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Issues: Whether the Commissioner was justified in invoking revisional jurisdiction under section 263 of the Income-tax Act, 1961 to withdraw deduction under section 10B of the Income-tax Act, 1961 on the ground that the assessee was not a duly approved 100% export oriented undertaking.
Analysis: The assessment had been completed under section 143(3) after consideration of the material placed before the Assessing Officer. The revisional order was founded on the view that approval granted under the STP scheme was not equivalent to approval by the Board contemplated in section 10B and on a later CBDT clarification. However, the same issue had been accepted in the assessee's earlier year and was also covered by co-ordinate Bench reasoning holding that the Commissioner cannot revise an assessment merely because he prefers another view. Where the Assessing Officer has adopted one of the permissible views on the record available before him, and the revision is based on a subsequent clarification and not on any material overlooked by the Assessing Officer, the assumption of jurisdiction under section 263 is not sustainable.
Conclusion: The revision under section 263 was not valid and the deduction under section 10B could not be withdrawn on that basis.
Final Conclusion: The revisional order was set aside and the assessment order was restored, resulting in relief to the assessee.
Ratio Decidendi: Section 263 cannot be invoked on a mere change of opinion where the assessment order is based on one of two possible views and no material error causing prejudice to the revenue is shown.
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