Assessing Officer made percentage of gross profit addition in respect of alleged bogus purchases . Assessee filed an appeal before the CIT (A) which was pending .Meantime the Commissioner issued show cause notice u/s 263 stating that the Assessing Officer should have made entire purchases as addition. Against the show cause notice writ petition was filed . Allowing the petition the Court held that, on the facts of the case  when the issue was  pending before the Appellate Commissioner, the Principal Commissioner issued a notice seeking to take the order of assessment in suo motu revision. His sole ground was that the Assessing Officer having held that the entire purchase of Rs.4.33 crores from T being bogus, had erred in limiting the addition to Rs. 9.57 lakhs on the basis of the gross profit ratio. While this notice was pending and the assessee had yet to file reply to the notice, the Appellate Commissioner heard and decided the assessee’s appeal against the order of assessment on January 5, 2018. In this order, he held that the Assessing Officer could not have made the addition of Rs. 9.57 lakhs on gross profit basis.  Court also held that, since there had been an appeal regarding the matter the Commissioner had no jurisdiction to revise the order. Clause (c) of Explanation 1 to section 263(1) of the Income-tax Act, 1961, is to circumscribe revisional powers in cases where the order passed by the Assessing Officer has been the subject matter of any appeal and such subject matter has been considered and decided in such appeal. This provision thus statutorily recognizes the principle of merger and avoids any conflict of opinion between two quasi-judicial authorities of the same rank. Followed CIT v. Nirma Chemicals  Works P. Ltd.  (2009) 309 ITR 67 (Guj.)(HC). (AY. 2011-12)