Section 263 revision quashed where property capital gains were already assessed in an earlier year and section 50C did not alter liability.

Revision under section 263 could not be sustained where the capital gain from transfer of property had already been disclosed and assessed in an earlier year under section 143(3). The later registration of the sale deed did not create a fresh taxable event for the same transaction, so the assessment for the year under revision was not erroneous or prejudicial to the Revenue. Section 50C also did not justify revisional action on these facts, as the stamp duty valuation would not alter the taxable position for the relevant year. The revisionary order was therefore quashed.

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Issues: Whether the revisionary order under section 263 was valid where the capital gain from transfer of property had already been offered and assessed in an earlier assessment year, and whether section 50C could be invoked in the assessee-trust's case for the relevant year.

Analysis: The assessee trust had already disclosed the transfer and computed capital gain in the earlier year, and that assessment had been accepted under section 143(3). In the relevant year, the registration of the sale deed did not create a fresh taxable event so as to justify revisional action on the same transaction. The assessment for the year under revision, therefore, did not suffer from any error causing prejudice to the Revenue on account of alleged non-application of section 50C. On the facts, the stamp duty valuation would not alter the taxable position for the year under consideration, and the order under revision could not be sustained.

Conclusion: The revision under section 263 was unjustified and was quashed, in favour of the assessee.

Ratio Decidendi: Revision under section 263 cannot be sustained where the alleged tax effect arises from a transaction already assessed and accepted in an earlier year, and the impugned year's order is neither erroneous nor prejudicial to the interests of the Revenue.

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