INCOME TAX ACT, 1961

Section 263

Revision under section 263 - Erroneous and prejudicial order - No conclusive finding even recorded by Pr.CIT about allowance of assessee's claim being against the law -

Pr.CIT invoked jurisdiction under section 263 as regards issue of allowability of deduction under section 54F in respect of agricultural land acquired by assessee and used for construction of house. He remanded the matter to AO for passing a fresh order. Held: There was no allegation by Pr.CIT about lack of enquiry on part of AO while passing assessment order. Even otherwise, it was clear from the assessment order that case was selected for limited scrutiny only on the issue of investment made in agricultural land and deduction under section 54F. Even Pr.CIT himself was not sure about correctness of the claim and remanded the matter to AO for passing a fresh order. Hence, he had not given a concluding finding as to whether order of AO allowing the claim of deduction under section 54F after conducting an enquiry was absolutely against the provisions of law. Once issue of allowability of deduction under section 54F was a debatable issue and AO had taken a possible view, then Pr.CIT was not permitted to invoke the provisions of section 263 merely because he did not agree with view taken by AO.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2015-16

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