadequate that would not by itself give occasion to the CIT to pass orders under section

Reliance Industries Ltd., Mumbai vs. Pr. CIT (PCIT)-3, Mumbai

The appeal stands allowed in terms of our above order

ITA 578/MUM/2021[2011-12]Status: DisposedITAT Mumbai01 Sept 2021AY 2011-12
For Appellant: Shri Nimesh Vora, Ld. ARFor Respondent: Shri Vinay Sinha, Ld. CIT-DR
Section 263

revenue. 1.4 The Hon’ble Delhi Court, in the cited decision, further observed that there is a fine though subtle distinction between "lack of inquiry" and "inadequate inquiry". It is only in cases of "lack of inquiry" that the Commissioner is empowered to exercise his revisional powers by calling

Rajasthan State Mines & Minerals Ltd., Jaipur vs. PCIT-2, Jaipur

In the result, the appeal of the assessee is allowed

ITA 33/JPR/2021[2016-17]Status: DisposedITAT Jaipur31 Aug 2021AY 2016-17
For Appellant: Sh. P. C. Parwal (CA)For Respondent: Sh. B. K. Gupta (Pr.CIT)
Section 142(1)Section 143(3)Section 263Section 37(1)

under consideration, the opinion formed by the Assessing Officer cannot be held as erroneous in nature. It is therefore not a case of lack of inquiry as held by the ld. Pr. CIT rather it is a case where the Assessing Officer has taken into consideration the factual ... Court decisions, the opinion formed by the Assessing Officer cannot be held as erroneous in nature. It is therefore not a case of lack of inquiry as held by the ld. Pr. CIT rather it is a case where the Assessing Officer has taken into consideration the factual

M/S Active Tools (P). Limited, Jalandhar vs. Deputy Commissioner of Income Tax Circle -II, Jalandhar

ITA 260/ASR/2019[2014-15]Status: DisposedITAT Amritsar16 Aug 2021AY 2014-15

Bench: : Shri Laliet Kumar & Dr. Mitha Lal Meena

Section 115Section 133ASection 142(1)Section 154Section 68Section 69Section 69ASection 69BSection 69CSection 69D

case of CIT vs. Anil Kumar Sharma 335 ITR 83 has held as under: ITA 260/Amr/2019 20 "There is a distinction between "lack of inquiry" and 'inadequate inquiry" If there was any inquiry, even inadequate that would not by itself give occasion to the Commissioner to pass orders under section ... merely because he has a different opinion in the matter: “Held, dismissing the appeal, that the present case would not be one of "lack of inquiry" even if the inquiry was termed inadequate. The Tribunal found that complete details were filed before the Assessing Officer and that he applied hismind