Section 263 revisional orders need prior hearing; expired limitation bars remand and cannot revive jurisdiction.

A revisionary order under section 263 must be preceded by a show-cause notice and a real opportunity of hearing; otherwise it suffers from jurisdictional infirmity and cannot be sustained. The text further states that where the statutory limitation under section 263(2) has already expired, the defect cannot be cured by remand for fresh consideration, because that would effectively revive or extend a limitation period the statute does not permit to be extended. On that reasoning, the revisional order was quashed and the assessee succeeded.

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Issues: Whether a revisionary order under section 263 of the Income-tax Act, 1961 is valid when no show-cause notice or opportunity of hearing was granted before its passing, and whether the matter could be remitted for fresh consideration after expiry of the statutory limitation under section 263(2).

Analysis: The order under section 263 was passed without issuing a show-cause notice and without affording any hearing to the assessee, despite the statutory requirement of giving a full opportunity before finalising the revisional decision. The statutory outer limit under section 263(2) had already expired on the date of the order, and remanding the matter for a fresh order would have the effect of extending a limitation period that the statute does not permit to be extended. The revisional order therefore suffered from a jurisdictional infirmity and could not be sustained.

Conclusion: The revisionary order was quashed and the assessee succeeded.

Ratio Decidendi: A revisional order under section 263 cannot be sustained if passed without the mandatory pre-decisional opportunity of hearing, and once the statutory limitation under section 263(2) has expired, the defect cannot be cured by remand so as to revive or extend the barred jurisdiction.

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