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2023 (1) TMI 1400 - AT - Income TaxRevision u/s 263 - Addition of bogus purchases - assessee case having been settled under DTVSV Direct Tax Vivad Se Vishwas Act - HELD THAT - CIT had initiated revisional proceedings u/s.263 of the Act after certificate in Form 5 under the Direct Tax Vivad Se Vishwas Act was issued to the assessee by the appropriate authority, therefore, respectfully following case of ase of Pavan Kankur 2022 (11) TMI 1312 - ITAT BENGALURU we quash the order passed by the Pr. CIT u/s.263 - When the assessee had opted for the impugned assessment order passed u/s.143(3) under the Direct Tax Vivad Se Vishwas Act, therefore, the Pr. CIT could not have thereafter stepped in and disturbed such settled matter by initiating proceedings u/s.263 - Decided in favour of assessee.
Issues Involved:
1. Legality of invoking Section 263 of the Income Tax Act. 2. Impact of the Direct Tax Vivad Se Vishwas Act (DTVSV) on Section 263 proceedings. 3. Validity of the revision order passed by the Pr. CIT. Issue-wise Detailed Analysis: 1. Legality of Invoking Section 263 of the Income Tax Act: The assessee contested the invocation of Section 263 by the Pr. CIT, arguing that the assessment order passed under Section 143(3) was neither erroneous nor prejudicial to the interest of the Revenue. The Pr. CIT had set aside the assessment order for fresh enquiry, which the assessee claimed was unsustainable and passed without proper appreciation of facts and evidence on record. 2. Impact of the Direct Tax Vivad Se Vishwas Act (DTVSV) on Section 263 Proceedings: The assessee had opted for the Direct Tax Vivad Se Vishwas Act and received Form 5, indicating the settlement of the dispute. The Pr. CIT, despite being aware of this settlement, initiated proceedings under Section 263. The Tribunal found that once the assessee had opted for the DTVSV and the issue was settled, the Pr. CIT had no jurisdiction to revise the order under Section 263. This view was supported by judicial precedents, including the ITAT Bangalore decision in Pavan Kankur Vs. Pr. CIT and the Hon'ble Madras High Court judgment in Gopalkrishnan Rajkumar Vs. Pr. CIT. 3. Validity of the Revision Order Passed by the Pr. CIT: The Tribunal noted that the Pr. CIT had initiated Section 263 proceedings after the issuance of Form 5 under the DTVSV, which was inappropriate. The Tribunal emphasized that the intention of the DTVSV was to bring closure to disputes and reduce litigation. Thus, the revision order by the Pr. CIT was quashed, and the appeal was allowed in favor of the assessee. Conclusion: The Tribunal concluded that the Pr. CIT was not justified in initiating proceedings under Section 263 once the assessee had opted for the DTVSV scheme. The revision order dated 23.02.2022 was quashed, and the appeal was allowed. No costs were ordered. Order Pronouncement: The order was pronounced under rule 34(4) of the Appellate Tribunal Rules, 1963, by placing the details on the notice board.
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