TaxTMI 
TaxTMI 
2020 (4) TMI 901
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....ct') by exercising jurisdiction u/s 263 of the Act 2. Brief facts of the case are that the assessee company filed its return of income for the assessment year under consideration declaring nil income after setting off of brought forward losses. The AO passed the assessment order u/s 143 (3) of the Act and determined the total income of the assessee at Rs. 14,24,69,214/- after making additions on account of unexplained cash credit u/s 68 of the Act, amounting to Rs. 13,93,23,864/-, Rs. 15,12,000/- on account of annual letting value determined in respect of two flats sold by the assessee company during the previous year, Rs. 15,71,000/-on account of disallowance made u/s 40(a)(ia) of the Act and Rs. 62,350/- and on account of disallowance ....
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....done a meaningful enquiry taken a decision not to make any addition on this account based on his judgment. d) It is the judgment of the AO and not an omission, thus cannot be termed as erroneous or prejudicial to the interest of the revenue." 5. Before us, the Ld. counsel for the assessee submitted that the impugned order passed by the Ld. Pr. CIT is bad in law as the AO has passed the assessment order after carrying out enquiries. The Ld. counsel further submitted that the Bhilai unit of the assessee company was under control of Sh. Sunil Aggarwal, younger brother of Sh. Anil Aggarwal. Since, Sh. Sunil Aggarwal had obtained restrain order from CLB, the assessee company managed by Sh. Anil Aggrawal was not allowed to interfere w....
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.... order by exercising jurisdiction u/s 263 of the Act. The Ld. DR invited our attention to para 4 of the order passed by the Ld. Pr. CIT, wherein the Ld. Pr.CIT has mentioned that even though AO had issued a notice u/s 133 (6) of the Act for obtaining financial statements of Bhilai unit from the other promoter of the assessee company no such details were received by the AO. The Ld. DR further pointed out that in the previous assessment year 2012-13 ad-hoc additions were made by the AO. The ITAT in the assessment year 2005-06 confirmed addition of 5% of the total turnover of the Bhilai unit. However, in the assessment year under consideration, the AO has not made any addition and no reason has mentioned in the assessment order for not making ....
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....he Bhilai unit had been adopted as the net profit of that unit. This has been so held later during A.Yrs. 2010-11, 2011-12 and 2014-15 as well. In respect of A.Yrs 2012-13 and 2013-14 there have been no details available of even the turnover of the Bhilai unit. Admittedly, the Bhillai unit has continued to function even during the previous year relevant to A.Y. 2013-14. The assessing Officer had made lump sum addition on this count of Rs. 20 Lakhs for A.Y. 2012-13 and no addition whatsoever has been made by the assessing officer on this count for A.Y. 2013-14." Prima Facie the failure of the Assessing Officer to make relevant and meaningful inquiry as warranted by the facts of the present case and allowing without causing necessary....
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....cial statements of Bhilai unit from the other promoter of the assessee company. However, no details were received by the AO. We further notice that the AO has not mentioned any reason for not making any addition in respect of Bhilai unit. As pointed out by the Ld. counsel, addition of 5% of the turnover made from the AY 2004-05 to 2007-08 and 2010-11 to 2012-13, however in the assessment year under consideration, the AO has not made any addition whereas in the assessment year 2014-15 and 2015-16 the AO had made ad-hoc addition. Further, the AO has not given any reason in the assessment order or even not discussed about the financial statements of Bhilai unit which shows that the AO has failed to exercise due diligence to determine the incom....