Assessment order void ab initio; revision under section 263 denied by Tribunal.

The Tribunal ruled in favor of the assessee, holding that an assessment order lacking legal effect cannot be revised under section 263 of the Income Tax Act. The incorrect framing of the assessment order under section 143(3) instead of section 153A rendered it void ab initio, leading to the quashing of the revisional order by the PCIT.

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Issues:
Challenge to jurisdiction under section 263 of the Income Tax Act, 1961 and revisional order passed by the Principal Commissioner of Income Tax, Raipur. Assessment under section 143(3) for AY 2017-18 based on cash seizure during Municipal Elections in Vidarbha.

Analysis:
The appeal was filed against the Principal Commissioner of Income Tax's order under section 263 of the Income Tax Act, seeking to set aside the assessment order passed by the Assessing Officer for AY 2017-18. The assessee challenged the jurisdiction assumed by the PCIT under section 263 and the revisional order. The case involved cash seizure during Municipal Elections in Vidarbha, where cash was seized from the assessee without satisfactory explanations. The assessment under section 143(3) was completed, and later, the PCIT sought to tax the surrendered amount under section 115BBE, leading to the revisional order.

The assessee contended that the assessment order under section 143(3) was void ab initio as it should have been completed under section 153A due to the cash seizure under section 132A. The assessment order was time-barred and lacked jurisdiction, rendering it null and void. The assessee argued that the PCIT misdirected himself in revising an illegal assessment order. The Revenue defended the PCIT's action, but the Tribunal found merit in the assessee's argument.

The Tribunal agreed with the assessee, stating that an assessment order that is null and void cannot be revised under section 263 of the Act. The assessment order, made under section 143(3) instead of section 153A following the cash seizure under section 132A, was against the Act's scheme and unsustainable. Citing legal precedents, the Tribunal held that the assessment order, being void ab initio, could not be subject to revision. Consequently, the revisional order was quashed and set aside, and the appeal of the assessee was allowed.

In conclusion, the Tribunal ruled in favor of the assessee, emphasizing that an assessment order lacking legal effect cannot be revised under section 263 of the Income Tax Act. The incorrect framing of the assessment order under section 143(3) instead of section 153A rendered it void ab initio, leading to the quashing of the revisional order by the PCIT.

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