The assessee sold a residential flat and derived long-term capital gain of Rs. 30.08 lakhs. The assessee filed his return of income under S.  139(1) on 17-7-2014 and claimed deduction under section 54 on account of purchase of new residential flat. The AO  completed assessment under S.  143(3) and accepted income returned by the assessee. PCIT in revision proceedings held that the conditions of S.  54(2) had been violated as the assessee had not invested the capital gain in purchasing a new residential house before the due date of filing of return under S.  139(1). The assessee made first payment toward purchase of flat on 5-10-2015 and next on 15-2-2016 and had not deposited the unutilized capital gain in Capital Gain Account Scheme before the due date of furnishing return under S.  139(1). Thus, the assessee was not eligible for deduction under S.  54(1) of the Act. On appeal the Tribunal held that it cannot be said that the decision of the AO is in accordance with the legal position prevailing at the relevant point of time. The decisions cited by the assessee challenging the validity of exercise of jurisdiction under S. 263, would not help the assessee in view of the specific fact involved in the instant case. Thus, on overall consideration of facts and material on record and keeping in view the ratio laid down in the catena of decisions, including the decision of the jurisdictional High Court in Humayun Suleman Merchant v. CIT (2016) 387 ITR 421 (Bom.)(HC), it is to be held that PCIT has correctly exercised his power under section 263 to revise the impugned assessment order. Accordingly, the order passed under S. 263 is to be upheld by dismissing the grounds raised by the assessee. (AY. 2014-15)