Section 263 revision fails where the Assessing Officer adopts a plausible, precedent-backed view on provident fund contribution timing.

A revision under section 263 is not justified where the Assessing Officer accepts employees' provident fund contribution paid before the return-filing due date on a legally sustainable view. The ITAT noted that conflicting judicial views existed and that, when two reasonable constructions of a taxing provision are possible, the interpretation favouring the assessee should be adopted. It also stated that an assessment is not erroneous merely because the Commissioner prefers a different interpretation, so long as the Assessing Officer's view is supported by law and precedent. On that basis, the revision was held unsustainable and the addition under section 263 could not be maintained.

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Issues: Whether the revisional order under section 263 was sustainable where the Assessing Officer had accepted the assessee's claim regarding employees' provident fund contribution paid before the due date for filing the return.

Analysis: The disputed addition concerned employees' contribution to provident fund, which had not been deposited within the due date under the provident fund law but was stated to have been paid before the due date for filing the return. The Bench noted that there were judicial views favouring the assessee and that, where two reasonable constructions of a taxing provision are possible, the construction favourable to the assessee must be adopted. It also held that an assessment order is not erroneous when the Assessing Officer adopts a view supported by law and binding or persuasive precedents, and the Commissioner cannot substitute another possible view merely because a different interpretation is preferred. On that basis, the Assessing Officer's view was treated as a plausible view taken in accordance with law.

Conclusion: The revisional order was not sustainable and the addition directed under section 263 could not be maintained; the issue was decided in favour of the assessee.

Ratio Decidendi: Where the Assessing Officer adopts a legally sustainable and plausible view supported by judicial precedent, the assessment cannot be revised under section 263 merely because another view is possible.

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