Record [section 263(1)]

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....ng Officer" and, therefore, is not relevant for the purpose of this case. By the Finance Act, 1988, the said Explanation was substituted with effect from June 1, 1988. The reason why the Legislature had to make that amendment is stated in the Memorandum Explaining the Provisions in the Finance Bill of 1988. We will refer to only that part which is relevant for us. It was observed by the Legis....

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....isions in the three Direct Tax Acts, it is proposed to clarify the legal position in this regard in the Explanation to the relevant sections. The proposed amendments are intended to make it clear that 'record' would include all records relating to any proceedings under the concerned direct tax laws available at the time of examination by the Commissioner." The relevant part of the E....

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..... Under the existing provisions of section 263 of the Income-tax Act and corresponding provisions of the Wealth-tax Act and the Gift-tax Act, the Commissioner of Income-tax is empowered to call for and examine the record of any proceeding and if he considers that the order passed by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of Revenue, he may pass such orde....

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....e always been in existence. Some appellate authorities have, however, decided that the Explanation will apply only prospectively, i.e., only to those orders which are passed by the Commissioner after June 1, 1988. Such an interpretation is against the legislative intent and it is, therefore, proposed to amend section 263 of the Income-tax Act, so as to clarify that the provisions of the Explanatio....