The assessee, a trust registered under section 12AA running engineering colleges, following a search, had offered cash receipts as “anonymous donations” taxed under section 115BBC and reclassified demand draft receipts as “voluntary donations” claiming exemption under section 11, which disclosures were accepted by AO after due examination in the order passed under section 153A/153B; however, PCIT invoked section 263 for the AY 2018-19 and 2020-21 to deny exemption on alleged unaccounted capitation fees, relying on the Madras High Court decision in CIT v. MAC Public Charitable Trust. On appeal, the Tribunal held that since AO had examined the issue in detail during the search assessment proceedings and taken a plausible view without any resultant prejudice to the Revenue, the twin conditions for invoking section 263 were not satisfied; further, since the Madras High Court decision relied upon by the PCIT had already been stayed by SC prior to issuance of the section 263 notice, the PCIT ought to have made a preliminary enquiry regarding its applicability, and invocation of jurisdiction under Explanation 2(d) to section 263 on the basis of a non-operative judgment rendered the revision void ab initio; it was further noted that the assessee’s registration under section 12AA remained in force and no proceedings for its cancellation or for violation of the Tamil Nadu Educational Institutions (Prohibition of Collection of Capitation Fee) Act, 1992 had been initiated, and that a stayed order, unlike a quashed order, does not restore the pre-existing position from the date of stay. Accordingly, the revision order was set aside.(AY. 2018-19 , 2020-21)