Revision under section 263 was examined regarding additions for...

Revision under section 263 was examined regarding additions for allegedly unexplained purchases/sales and allied issues. Where the seller's sales had already been accepted/settled in first appeal, the same transactions could not be treated as unexplained in the purchaser's hands, and the revisional direction could not nullify the CIT(A)'s finding; section 263 jurisdiction was held improperly exercised to that extent. However, for purchases from another supplier whose sales were not shown to have been accepted and where the AO had made a bogus sales addition after PMGKY surrender, the AO's enquiry was held incomplete, justifying set-aside for de novo consideration. The unexplained difference between audited P&L profit and computed income also warranted de novo examination, and audit-objection-based initiation was upheld. Appeal partly allowed. - ITAT

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