During survey, excess stock was found and the AO issued a specific show-cause notice asking why the amount should not be treated as unexplained investment under S. 69 and taxed under S. 115BBE. The assessee explained that the excess stock represented business stock duly recorded in the books and offered as business income. After considering the reply, the AO accepted the explanation and made only a small addition. The Principal CIT invoked S. 263 alleging lack of enquiry and non-application of mind. The High Court held that since the AO had conducted enquiry through a specific notice and taken a plausible view, the twin conditions of “erroneous” and “prejudicial to revenue” were not satisfied. Mere loss of revenue or disagreement with the AO’s view could not justify revision. Accordingly, the revision order was rightly set aside by the Tribunal. (AY. 2017–18)