ITAT Mumbai held that once a Section 263 revision order is quashed, the consequential assessment cannot survive.
Consequential Assessment Falls With Quashed Section 263 Order
The ITAT Mumbai held that where a Section 263 revision order is quashed, the subsequent assessment order passed pursuant to that revision automatically falls, as it derives jurisdiction solely from the revision.
The tribunal dismissed the Revenue’s appeal, stating that without a valid Section 263 order, the Assessing Officer lacks authority to reassess. A fresh assessment must be initiated independently, if warranted.
This principle ensures legal coherence in revision and assessment hierarchy. It prevents revival of assessments based on defunct revision orders. Practitioners should promptly challenge consequential assessments where the root revision is legally defective.
Citations
- Section 263, Income Tax Act
