CBDT has passed an order on 16.05.2014 being no.11of 2014 (F.NO.279/MISC, /M-115/2013-ITJ) stating that it shall supervise the revision orders passed by the CIT under section 264 of the Income Tax Act.
CBDT has also passed an instruction to the CIT to raise the standard of its revisionary orders under section 264.
Provisions of Section 264 of the Income Tax Act, 1961:
Section 264 of the Income Tax Act permits assessees to file an application before the CIT for revision of orders passed by the AO. Under the provisions of Section 264 of the Income Tax Act, 1961 the Commissioner of Income Tax (CIT) may, either of his own or on an application filed before it by an assessee, revise an order passed by a subordinate authority.
The power of revision under section 264 is not an administrative but a quasi – judicial power.
The CIT may, before prior to such revision, inquire into the matter subject to the provisions of the Act, and thereafter pass such order or orders as it deems fit and proper.
An application for revision must be made within one year from the date of the impugned order or the date on which the said order was communicated to him, whichever is earlier. However, the Commissioner may, if satisfied that there was sufficient reason that prohibited the assessee from making the application within the stipulated period, entertain an application made after the due period.
But the Commissioner cannot revise any order where an appeal against the same is pending before the Deputy Commissioner (Appeals)] or to the Commissioner (Appeals)] or the Appellate Tribunal. The application made by an assessee for revision under section 264 shall be filed along with the prescribed fee.
Requirements of the new order:
As per new direction of the CBDT, there shall be administrative supervisions upon all orders passed by the CIT. The statutory order passed by the CIT as per section 264 of the Act is needed to be reported by the CIT and should also be supervised by the supervisory Officers.
The CIT is required to prepare a gist of the orders passed as per section 264 of the Act and shall have to report the same to the principal Chief Commissioner of Income Tax or the Chief Commissioner of Income Tax in the month of the date of order and also is required to send a copy of such order.
The CCIT or the principal Chief Commissioner of Income Tax shall report the said orders passed as per section 264 of the Act under his jurisdiction along with his view regarding any order to the Zonal Member of the CBDT through a letter. The CCIT or the principal Chief Commissioner of Income Tax shall also communicate his view or opinion to the CIT.
A remedy under section 264 has been provided by the Legislature to help an aggrieved assessee who is unable to approach the appellate authorities to get relief in case he has no other alternative remedy. Even those orders which are not appeal able may be approached by the assessee for revision before the CIT.
The revisional authority is a judicial discretion and the same should be exercised judiciously. It is a power which should be exercised strictly in the interest of justice. For the said reasons the CBDT aims to supervise all orders passed under section 264 by the CIT.