2026 (9) TMI 933

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....961 (hereinafter referred to as 'the Act' in short) for Assessment Year 2022-23. 2. The Assessee has raised following grounds of Appeal:- "1. The Learned PCIT (Central), Ahmedabad, erred in law and on the facts in considering the assessment order dated 23.03.2024 passed by the Learned AO under section 143(3) of the Income Tax Act, 1961, as erroneous insofar as it was prejudicial to the interests of the Revenue. It is submitted that in the facts and circumstances of the case, the order passed by the Learned PCIT (Central), Ahmedabad, u/s. 263 of the Income Tax Act, 1961, may please be quashed. 2. The Learned PCIT (Central), Ahmedabad, erred in law and on the facts of the case in assuming jurisdiction under section 263 of....

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.... submitted that the impugned order passed under section 263 of the Income-tax Act, 1961, deserves to be quashed. 5. The Learned PCIT (Central), Ahmedabad, erred in law and on the facts of the case in exercising powers under section 263 of the Income-tax Act, 1961 for directing to levy of penalty under section 271D of the Act, although such power is beyond the scope of revisionary jurisdiction under section 263 and, in any case, the statutory jurisdiction to levy penalty under section 271D is discretionary and vested only in the Joint Commissioner of Income Tax and not with the Principal Commissioner of Income Tax. It is therefore submitted that the impugned order passed under section 263 of the Income-tax Act, 1961, deserves to be ....

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....he issue is squarely covered by the judgment of the Hon'ble jurisdictional Gujarat High Court in the case of Dilip Patel vs. PCIT, Central, reported as (2026) 186 taxmann.com 165 (Gujarat). 5. Per contra, the Ld. CIT-DR supported the order of Ld. PCIT. 6. We have heard the parties and perused the material on record. The only controversy in this case is whether the failure of the AO to initiate penalty proceedings u/s 271D of the Act will make the order liable for revision u/s 263 of the Act. As rightly pointed out by the Ld. AR, the said issue is no longer res integra. The Hon'ble jurisdictional Gujarat High Court in the case of Dilip Patel (supra) held as under: "5.5 With regard to the observations recorded by the Commission....