Commissioner Bound by ITAT Special Bench in Section 264 Revision | HC

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section 264 revision

Case Details: Samir N. Bhojwani vs. Principal Commissioner of Income-tax - [2026] 182 taxmann.com 787 (Bombay)

Judiciary and Counsel Details

  • B. P. Colabawalla & Firdosh P. Pooniwalla, JJ.
  • Atul K. Jasani & J. D. Mistri, Sr. Adv. for the Petitioner.
  • Subir Kumar, Niyanta Trivedi, Advs. & Diksha Pandey for the Respondent.

Facts of the Case

The petitioner, an individual, filed an application under section 264 before the Principal Commissioner seeking revision of the tax treatment of capital gains computed under section 50. He contended that such gains were taxable at the rate prescribed under section 112 in view of the decision of the jurisdictional Tribunal Special Bench in SKF (India) (2024) 168 taxmann.com 328 (Mumbai – Trib.).

The Principal Commissioner, by order passed under section 264, declined to grant relief and refused to follow the Special Bench decision. Aggrieved by the order, the petitioner filed a writ petition to the Bombay High Court.

High Court Held

The High Court held that the Commissioner completely misdirected himself by failing to follow the Tribunal’s binding decision in SKF (India) (supra). It is not for the Commissioner to decide whether the Tribunal was correct in its decision or not. Even though he may, in his personal opinion, believe the decision wrongly applied the law, he is bound to follow it. If lower authorities are permitted to disregard binding decisions because they believe those decisions are wrong, it would lead to complete chaos in the administration of tax laws.

Accordingly, the writ petition was allowed, and the impugned order passed under section 264 was set aside. The matter was remanded to the Commissioner to pass a fresh order on the assessee’s application, following the decision of the Special Bench of the Tribunal in SKF (India).

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied