TaxTMI 
TaxTMI 
2025 (8) TMI 825
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.... of the PCIT was wrong. 3.0 It has been noted that there is a delay of 51 days in the case, in filing of this appeal before the tribunal. In its affidavit the assessee has pleaded that the assessee was exposed to the order u/s 263 dated 28.10.2024 which was linked to passing of order u/s. 154. It is the case of the assessee that around the time there was a change in the management team of the assessee as result of which some additional time was consumed for internal discussion on the fitness of taking the appellate course of action. All these activities contributed to the delay which was neither willful nor wanton. The assessee submitted that there will not be case of any non-compliance now. We have considered the justification put forth by the assessee and we are satisfied with their adequacy. We are also conscious of the fact that no litigant gains by intentionally delaying its own matters. The Ld. DR did not pose any serious objections to the delay. Accordingly, we hereby condone the delay and proceed to adjudicate this appeal. 4.0 Before proceeding further, we would like to place on record the following brief factual matrix of the case narrated by the Ld.Counsel for the a....
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....om house property. 6.0 Per contra, the Ld.DR relied upon the order of lower authorities. It was vehemently argued that as the Ld.AO had not conducted any enquiries and investigation before passing the impugned order u/s 154, the same fell in the category of an order which is erroneous in so far as it is prejudicial to the interest of Revenue and therefore the assumption of jurisdiction u/s 263 of the Act by the PCIT was correct. 7.0 We have heard rival submissions in the light of material available on records. Before proceeding further to be deem it necessary to extract the statutory provisions of section 263 of the Act. "...263. Revision of orders prejudicial to revenue.-(1) The ^1[Principal Commissioner or Commissioner] may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the ^2[Assessing Officer] is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enh....
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....dictional High Court or Supreme Court in the case of the assessee or any other person.] ^2[(2) No order shall be made under sub-section (1) after the expiry of two years from the end of the financial year in which the order sought to be revised was passed.] (3) Notwithstanding anything contained in sub-section (2), an order in revision under this section may be passed at any time in the case of an order which has been passed in consequence of, or to give effect to, any finding or direction contained in an order of the Appellate Tribunal, ^3[National Tax Tribunal,] the High Court or the Supreme Court. Explanation.-In computing the period of limitation for the purposes of sub-section (2), the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 129 and any period during which any proceeding under this section is stayed by an order or injunction of any court shall be excluded...." 8.0 From a perusal of statutory provisions enumerated herein above it is clear that a PCIT is empowered to exercise his revisionary authority qua orders passed by authorities sub-ordinate to him provided the order to be considered for revision mu....
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....e submitted that it had made a request for rectification u/s 154 long back on 27.12.2010. It is the case of the assessee that as there was no action, it filed another request for rectification on 02.07.2018 followed by another reminder dated 19.02.2019. The Ld. Counsel has filed copies of his applications dated 02.07.2018 and 19.02.2019 along with annexure. The assessee has stated that the Board had issued circular no.4 of 2012 dated 20.06.2012 in which it had discussed the issue of disputed arrear demands appearing in the records of Revenue. Apropos to the aforesaid circular some assessing officers had stated that a reconciliation of disputed arrear demand was difficult given the expiry of four years limitation period prescribed u/s 154(7). Consequently, in exercise of powers u/s 119(2)(b) the board allowed the assessing officers to reconcile disputed arrear demands by taking actions including rectifications irrespective of expiry of limitation period prescribed u/s 154(7). Thus, the Ld. Counsel argued that in its case rectification was done by the Ld.AO taking support of above circular. 11.0 Coming to the controversy of the order u/s 154 being erroneous in so far as it is prej....
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....dicial to the interest of the Revenue". An assessing officer can be held guilty of passing an order which is held to be "erroneous in so far as it is prejudicial to the interest of the Revenue" provided he fails to do enquiries or verification before passing an order. In the instant case, section 154 does not empowers to hold any enquiries or verification before passing an order and therefore explanation-2 to section 263 cannot be invoked. An assessing officer cannot be held accountable for not holding any verification or enquiries which he was not otherwise statutorily empowered or mandated to conduct. 13.0 We have also noted that there is yet another peculiar facet of the controversy which makes the order u/s. 263 questionable and thus bereft of any merit. The Ld. PCIT in para 9 of his impugned order has held as under: "09. In view of the aforesaid discussion, the rectification order passed under section 154 dated 02.06.2022 by the Assessing Officer for the assessment year 2009-10 is considered to be erroneous and prejudicial to the interests of revenue, within the meaning of Sec.263 of the I.T.Act, 1961. The same is hence partly set aside, with the direction to the A....