IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE DR. B.R.R. KUMAR, VICE-PRESIDENT MS. SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A. No. 579/SRT/2025 (Assessment Year: 2021-22)

Sunil Kumar Baheti, Principal Commissioner of Vs.

1009-10, New Textile Market, Income-tax (Central), Ring Road, Surat-395002 Surat [PAN : AIYPB 2308 J]

(Appellant) .. (Respondent Appellant represented by : Shri Ramesh Malpani, CA Respondent represented by: Shri Mukesh Jain, CIT (DR)

Date of Hearing 22.01.2026 Date of Pronouncement 17.02.2026

O R D E R

PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-

This appeal filed by the assessee is directed against the order passed by the learned Principal Commissioner of Income-Tax (Central), Surat [herein-after referred to as “PCIT”] dated 31.03.2025, in exercise of revisionary powers under Section 263 of the Income-tax Act, 1961 [hereinafter referred to as “the Act”], for the Assessment Year (AY) 2021-22.

2. The assessee has raised the following grounds of appeal:

“1. That on the facts and in the circumstances of the case as well as in law, the order passed by ld. Principal Commissioner of Income Tax (Central), Surat (PCIT) u/s. 263 of the I. T. Act, 1961 ("the Act") is wrong and unjustified because there has been no error so as to be prejudicial to the interest of revenue in the assessment order passed u/s 143(3) of the Act and Id. PCIT has passed the said order u/s 263 just by taking a different possible view and incorrect view. Appellant prays for quashing the order so passed by ld. PCIT, which is contrary to the settled law.

And other grounds….”

3. The brief facts of the case are that the assessee filed his return of income for AY 2021-22 on 17.02.2022 declaring total income of Rs.57,46,649/-. The case was selected for scrutiny and assessment was completed under section 143(3) of the Act on 30.03.2023 accepting the returned income. Subsequently, the Ld. PCIT examined the assessment records and issued show-cause notices dated 07.03.2025 and 28.03.2025 proposing revision u/s 263 of the Act on two issues:

(i) Alleged unexplained cash investment of Rs.27,87,450/- for purchase of shop No. 547 based on seized documents found during search.

(ii) Non-taxation of deemed rental income from four immovable properties shown in the balance sheet, i.e. Avadh Markey Shop, Flat, Shop Raj Textile Tower and Shop at Raj Tower.

4. After considering the assessee’s replies, the Ld. PCIT passed the impugned order setting aside the assessment and directing the Assessing Officer to pass a fresh assessment after proper verification.

5. Aggrieved by the order of the Ld. PCIT, the assessee is in appeal before the Tribunal.

6. Before us, the Ld. AR submitted that, during the assessment proceedings, the Assessing Officer issued a specific notice under section 142(1) dated 21.09.2022 calling upon the assessee to explain the alleged cash payment of Rs.27,87,450/- for purchase of shop No. 547. The assessee categorically denied having purchased any such shop or having made any payment and this reply was duly filed and acknowledged. The Ld. AR further submitted that the Assessing Officer, after examining the explanation and in absence of any corroborative evidence linking the assessee with the alleged purchase, accepted the explanation and completed the assessment. The Ld. AR, therefore, contended that the issue was subject to due enquiry and application of mind by the Assessing Officer, and revision u/s 263 amounts to mere change of opinion. As regards house property income, the Ld. AR submitted that the properties were either used for business purposes, self-occupation, or the possession had not been received during the relevant year. These facts were verifiable from records already available with the Assessing Officer. The Ld. AR relied on the decision of the Hon’ble Supreme Court in the case of PCIT vs. Shreeji Prints (P.) Ltd., [2021] 130 taxmann.com 294, affirming the Gujarat High Court decision, wherein it was held that section 263 cannot be invoked mere