Dismissing the appeal of the revenue the Tribunal held that that there was no concluding finding given by the Principal Commissioner on the issue of allowability of the claim of Rs. 13 lakhs on account of sales return. Hence, when the Assessing Officer had to take a decision based on the outcome of the enquiry conducted in the proceedings pursuant to the revision order under section 263 then the finding of the Assessing Officer was subjected to challenge in the appeal and non-challenge of the revision order passed under section 263 would not operate as a bar for filing the appeal against the order passed by the Assessing Officer. Distinguished Hardillia Chemicals Ltd. v. CIT (1996)221 ITR 194 (Bom.)(HC). On merit the Tribunal held that the business loss is allowable deduction in respect of sales returned. (AY.2011-12)