Section 263 revision fails where enquiry was made on demonetisation cash deposits and a plausible assessment view was taken.

Revision under section 263 could not be sustained where the assessment record showed enquiry into demonetisation cash deposits, including questionnaires, replies, bank statements and debtor details, and the Assessing Officer accepted the assessee's explanation after considering the material. The absence of an elaborate discussion in the assessment order did not by itself show lack of enquiry or non-application of mind. Since the Assessing Officer had adopted one plausible view on the facts, the assessment was not erroneous and prejudicial to the interests of the Revenue, and the revisionary interference was set aside.

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Issues: Whether the revisionary order under section 263 of the Income-tax Act, 1961 was sustainable when the Assessing Officer had examined the demonetisation cash deposits and accepted the assessee's explanation, and whether the assessment order could be treated as erroneous and prejudicial to the interests of the Revenue on the ground of alleged lack of enquiry and proposed application of section 68.

Analysis: The assessee's case was selected for scrutiny on cash-deposit-related issues, and the Assessing Officer issued questionnaires and obtained replies, including details of debtors, bank statements, and date-wise deposit particulars. The material on record showed that the cash credited during the demonetisation period was explained as deposits made by trade debtors directly into the assessee's bank accounts, and the Assessing Officer did not make any further addition after considering the explanations. The Tribunal held that the record demonstrated enquiry on the very issue on which revision was initiated, and that the absence of a detailed discussion in the assessment order did not establish non-application of mind. Since the Assessing Officer had taken one of the possible views after enquiry, the conditions for invoking section 263 were not satisfied.

Conclusion: The revisionary order under section 263 was not justified, and the assessee succeeded on the merits of the challenge to the revision.

Final Conclusion: The assessment was restored by rejecting the revisionary interference, and the assessee's appeal was allowed.

Ratio Decidendi: Revision under section 263 cannot be sustained where the assessment record shows enquiry on the very issue in dispute and the Assessing Officer has adopted a plausible view after consideration of the material, since an order is not erroneous merely because the Commissioner prefers a different conclusion.

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