Tribunal overturns assessment revision for A.Y. 2011-12 due to lack of jurisdiction.

The Tribunal allowed the Assessee's appeal against the revision of the assessment order under section 263 for A.Y. 2011-12. The Tribunal found the PCIT's decision to disturb the brought forward balances without valid jurisdiction erroneous and quashed the revisionary order. The appeal for the same year was dismissed as infructuous due to the invalidity of the revisionary order, which was deemed void ab initio.

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Issues:
1. Revision of assessment order under section 263 of the Income Tax Act, 1961.
2. Allowance of carry forward losses and unabsorbed depreciation.
3. Validity of revisionary orders passed by the PCIT.

Issue 1: Revision of assessment order under section 263:
The Assessee filed two appeals against the orders of the Pr. Commissioner of Income Tax-1 and the Commissioner of Income Tax (Appeals). The first appeal was against the order passed under section 263 of the Act, which was found erroneous by the PCIT. The PCIT observed that the assessment framed under section 143(3) was prejudicial to the interest of Revenue as the Assessee was not entitled to carry forward business loss and unabsorbed depreciation for the assessment years 2006-07 and 2007-08. The PCIT proposed to revise the assessment order, leading to an appeal by the Assessee challenging the PCIT's decision.

Issue 2: Allowance of carry forward losses and unabsorbed depreciation:
The Assessee contended that it was entitled to carry forward losses and unabsorbed depreciation from the period prior to the demerger under section 72A of the Act and as per the direction of the Hon'ble High Court of Gujarat. The Revenue, however, supported the PCIT's decision. The Tribunal noted that the Assessee came into existence post-demerger and carried forward losses and unabsorbed depreciation in accordance with the High Court's order. The Tribunal held that the PCIT's decision to disturb the brought forward balances without valid jurisdiction was erroneous, and thus quashed the revisionary order under section 263 of the Act.

Issue 3: Validity of revisionary orders passed by the PCIT:
The Tribunal found the revisionary order passed by the PCIT under section 263 of the Act to be invalid and void ab initio. As a result, the consequential order based on the revisionary order was also deemed to have no legal basis. The Tribunal dismissed the appeal filed by the Assessee for the year under consideration as infructuous due to the invalidity of the revisionary order.

In conclusion, the Tribunal allowed the appeal filed by the Assessee against the revision of the assessment order under section 263 for A.Y. 2011-12 and dismissed the appeal for the same year as infructuous due to the invalidity of the revisionary order. The Tribunal held that the PCIT's decision to disturb the brought forward balances without valid jurisdiction was erroneous, leading to the quashing of the revisionary order.

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