Law:

Section:

Section 263 of the Income-tax Act, 1961 - Revision - Of orders prejudicial to interest of revenue Mere objection and merely because a different view could be taken, are not enough to say that order of Assessing Officer was erroneous or prejudicial to interest of revenue Mere audit objection and merely because a different view could be taken, are not enough to say that the order of the Assessing Officer was erroneous or prejudicial to the interest of the revenue. The jurisdiction could be exercised if the Commissioner audit is satisfied that the basis for exercise of jurisdiction existed. No rigid rule could be laid down about the situation when the jurisdiction can be exercised. Whether satisfaction of the Commissioner for exercising jurisdiction is called for or not, has to be decided having regard to a given fact situation. Where out of the sale consideration for the sale of machinery the assessee had shown a sum of Rs. 1 lakh on account of sale of permit from the Textile Commissioner in respect of 1200 spindles and marked the same as the amount receivable on account of goodwill, and the Assessing Officer had accepted the assessee's case it could not be said that the assessment order was erroneous and prejudicial to the interests of revenue and the Commissioner, on the strength of the audit note and basis of proforma for proposal under section 263 made by the ITO, was not justified in revising the assessment order. JUDGMENT The following question of law has been referred for opinion of this court by the Income-tax Appellate Tribunal, Chandigarh Bench, Chandigarh, arising out of its order dated April 8, 1983, in ITA No. 1076/Asr/1979, in respect of the assessment year 1975-76: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in annulling the order passed by the Commissioner of Income-tax under section 263 of the Income-tax Act, 1961?" The facts noticed by the Tribunal in the statement of case are that: "The assessee held certain machinery and was in possession of a permit obtained from the Textile Commissioner for the working of 1,200 spindles for the manufacture of woollen worsted yam. The said 1,200 spindles were a…

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