V. DONGZATHANG, A.M.: These two appeals are directed against consolidated order to CIT under s. 263 of IT Act, 1961. assessee HUF derives income from money lending business. Another business styled as M/s Singhal Saree Centre at Chowk Bazar, Kairana, is also run as proprietary business of Shri Ravinder Kumar. While completing assessment for asst. yr. 1978-79 in case of M/s Singhal Saree Centre ITO held that said business belonged to assessee HUF namely Shri Daya Ram. Thereupon CIT issued notice to assessee under s. 263(1) of IT Act to show cause as to why those assessment should not be cancelled as income of M/s Singhal Saree Centre has not been included which was considered to be prejudicial to interest of Revenue. Rejecting explanations offered CIT cancelled assessment of assessee for above two years and directed ITO to complete assessment afresh. assessee is aggrieved and has come up in appeal before us. According to Shri Ashok Kumar Garg, ld. counsel of assessee, order of ITO cannot be erroneous and prejudicial to interest of Revenue especially when assessment in case of M/s Singhal Saree Centre has not become final, there being appeal pending before appellate authorities. ITO assessing M/s Singhal Saree Centre in instant case was of opinion that business belonged to assessee. But that opinion of ITO was not conclusive being challenged by assessee before appellate authorities. It is also contended that facts of case of Ravinder Kumar for asst. yr. 1978-79 are entirely different from that of asst. yr. 1978-79 when Shri Ravinder Kumar attained majority. As such order of CIT is liable to be cancelled. On other hand, Shri P. K. Sridharan, ld. Departmental Representative supported order of CIT. Since ITO has already recorded specific finding in case of M/s Singhal Saree Centre run in name of Shri Ravinder Kumar order of ITO in regard to assessee HUF becomes erroneous and prejudicial to Revenue. On these facts is claimed that CIT was quite justified in invoking provisions of s. 265 of IT Act, 1961. On careful consideration of rival submissions we are of view that t h e contentions of assessee have got merit. findings of ITO assessing Shri Ravinder Kumar for asst. yr. 1978-79 cannot ipso facto be applied to asst. yr. 1979-80 in case of assessee HUF. CIT relied on facts of case of Shri Ravinder Kumar for asst. yr. 1978-79 but in doing so CIT did not give reasonable opportunity to assessee to rebut findings of ITO. Since assessee had contested that finding in appeal before appellate authorities it is proper that CIT should have given reasonable opportunity to assessee to disprove findings of ITO for asst. yr. 1978-79 in case of Ravinder Kumar. CIT(A) in fact took notice of appal and directed ITO to consider decision of appellate authorities in case of Shri Ravinder Kumar. If decision of appellate authorities in case of Shri Ravinder Kumar goes against that of ITO, then in that case CIT will not be justified in assuming power under s. 263 as there would be no order which is erroneous and prejudicial to interest of Revenue. Since CIT has not recorded his finding in regard to order of Shri Ravinder Kumar for asst. yr. 1978-79 and did not consider contentions of assessee in that regard, we consider it necessary to set aside his order and restore it to his file with direction that he will redecide matter after giving due opportunity to assessee. appeal was delayed and time barred by 9 days. delay has been condoned after considering application and explanations of ld. counsel of assessee. For statistical purpose appeal shall be treated as allowed. *** DAYA RAM v. INCOME TAX OFFICER