TaxTMI 
TaxTMI 
2012 (9) TMI 187
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....on is whether in the facts and circumstances of the case the CIT is justified in invoking the powers under section 263 and setting aside the assessment order passed under section 143(3) of the Income tax Act while passing the impugned order. 3. The assessee company is engaged in the business of manufacturing of flexible packaging materials that is printed laminated film/pouches, printed polythene sheets/bags, etc. The assessment in the case was framed under section 143(3) of the Income-tax Act by order dated 15.12.2008. Subsequently, from examination of the assessment record the CIT noticed that the assessment order is erroneous and prejudicial to the interests of the revenue because the AO has not conducted any enquiry on the issue of e....
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....de the payment towards the purchases through account payee cheques and there is no question of doubting the genuineness of purchases. He has further contended that when the AO has passed the scrutiny assessment under section 143(3) of the Income-tax Act, then, the CIT cannot simply set aside the assessment order and direct the AO to re-do the same. In support of his contention the learned AR has relied upon the decision of the Hon'ble Supreme Court in case of CIT Vs. Max India Ltd., 295 ITR 282, in the case of Malabar Industries Company Limited Vs. CIT, 243 ITR 83 and the decision of Hon'ble Bombay High Court in case of CIT Vs. Design and Automation Engineers(Bombay) Pvt. Ltd., 323 ITR 632 (Bom.). The learned AR has also relied upon series ....
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..../s 143(2) was issued on 18/10/2007. In response to the statutory notices issued along with questionnaire assessee's authorized representative, Sri AV Raghunadha Rao, C.A. attended from time to time and filed information called for. Books of account produced were examined. After discussion and after going through the information filed, assessment is complete accepting the total income of the assessee." 6. It is manifest from the assessment order that the AO has not at all examined the issue of the genuineness of purchases and excess claimed on account of purchases as pointed out by the Commissioner of Income-tax. When the AO has not discussed anything in respect of the claim of expenditure towards the purchases, then, it is a clear case w....
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....o on a factual aspect of genuineness of purchases, then, in our considered opinion the decisions relied upon by the learned AR of the assessee are not applicable in the facts of the case in hand. In the case of Malabar Industries Company Vs CIT (supra), the Hon'ble Supreme Court has held that when the ITO has passed the order without application of mind, then, the order passed by him was erroneous and the prejudicial to the interests of revenue, therefore, the CIT is justified in invoking the provisions of section 263. It is pertinent to note that the assessment order should exhibit some thought process on the part of the assessing officer in order to show that the assessing officer has applied his mind in addressing the issue under cons....