Assessment order under section 153A with prior section 153D approval cannot be revised under section 263 unless approval held erroneous and prejudicial to revenue.

ORDER

PER AMITABH SHUKLA, AM,

These two appeals filed by the assessee are against orders both dated 31.03.2024 of learned Principal Commissioner of Income Tax, New Delhi, [hereinafter referred to as ‘ld. PCIT] passed under section 263 of the Income Tax Act, 1961 pertaining to Assessment Year and 2013-14 and 2014-15. The word ‘Act’ herein this order would mean Income Tax Act, 1961.

2. As both the appeals are on the commons issue of exercise of revisionary authority under section 263 of the Act by the PCIT, for the purposes of convenience both the appeals were heard together and are being adjudicated by this common order. Since, facts are identical, decision taken in ITA No.1546/Del/2025 shall apply mutatis mutandis in ITA No.1548/Del/2025.

3. At the outset, we have noted that the Registry had identified delay of 286 days in filing of appeal for AY 2013-14. Explaining reasons for the delay, it has been submitted that the revisionary order was received on e-mail and the attendant staff was on a sick leave as a result of which the order could not be timely acted upon. The ld. Counsel pleaded that the delay be condoned. The ld. DR objected to the condonation of the delay. We are conscious that no litigant benefits by delaying its matters. Accordingly, we proceed to condone the delay and adjudicate this appeal, subject to payment of Rs.5,000/- by the assessee within one month of the receipt of this order to the Prime Minister Relief Fund. A receipt of the payment shall be made available to the ld. AO within one week of its payment.

4. The grounds of appeal raised in ITA No.1546/Del/2025 are as under:-

1. For that on the facts and in the circumstances of the case, the order passed by the Ld. Principal CIT u/s 263 of the Act is bad in law and is liable to be quashed.

2. For that the Ld. PCIT was not justified in holding that the assessment order passed u/s. 153A dated 17.11.2021 is erroneous and prejudicial to the interest of the revenue though the A.O. had completed the assessment after due enquiries and application of mind and no prejudice was caused to the revenue.

3. The Ld. PCIT failed to appreciate that the alleged transactions in connection with Gold Account as reflected in the seized documents were not relating to the A.Y.: 2013-2014.

4. Without prejudice to the above, the Ld. PCIT ought to have considered that the income earned from On-Money, which was added back by the A.O. during the course of assessment proceedings u/s. 153A, was invested in gold and, as such, no separate addition was called for.

5. The grounds of appeal raised in ITA No.1548/Del/2025 are as under:-

1. For that on the facts and in the circumstances of the case, the order passed by the Ld. Principal CIT u/s 263 of the Act is bad in law and is liable to be quashed.

2. For that the Ld. PCIT was not justified in holding that the assessment order passed u/s. 153A dated 17.11.2021 is erroneous and prejudicial to the interest of the revenue though the A.O. had completed the assessment after due enquiries and application of mind and no prejudice was caused to the revenue.

3. For that on the facts and in the circumstances of the case, the Ld. PCIT was not justified in directing the A.O to carry out thorough and detailed enquiries on the issue of undisclosed investment in gold of Rs. 13,91,26,000/-.

6. The assessee has also raised additional ground of appeal challenging exercise of revisionary authority u/s 263 by the Ld. PCIT. It has been contested that as the order u/s 153A dated 17.11.2021 was passed with the approval of JCIT, Central Range-8, the ld. PCIT, was ousted of his jurisdiction under section 263 to exercise any revisionary au