Section 263 revision fails where CSR expenditure under section 80G is a debatable deduction and the assessment view is plausible.

Revision under section 263 was held unsustainable where the Assessing Officer had adopted a plausible view on the assessee's CSR-related claim for deduction under section 80G. The issue was treated as highly debatable, with coordinate bench decisions recognising that CSR expenditure could qualify under section 80G. In that setting, the original assessment under section 143(3) was not regarded as erroneous or prejudicial merely because a different view was possible. The revisionary action was therefore characterised as a change of opinion and could not be maintained, and the assessment order was restored.

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Issues: Whether revision under section 263 of the Income-tax Act, 1961 was validly assumed in respect of the assessee's claim relating to CSR expenditure claimed as deduction under section 80G of the Income-tax Act, 1961.

Analysis: The issue was found to be highly debatable, with coordinate bench decisions recognising that CSR expenditure could be claimed under section 80G of the Income-tax Act, 1961. In such circumstances, the assessment view adopted under section 143(3) of the Income-tax Act, 1961 was treated as a plausible view. The revisionary action under section 263 of the Income-tax Act, 1961 was therefore treated as a change of opinion and could not be sustained.

Conclusion: Revision under section 263 of the Income-tax Act, 1961 was invalid and the order of the Assessing Officer was restored; the assessee succeeded.

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