“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

Binitaben Sandipkumar Patel, Vadodara vs. The Pr.CIT, Vadodara-1, Vadodara

The appeal of the assessee is allowed

ITA 702/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad28 Jul 2025AY 2018-19

Bench: Ms.Suchitra R. Kamble & Shri Makarand V.Mahadeokarasstt.Year : 2018-19 Sejalben Patel The Pr.Cit-1 1049, Kantvalue Faliyu Vs. Vadodara. At & Po-Karkhadi Tal. Padra, Dist. Vadodara. Pan : Drhpp 9550 D Asstt.Year : 2018-19 Binitaben Sandipkumar Patel The Pr.Cit-1 Javla, Chotra Pase Vs. Vadodara. Savli, Dist. Vadodara. Pan : Cwopp 4609 Q (Applicant) (Responent)

For Appellant: Ms.Urvashi Sodhan, AR

Section 139(1)Section 144BSection 147Section 148Section 194Section 263Section 31Section 54

Assessing Officer failed to properly coordinate or await the response to the reference to the Valuation Officer, and this lapse amounted to lack of inquiry on a crucial aspect of the computation of capital gains. ITA No.701 & 702/Ahd/2025 9 6. We have carefully considered the rival submissions made

Sejalben Patel, Vadodara vs. The Pr.CIT, Vadodara-1, Vadodara

The appeal of the assessee is allowed

ITA 701/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad28 Jul 2025AY 2018-19

For Appellant: Ms.Urvashi Sodhan, AR

Section 139(1)Section 144BSection 147Section 148Section 194Section 263Section 31Section 54

DCIT, Circle 3(1), Visakhapatnam vs. Vikas Kumar Chhajer, Vizianagaram

ITA 212/VIZ/2025[2022-23]Status: DisposedITAT Visakhapatnam25 Jul 2025AY 2022-23

Bench: Us:

Section 132Section 143(2)Section 143(3)Section 68

proper inquiry shifts to Commissioner (Appeals) and CIT(A) cannot simply delete the addition made by the Assessing Officer on the ground of lack of inquiry by the Assessing Officer or on the ground that the assessee has not been given an opportunity to cross examine the third parties

Nirmal Bang Securities Private Limited, Mumbai vs. Principal Commissioner of Income Tax, Mumbai 4, Mumbai

The appeal of the appellant is dismissed

ITA 2454/MUM/2025[2020-21]Status: DisposedITAT Mumbai25 Jul 2025AY 2020-21

Bench: Shri Narender Kumar Choudhry (Jm) & Shri Omkareshwar Chidara (Am) Nirmal Bang Securities P. Ltd. Pcit B-2, Marathon Innova, Aayakar Bhavan Ganpatrao Kadam Marg Vs. M.K. Road Opp. Peninsula Corporate Churchgate Lower Parel West Mumbai-400 020. Mumbai-400 013. Pan : Aaacn7369I Appellant Respondent

For Appellant: Shri Leyaqat Ali AafaquiFor Respondent: Shri Anant N. Pai

Section 135Section 143(3)Section 263Section 37Section 80GSection 80G(2)(iiihk)

inquiry by the Assessing Officer on the deduction of Rs. 16,21,276/- claimed under Section 80G out of the CSR expenditure. This lack of inquiry on a key issue makes the assessment order erroneous. As held by the Hon'ble Supreme Court in CIT v. Amitabh Bachchan

B. Arunkumar Capital & Credit Services Pvt Ltd, Mumbai vs. Principal Commissioner of Income Tax 3, Mumbai

In the result the appeal filed by the assessee stands partly\nallowed

ITA 2034/MUM/2025[2020-21]Status: DisposedITAT Mumbai25 Jul 2025AY 2020-21

Section 143(1)Section 143(3)Section 263Section 37(1)Section 80G

case of Sir Dorabji Tata Trust (supra).\n18. We find that the case of the Commissioner hinges on, what he\nperceives as, lack of inquiry, the inadequacy of inquiry, or taking up the\npertinent line of inquiry but not following it to its logical conclusion.\nLearned Departmental Representative has also

Acc Mineral Resources Limited, Mumbai vs. Principle Commissioner of Income Tax, Mumbai-1, Mumbai

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

ITA 2687/MUM/2024[2018-19]Status: DisposedITAT Mumbai24 Jul 2025AY 2018-19

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am Acc Minerals Resources Limited Principal Commissioner Of Income 121, Cement House, Maharshi Karve Tax, Mumbai – 400 001. Vs. Road, Church Gate, Mumbai – 400020. Pan/Gir No. Aaact2214N (Appellant) : (Respondent) Assessee By : Shri Saurabh Soparkar (Virtually Appear) Respondent By : Shri Shekhar L. Gajbhiye, Cit Dr Date Of Hearing : 29.04.2025 Date Of Pronouncement : 24.07.2025 O R D E R Per Kavitha Rajagopal, J M: This Appeal Has Been Filed By The Assessee, Challenging The Order Of The Learned Principal Commissioner Of Income Tax, Mumbai -1 (‘Ld. Pcit’ For Short), Passed U/S.263 Of The Income Tax Act, 1961 (‘The Act'), Pertaining To The Assessment Year (‘A.Y.’ For Short) 2018-19. 2. The Assessee Has Raised The Following Grounds Of Appeal: 1. In Law & In The Facts & Circumstances Of The Appellant'S Case, Impugned Order U/S. 263 Of The Act Passed By Pcit-1, Mumbai Is Bad In Law & Deserves To Be Quashed. 2. In Law & In The Facts & Circumstances Of The Appellant'S Case, The Pcit-1, Mumbai Has Erred In Setting Aside The Assessment Order Dated 20.04.2021 Passed By The Assessing Officer Without Considering The Fact That The Assessing Officer During The Course Of Assessment Proceedings Has Already Gone Through Issue

For Appellant: Shri Saurabh Soparkar (Virtually appear)For Respondent: Shri Shekhar L. Gajbhiye, CIT DR

Section 142(1)Section 143(2)Section 143(3)Section 263Section 35D

Nirav Modi (supra), where it was decided that the jurisdiction u/s. 263 could be invoked by ld. PCIT only when there is a lack of inquiry and not in a case where it was for inadequate inquiry. 11. Pertinently, the ld. PCIT in the impugned order has stated that

Shree Infra, Surat vs. Pr. CIT-1, Surat

In the result, the appeal of the assessee is dismissed

ITA 601/SRT/2024[2018-19]Status: DisposedITAT Surat22 Jul 2025AY 2018-19

Bench: Shri Siddhartha Nautiyal & Shri Bijayananda Pruseth

For Appellant: Shri Suresh K Kabra, CAFor Respondent: Shri Aashish Pophare, CIT DR

Section 143(3)Section 23(1)Section 23(5)Section 263

made by the Assessing Officer, during the course of assessment proceedings. Accordingly, we are of the considered view that there was lack of inquiry by the Assessing Officer on this aspect, at the time of framing of assessment order. Further, with regards to the alternate contention of the Shree Infra

Bhagwati Steel Processors, Chandigarh vs. PCIT, Chandigarh

In the result, the appeal of the Assessee is allowed

ITA 435/CHANDI/2025[2021-22]Status: DisposedITAT Chandigarh15 Jul 2025AY 2021-22

For Appellant: \nShri T.N. Singla, C.AFor Respondent: \nShri Manav Bansal, CIT, DR

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

invoke Section 263.\nΟ Reliance Communications Ltd. [240 Taxman 655 (Bom)] - held that absence of\ndiscussion in the order does not mean lack of inquiry.\nΟ Nirav Modi [390 ITR 292 (Bom)), Shashi Bhushan Gupta [202 TTJ UO 30], Delhi\nAirport Metro Express [398 ITR 8], Fine Jewellery (India

Asian Institute of Gastroenterology Private Limited, Hyderabad vs. DCIT., Circle-1(1), Hyderabad

In the result, appeals filed by the assessee for both the assessment years 2020-2021 and 2021-2022 are allowed

ITA 610/HYD/2025[2021-22]Status: DisposedITAT Hyderabad11 Jul 2025AY 2021-22

Bench: Shri Manjunatha G & Shri Ravish Sood

For Appellant: CA, S. VenugopalFor Respondent: Shri B. Bala Krishna, CIT-DR

Section 143(3)Section 14ASection 263

held as under : “22. Once the Assessing Officer has conducted an inquiry, then the case does not fall in the category of complete lack of inquiry on the part of the Assessing Officer while passing the assessment order and therefore, the order of the Assessing Officer cannot be set aside ... ground of lack of inquiry. It is a settled proposition of law that when the Assessing Officer has conducted an inquiry and accepted the claim of the assessee, then it is not mandatory for the Assessing Officer to give a finding on each and every issue he has undertaken during

Sushil Mitruka, Siliguri vs. P.C.I.T., Siliguri

In the result, appeal of the assessee stands allowed

ITA 490/KOL/2025[2018-2019]Status: DisposedITAT Kolkata10 Jul 2025AY 2018-2019

Bench: Shri Rajesh Kumar, Am& Shri Pradip Kumar Choubey, Jm]

Section 142ASection 143(3)Section 147Section 148Section 263Section 68

Income-tax Act, 1961, merely because he has a different opinion in the matter. It is only in cases of lack of inquiry that such a course of action would be open.” 14. Similarly, the Hon’ble Gujarat High Court in the case of CIT Vs. R. K. Construction

Sushil Mitruka, Siliguri vs. P.C.I.T., Siliguri

In the result, appeal of the assessee stands allowed

ITA 489/KOL/2025[2016-2017]Status: DisposedITAT Kolkata10 Jul 2025AY 2016-2017

Bench: Shri Rajesh Kumar, Am& Shri Pradip Kumar Choubey, Jm]

Section 142ASection 143(3)Section 147Section 148Section 263Section 68

Sushil Mitruka, Siliguri vs. P.C.I.T., Siliguri

In the result, appeal of the assessee stands allowed

ITA 488/KOL/2025[2015-2016]Status: DisposedITAT Kolkata10 Jul 2025AY 2015-2016

Bench: Shri Rajesh Kumar, Am& Shri Pradip Kumar Choubey, Jm]

Section 142ASection 143(3)Section 147Section 148Section 263Section 68

Sushil Mitruka, Siliguri vs. P.C.I.T., Siliguri

In the result, appeal of the assessee stands allowed

ITA 487/KOL/2025[2014-2015]Status: DisposedITAT Kolkata10 Jul 2025AY 2014-2015

Bench: Shri Rajesh Kumar, Am& Shri Pradip Kumar Choubey, Jm]

Section 142ASection 143(3)Section 147Section 148Section 263Section 68

Yogeshkumar Harishbhai Mali, Surat vs. PCIT, Surat-1, Surat

In the result, appeal of the assessee is allowed

ITA 420/SRT/2024[2014-15]Status: DisposedITAT Surat07 Jul 2025AY 2014-15

Bench: Ms Suchitra Raghunath Kamble & Shri Bijayananda Prusethआयकर अपील सं./Ita No.420/Srt/2024 Assessment Year: (2014-15) (Hybrid Hearing) Yogeshkumar Harishbhai Mali, Principal Commissioner Of बनाम/ 117, Khambhati Panchni Waid Income-Tax, Surat-1, Income Tax Vs. Rustompura, Surat - 395002 Office, 123, 1Stfloor, Aaykar Bhavan, Majura Gate, Surat- 395001 स्थायीलेखासं./जीआइआरसं./Pan/Gir No: Abdpm 3296 L (अपीलाथ"/Appellant) (प्र"थ" /Respondent) िनधा"रती की ओर से / Appellant By Shri Sapnesh R Sheth, Ca राज" की ओर से /Respondent By Shri Aashish Pophare, Cit-Dr सुनवाई की तारीख/Date Of Hearing 04/06/2025 उद्घोषणा की तारीख/Date Of Pronouncement 07/07/2025

Section 114BSection 115BSection 147Section 148Section 263Section 69A

impugned issue and added the entire on-money. Considering all these facts, it could not be said that it was the case of “lack of inquiry”. There is a distinction between “lack of inquiry” and “inadequate inquiry”. If there was any inquiry, even inadequate, that could not, by itself, give ... pass order u/s 263 of the Act merely because he has different opinion in the matter. It is only in cases of lack of inquiry that such a course of action could be opened. In the present case, the AO has duly examined the facts and formed an opinion that

Mohd Shahbuddin Khan, Chandigarh vs. PCIT-1, Chandigarh

In the result, appeal of the Assessee is dismissed

ITA 564/CHANDI/2024[2013-2014]Status: DisposedITAT Chandigarh04 Jul 2025AY 2013-2014

For Respondent: \nShri Ajay Jain, CA and Shri Lovesh Bansal, CA

Section 147Section 263

year. The AO's failure to examine these issues renders the\nassessment order erroneous in law.\n7.3 It is a settled principle that “lack of inquiry” or “inadequate inquiry” that\nresults in an incorrect assumption of facts or misapplication of law empowers\nthe Commissioner to invoke Section 263, as held

Bakeri Projects Private Limited, Ahmedabad vs. DCIT Circle 1(1)(1), Ahmedabad

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

ITA 954/AHD/2025[2020-21]Status: DisposedITAT Ahmedabad04 Jul 2025AY 2020-21

Bench: S/Shri Sanjay Garg & Makarand V.Mahadeokarasstt.Year : 2020-21 Bakeri Projects Pvt. Lt. The Dcit, Cir.(1)(1) 1St Floor, Sanskrut Vs. Ahmedabad. Old High Court Road Off: Ashram Road Ahmedabad. Pan : Aagcb 1864 L (Applicant) (Responent)

For Appellant: Shri Deepak Shah, AR, and Shri Bharat Shah, ARFor Respondent: Shri R.P. Rastogi, CIT-DR

Section 142(1)Section 143(3)Section 263Section 80I

material facts and submissions made by the appellant, thereby making the assessment order a result of conscious examination and not a case of lack of inquiry. 6. That the revision order under Section 263 is bad in law since the AO's view was a plausible view, duly supported ... considered this matter under the rectification jurisdiction of section 154 belies the PCIT’s assumption that there was non-application of mind or lack of inquiry. The initiation of section 154 proceedings by the AO is itself a recognition of the fact that the issue is a matter of record

Gujarat Mineral Development Corporation Limited, Khanji Bhavan vs. Pr. Commissioner of Income Tax-1, Aayakar Bhawan(Vejalpur), Ahmedabad

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

ITA 651/AHD/2025[2020-21]Status: DisposedITAT Ahmedabad04 Jul 2025AY 2020-21

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2020-21

For Appellant: Shri Rignesh Das, CIT-DR

Section 143(1)Section 143(3)Section 14ASection 263Section 80GSection 80I

Malabar Industrial Co. Ltd. v. CIT [(2000) 243 ITR 83 (SC)], authoritatively noted 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 263 of the Act, merely because he has a different opinion in the matter. It is only in cases of ‘lack of inquiry’ that such a course of action would be open." 10 17. The Hon’ble High Court further noted that the power under section 263 cannot

Ttec India Customer Solutions Pvt. Ltd., Ahmedabad vs. The Pr.CIT-3, Ahmedabad

In the result, the appeal of the assessee is allowed

ITA 1026/AHD/2025[2020-21]Status: DisposedITAT Ahmedabad04 Jul 2025AY 2020-21

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2020-21 Ttec India Customer Solutions Pr.Commissioner Of Private Limited, Ttec Ahmedabad Vs. Income Tax-3 Opp: L.J.College Vejalpur Off: Sg Road, Makarba Ahmedabad. Fatewadi Bo, Fatewadi Ahmedabad. Pan : Aaccm 1005A (Applicant) (Responent) : Shri Vishal Kabra, Ar Assessee By : Shri Rignesh Das, Cit-Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 03/07/2025 घोषणा क" तारीख /Date Of Pronouncement: 04/07/2025 आदेश आदेश/O R D E R आदेश आदेश

For Appellant: Shri Rignesh Das, CIT-DR

Section 142(1)Section 143(2)Section 143(3)Section 263Section 37(1)Section 80G

that the AO has not elaborated the acceptance in the assessment order is not ipso facto evidence of non-application of mind or lack of inquiry, particularly when the record contains detailed submissions, evidences, and calculations in response to statutory notices. The decision of the Coordinate Bench ... cumulative and not alternative. A mere disagreement with the conclusion drawn by the Assessing Officer, in the absence of any demonstrable error or lack of inquiry, cannot render the order erroneous in law. Similarly, an order cannot be treated as prejudicial merely because it results in lower tax liability, unless

Soham Papers Private Limited, Morbi vs. Pr. CIT, Rajkot-1, Rajkot

ITA 371/RJT/2024[2019-20]Status: DisposedITAT Rajkot30 Jun 2025AY 2019-20

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinha

Section 115BSection 143(3)Section 263Section 69A

that of an independent/impartial adjudicator, the CIT’s supervisory jurisdiction is attracted because the order of the AO would be erroneous for lack of inquiry, that is if he does not investigate or it would be erroneous for failure of AO to adjudicate as an independent/impartial adjudicator which means that ... natural justice, or there is bias or arbitrariness etc. then also the order of AO would be erroneous. When we say that lack of inquiry makes an AO’s order erroneous, one has to keep in ITA No. 312, 322 to 329/Rjt/2024 ITA No. 331 & 335 & 371/Rjt/2024 mind the difference

Shamji Nathu Vaishya, Veraval vs. Pr. CIT, Rajkot-1, Rajkot

ITA 327/RJT/2024[2018-19]Status: DisposedITAT Rajkot30 Jun 2025AY 2018-19

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinha

Section 115BSection 143(3)Section 263Section 69A