AO Fails to Properly Examine Rs. 1.27 Cr Co-operative Society Deposits: ITAT upholds PCIT’s Revision Order

The Income Tax Appellate Tribunal (ITAT) upheld the Principal Commissioner of Income Tax's (PCIT) revision order, noting that the Assessing Officer (AO) failed to properly examine ₹1.27 crore in deposits made by a co-operative society. The PCIT had invoked revisional jurisdiction under Section 263, finding the initial assessment order to be erroneous due to the lack of thorough investigation into these substantial deposits. The ITAT agreed with the PCIT, emphasizing the AO's responsibility to scrutinize high-value transactions and ascertain their genuineness and source. The failure to do so resulted in prejudice to the revenue. This ruling reinforces the PCIT's power to review and correct assessment orders where the AO has failed to conduct adequate inquiry.