2023 (4) TMI 1111

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....correctness of PCIT's revision directions in issue terming the Assessing Officer's corresponding section 144 best judgment assessment dated 20.12.2019 is concerned, there is hardly any dispute that he is assessed as an individual. He had filed his return on 14.02.2018 declaring total income of Rs.36,95,000/-. The Assessing Officer took up scrutiny. He issued section 143(2) notice dated 21.09.2018 as well as various other such correspondences. The assessee does not seem to have responded to the same. This compelled the Assessing Officer to complete his section 144 best judgment assessment dated 20.12.2019 inter-alia, disallowing / adding assessee's expenses debited in P & L account to the extent of Rs.20 lacs, sundry creditors of Rs.30 l....

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....ties. Learned counsel at this stage invited our attention to page 294 in the assessee's paper book that the above stated field authorities had submitted their revision proposal(s) to the PCIT so as to invoke the impugned revision proceedings. We further note that there is no indication either in the PCIT's section 263 twin show cause notices (supra) or in his detailed discussion that he had simply accepted the proposal than applying his independent mind on the facts and circumstances of the case. Coming to the assessee's foregoing judicial precedents, it is noticed that the hon'ble Calcutta high court had nowhere settled the issue that the Assessing Officer could not submit the proposal as the relevant facts therein sufficiently indicated t....

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....g issues as well. We deem it appropriate at this stage to quote section 263 Explanation (2) (a) and (b); inserted by the Finance Act, 2015 w.e.f. 01.06.2015 that such a failure on the Assessing Officer's part in framing his assessment without due enquiries and verification and allowing relief without enquiry into the claim are deemed to be of an instance of the same being an erroneous one causing prejudice to the interest of Revenue. Various landmark judicial precedents - Malabar Industrial Co. Ltd. vs. CIT (2000) 243 ITR 83 (SC), CIT vs. Pavelli Projects Pvt. Ltd. (2023) 149 taxmann.com 115 (SC), Rampyari Devi Saraogi vs. CIT (1968) 67 ITR 84 (SC) and Gee Vee Enterprise vs. CIT (1975) 99 ITR 375 (Del) have unanimously held that such an ass....