ITAT quashes a Section 263 revision order, reinforcing that adequate inquiries by the AO cannot be overruled based on mere preferences for additional verification.
Section 263 Revision Invalid After Proper Inquiry by AO
The ITAT has held that simply expressing a preference for further verification does not suffice to invoke Section 263 when the Assessing Officer (AO) has conducted a thorough inquiry. The Tribunal emphasizes the distinction between inadequate inquiry and proper inquiry.
Since the AO had already examined the evidence, the Tribunal quashed the revisionary order, reaffirming crucial standards for tax administration.
This ruling serves as a vital reminder for tax practitioners to thoroughly document inquiries conducted, empowering them to safeguard against unwarranted Section 263 actions by revenue authorities.
Citations
- ITAT Order (2026)
