Revision : S. 263 of Income-tax Act, 1961 Limitation : A.Y. 2004-05 : Reopening of assessment on certain items and reassessment completed : Revision in respect of other items u/s.263 : Period of limitation to be counted from the original assessment.

“(i) While seeking to exercise his jurisdiction u/s. 263, the Commissioner did not find any error in the order of reassessment dated 27-12-2007 as regards the disallowance of the assessee’s claim on the basis of the provisions of S. 72A. The impugned notice adverted to issues which, as a matter of fact, did not form either the subject-matter of the notice that was issued u/s.148 on 6-3-2007, nor the order of reassessment thereupon which was passed on 27-12-2007. The jurisdiction u/s.263 was sought to be exercised with reference to issues which were unrelated to the grounds on which the original assessment was reopened and reassessment was made.

(ii) Ss.(2) of S. 263 stipulates that no order shall be made U/ss.(1) after the expiry of two years from the end of the financial year in which the order sought to be revised was passed. That period of two years from the end of the financial year in which the original order of assessment dated 27-12-2006 was passed, had expired on 31-3-2009. Hence, the exercise of the revisional jurisdiction in respect of the original order of reassessment was barred by limitation.

(iii) Where an assessment has been reopened u/s. 147 in relation to a particular ground or in relation to certain specified grounds and subsequent to the passing of the order of reassessment, the jurisdiction u/s.263 is sought to be exercised with reference to issues which did not form the subject of the reopening of the assessment or the order of reassessment, the period of limitation provided for in Ss.(2) of S. 263 would commence from the date of the order of assessment and not from the date on which the order reopening the reassessment has been passed.

(iv) The submission of the Revenue was that when several issues are dealt with in the original order of assessment and only one or more of them are dealt with in the order of reassessment passed after the assessment has been reopened, the remaining issues must be deemed to have been dealt with in the order of reassessment. Hence, it had been urged that the omission of the Assessing Officer, while making an order of reassessment, to deal with those issues u/s. 143(3), read with S. 147, constituted an error which could be revised in exercise of the jurisdiction u/s.263. The submission could neither be accepted as a matter of first principle, based on a plain reading of the provisions of S. 147 and S. 263, nor was it sustainable in view of the law laid down by the Supreme Court.

(v) For those reasons, the exercise of the revisional jurisdiction u/s.263 was barred by limitation.”