TaxTMI 
TaxTMI 
2023 (4) TMI 683
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....in appeal are as under: "1. The learned Principal Commissioner of Income-tax - Rajkot -1, Rajkot erred in assuming jurisdiction u/s 263 of the Act, particularly in the light of reasons stated by him in the show cause notice and in the order passed u/s 263 of the Act and hence the impugned order is bad in law. 2. The learned Principal Commissioner of Income-tax, Rajkot - 1, Rajkot erred in setting aside the assessment order framed u/s 143(3)of the Act by holding that the AO has not properly examined the facts of the case in respect of genuineness of sub-contract expenses and that the AO ought to have examined possibilities of applicability of provisions of Sec. 115BBEof the Act. 2. The learned Principal Commissioner of Income-tax, Ra....
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....n is made of Rs. 29,30,229/- as unexplained and unjustified expenditure comes under the purview of section 69C of the Income-tax Act. 3. However, it is observed that during the assessment proceeding, the AO while charging the tax on such addition of unexplained expenditure u/s. 69C of the Act, has not applied the provisions of Sec. 115BBE of the Act. The AO should have been taxed @ 60% enhanced by applicable surcharge of 25% of such tax as per the provision of Sec. 115BBE of the IT. Act. The AO had not verified the issue and correct application of law while finalizing the assessment proceeding u/s. 143 (3) of the Act on 25-12-2019. This has rendered the order erroneous as well as prejudicial to the interest of the revenue. 4. In view ....
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....such income should have been taxed @ 60% enhanced by applicable surcharge of 25% on such tax. However, the tax was charged on this income @30% while finalizing the assessment. The AO had not verified these issues during the finalizing the assessment proceedings/s.143 (3) of the Act on 25-1 2-201 9. 3. Therefore, the assessment order passed by the Assessing Officer for A.Y 2017-18 may be prima facie erroneous in so far as it is prejudicial to interests of the revenue. Hence, proceedings u/s 263 of the Act are being initiated with a view to pass a suitable order. Before passing of such order, you are hereby given an opportunity of being heard in the matter. In this connection you are requested to famish your reply / submission / explanatio....
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....sed in the case of the assessee placed before us in PB Page No.1 to 5, more particularly, para-4 of the order to para-4.3 of the order, where the issue of disallowance of expenditure at Rs.29,30,229/- was discussed as under: "4.3 But in view of the above discussion and facts, the authenticity of the expenses could not be ascertained. Hence, an amount of Rs. 29,30,229/- is disallowed and added back to the total income of the assessee. Penalty proceedings u/s 270A of the I.T. Act, 1961 are initiated separately for misreporting of income in consequence of under reporting of income" 5. Our attention was also drawn to provision of section 69C of the Act, which reads as under: 69C. Where in any financial year an assessee has incurred any ex....