2016 (3) TMI 650 - HC - Income Tax

Validity of revision orders u/s 263 - Held that - t is settled law that the commissioner of Income Tax can exercise his jurisdiction under Section 263 of the Income Tax Act only in cases where no enquiry is made by the Assessing Officer. In the instant case, it is admitted by the Income Tax Department that the Assessing Officer had made some enquiries though according to them it was not a proper enquiry. In our view of the fact that some enquiry was made is sufficient to debar the authorities from exercising the powers under Section 263 of the Income Tax Act.The Tribunal was accordingly justified in setting aside the order passed under Section 263 of the Act - Decided in favour of assessee

Summary

The High Court of Allahabad dismissed the appeal, stating that the Commissioner of Income Tax can only use Section 263 if no enquiry is conducted by the Assessing Officer. In this case, some enquiry was made, so Section 263 powers were not applicable. The Tribunal's decision to set aside the Section 263 order was justified. No substantial question of law arose for consideration.