Section 263 revision requires both assessment error and demonstrated Revenue prejudice; absence of either renders revision invalid.

Revisionary jurisdiction under Section 263 requires independent satisfaction that the assessment order is both erroneous and prejudicial to the interests of the Revenue. The notes state that the Tribunal found no error in the original assessment order and that the revisional order did not independently establish prejudice to the Revenue. On that basis, the revision was described as invalid and the issue as resolved in favour of the assessee.

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Issues: Whether revision of the assessment order under Section 263 was valid where the assessment order was not erroneous and no independent finding established prejudice to the interests of the Revenue.

Analysis: Exercise of revisionary jurisdiction requires independent satisfaction of the twin conditions that the assessment order is erroneous and that it is prejudicial to the interests of the Revenue. The Tribunal found no error in the original assessment order. The revisional order also contained no independent finding showing prejudice to the Revenue.

Conclusion: The revision under Section 263 was invalid; the issue is decided in favour of the assessee.

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