Section 263 Proceedings cannot Address issues Beyond Limited Scrutiny Under CASS: ITAT set aside

The ITAT ruled that proceedings under Section 263 of the Income Tax Act cannot extend beyond the issues identified in the limited scrutiny conducted under the Computer-Assisted Scrutiny Selection (CASS). In this case, the Principal Commissioner of Income Tax (Pr. CIT) had attempted to expand the scope of the assessment by addressing issues not covered in the limited scrutiny. The ITAT set aside the Pr. CIT's order, emphasizing that the review under Section 263 should be confined to the matters originally scrutinized. This judgment reinforces the boundaries of tax reassessment, ensuring that taxpayers are not subjected to undue scrutiny beyond the scope initially agreed upon.