Revision under section 263 is not to set aside merely unfavourable orders and bring to tax some more money to the treasury-ITAT

In a recent judgment, ITAT Delhi has interpreted the objective and scope of invoking revisionary powers of Commissioner of Income Tax (CIT) under section 263 of the Income Tax Act, 1961 as under:

  1. The provisions of section 263 cannot be invoked to correct each and every type of mistake or error committed by the AO.
  2. The ambit of interference under section 263 is not to set aside merely unfavourable orders and bring to tax some more money to the treasury.
  3. The section is not enacted to get a sheer escapement of revenue which is taken care of in other provisions of the Act.
  4. Prejudice that is contemplated under section 263 is the prejudice to the income-tax administration as a whole.
  5. Section 263 is to be invoked not as a jurisdictional corrective or as a review of a subordinate’s order in exercise of the supervisory power.
  6. Section 263 is to be invoked and employed only for setting right distortions and prejudices to the revenue, which is a unique conception, which is to be understood in the context of and in the interests of the Revenue administration. 

Case Law Details:
I.T.A .No.-3007/Del/2014 ASSESSMENT YEAR-2009-10
Modicare Limited vs CIT
date of Judgment: 19/04/2016

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