https://www.taxtmi.com/caselaws?id=451178 The dominant issue was whether the PCIT validly assumed revisionary jurisdiction under s.263 to set aside an assessment that accepted unsecured loan transactions allegedly routed through entry-operator shell entities. The HC held the assessment order was "erroneous and prejudicial to the interests of the Revenue" because it contained no discussion or verification of the loans' genuineness and creditworthiness despite adverse investigation material, and such matters cannot be concluded merely from ledgers/returns when the lenders' identities are suspect; deeper scrutiny is required. Consequently, s.263 invocation was upheld and the tribunal's finding that adequate inquiry was made was reversed. The HC further held Explanation 2(a) to s.263 (deeming lack of inquiry as error) applied to AY 2016-17, answering the questions in favour of the Revenue. en-us Tue, 19 Mar 2024 00:00:00 +0530 Tue, 23 Dec 2025 10:30:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=451178 The dominant issue was whether the PCIT validly assumed revisionary jurisdiction under s.263 to set aside an assessment that accepted unsecured loan transactions allegedly routed through entry-operator shell entities. The HC held the assessment order was "erroneous and prejudicial to the interests of the Revenue" because it contained no discussion or verification of the loans' genuineness and creditworthiness despite adverse investigation material, and such matters cannot be concluded merely from ledgers/returns when the lenders' identities are suspect; deeper scrutiny is required. Consequently, s.263 invocation was upheld and the tribunal's finding that adequate inquiry was made was reversed. The HC further held Explanation 2(a) to s.263 (deeming lack of inquiry as error) applied to AY 2016-17, answering the questions in favour of the Revenue. Case-Laws Income Tax Tue, 19 Mar 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=451178