IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, BANGALORE BEFORE SHRI NARENDER KUMAR CHODHRY, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA No.915 /Bang/2024 Assessment Year: 2016-17 Anilkumar Anthony Krishna Murthy, Vs. The Pr. Commissioner of No.315, Anil Farm, Bogadi Gaddige Income Tax (Central), Road, Maratikyathana Halli, Bengaluru.

Jayapura Halli, Jayapura Hobli, Bengaluru – 570 026.

PAN – AFKPK 4793 H APPELLANT RESPONDENT Assessee by : Shri Ravishankar SV, Advocate Revenue by : Shri Shivanand H Kalakeri, CIT (DR)

Date of hearing : 05.08.2025 Date of Pronouncement : 09.10.2025

O R D E R

PER WASEEM AHMED, ACCOUNTANT MEMBER:

This appeal is directed against the order passed by the ld.

Principal Commissioner of Income Tax under section 263 of the Income Tax Act, 1961 for the assessment year 2016-17 holding the assessment as erroneous in so far prejudicial to the interest of Revenue.

2. The Principal Commissioner examined the assessment records. He found that the Assessing Officer had not properly verified certain issues. He received a proposal from the Assessing Officer pointing out the errors in the assessment. Based on this proposal, the Commissioner issued a notice under section 263 of the Act. He held that the assessment order was erroneous and prejudicial to the interest of the Revenue. He set aside the assessment with a direction to the Assessing Officer to make a fresh order.

3. The learned Authorised Representative submitted that the initiation of revisionary proceedings itself is bad in law. He pointed out that on page 3 of the Commissioner’s order it is clearly mentioned that the proceedings were started on the basis of a proposal of the Assessing Officer. Section 263 of the Act requires the Commissioner to apply his own mind to the record and form his own satisfaction that the order is erroneous and prejudicial to the Revenue. He cannot rely only on a proposal from the Assessing Officer.

4. On the other hand, the learned Departmental Representative supported the order of the ld. Commissioner passed under section 263 of the Act. He argued that the Commissioner has the power under section 263 to call for and examine the records of any proceedings. The proposal from the Assessing Officer is only an information or input. Once the record comes before the Commissioner, he has to examine it and take a decision. The ld. DR submitted that the Commissioner has considered the record, issued a show cause notice and given opportunity of hearing to the assessee. Therefore, the order cannot be cancelled only because it started from a letter of the Assessing Officer.

4.1 The ld. DR placed reliance on the decision of the ITAT Delhi Bench in Apollo Tyres Ltd. v. ACIT (1998) 61 TTJ 365, where it was held that a proposal from the Assessing Officer does not invalidate the revision proceedings. The DR argued that the ld. Commissioner has given reasons in his order and acted within his jurisdiction.

5. We have carefully considered the order of the ld. Commissioner passed under section 263 of the Act, the arguments of the learned AR and the submissions of the learned DR. It is admitted that the initiation of proceedings under section 263 was at the behest of the Assessing Officer. The Commissioner himself has noted this fact in his order. The same is reproduced as under:

“A proposal was received in this office accordingly from the AO”

5.1 The law is clear that jurisdiction under section 263 must rest on the satisfaction of the ld. Commissioner. He must call for and examine the record on his own and form an independent opinion. This principle has been laid down by the Hon’ble HIGH COURT OF CALCUTTA in the case of Principal Commissioner of Income-tax v. Reeta Lakhmani reported in 45 taxmann.com 590 wherein it was held as under:

8. This aspect was considered by the learned Tribunal and after going through the facts of the case it was found that the initiation of the proceedings under section 263 of the Act was based on a proposal given b