The Principal Commissioner set aside the assessment order and directed the Assessing Officer to investigate the issue and pass a speaking order. This approach of the Principal Commissioner was erroneous as the law is clear that the Principal Commissioner either he can make enquiry himself or cause such enquiry to be made but such exercise is to be made before passing the order under section 263 of the Act. Admittedly, proceedings under section 154 of the Act were dropped by the same Assessing Officer who had requested for exercising powers under section 263 of the Act by the Principal Commissioner and the revision by the Principal Commissioner was based upon the audit objections. The Principal Commissioner did not dispose of the objection of the assessee that assessment order passed by the Assessing Officer was without jurisdiction. The exercise of power under section 263 of the Act by the Principal Commissioner was not in accordance with law and his order deserved to be quashed.(AY. 2012-13)