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2023 (2) TMI 55 - ITAT HYDERABADRevision u/s 263 - AO did not verify interest income offered and income as per Form 26AS - limited scrutiny case - assessee case was selected for scrutiny through CASS in the limited scrutiny to verify “Large other expenses claimed in the profit & loss A/c and mismatch in sales turnover reported in audit report & ITR” - HELD THAT:- We find in the case of Balvinderkumar [2021 (3) TMI 649 - ITAT DELHI] as quashed the 263 proceedings by holding that in case of limited scrutiny, the Assessing Officer cannot go beyond the reasons for which the matter was selected for limited scrutiny and therefore, it would not be open to pass a revisionary order u/s 263 by the CIT on other aspects. Since the case of the assessee in the instant case was selected for limited scrutiny to verify “Large Other Expense claimed in the Profit & Loss Account and mismatch in sales turnover reported in audit report and ITR” therefore, the Assessing Officer could not have travelled beyond the reasons for which the case was selected for limited scrutiny. Therefore, the order cannot be said to be erroneous. It is the settled proposition of law that for invoking the jurisdiction u/s 263, the twin conditions namely the order is erroneous and the order is prejudicial to the interest of the Revenue must be satisfied. However, the order passed by the Assessing Officer in the instant case cannot be held to be erroneous although the same may be prejudicial to the interest of the Revenue. Thus, the twin conditions are not satisfied. Therefore, we are of the considered opinion that the learned PCIT/CIT could not have initiated proceedings u/s 263 - Appeal filed by the assessee is allowed.
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