Law:

Section:

Section 263 read with section 69 of the Income-tax Act, 1961 - Revision - Of orders prejudicial to interest of revenue - Assessment year 1993-94 - Subsequent to completion of assessment under section 143(3)/148 by Assessing Officer, Commissioner invoked section 263 and held that opening balance in assessee's capital account as on 1-4-1992 represented assessee's income from undisclosed sources and was liable to tax in assessment year 1993-94 in absence of any proof regarding its accommodation in earlier years - Tribunal found that genuineness of said amount had already been adjudicated upon by assessing authority for appropriate financial year relevant to assessment year 1992-93 - Tribunal quashed order of Co mmissioner passed under section 263 - Whether there was any illegality in Tribunal's order - Held, no FACTS Subsequent to completion of assessment under section 143(3)/148 by the Assessing Officer, the Commissioner invoked section 263 and held that the opening balance in the assessee's capital account as on 1-4-1992 represented the assessee's income from undisclosed sources and was liable to tax in the assessment year 1993-94 in the absence of any proof regarding its accommodation in the earlier years. On appeal, the Tribunal held that it was a case of unexplained investment under section 69 and appropriate previous year for inclusion was the relevant financial year and, therefore, the opening capital could not be added as an unexplained investment under section 69 for the assessment year 1993-94. The Tribunal also held that the genuineness of the capital introduction had already been adjudicated upon by the assessing authority for the appropriate financial year relevant to assessment year 1992-93. Therefore, the order of the Assessing Officer did not suffer from any error and was not prejudicial to the interest of the revenue. The Tribunal also observed that the order passed by the assessing authority for the assessment year 1993-94 on the basis of the notice under section 148 had already been quashed by the order of the Tribunal dated 6-12-2001 and ultimately held that the order passed by the Commissioner under section 263 was to be quashed. On appeal :…

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