2023 (12) TMI 638

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....sessment order framed by the Assessing Officer (in short ld. 'AO') u/s 154/143(3) of the Act dated 31.07.2015. 2. The assessee is in appeal before the Tribunal raising the following grounds: "1. FOR THAT the Ld. Commissioner of Income Tax (Appeals), N.F.A.C. failed to appreciate that none of the conditions precedent existed and/or have been complied with and/or fulfilled by the Ld. Income Tax Officer, Ward 24(3), Hooghly for his alleged assumption of jurisdiction u/s. 154 of the Income Tax Act, 1961 and the specious order dated 31-07-2015 passed u/s. 154/143(3) of the Act in pursuance to the impugned notice dated 02-07-2015 issued thereunder is therefore ab initio void., ultra vires and ex-facie null in law. 2. ....

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....17.10.2011 and after the case being selected for scrutiny through CASS returned income was accepted and assessed income vide order u/s 143(3) of the Act dated 06.11.2013. Later on, ld. AO passed rectification order u/s 154 of the Act and added the sumptuary allowance of Rs. 45,160/- which was claimed exempt by the assessee in the return and after allowing the deduction 16(ii) of the Act at Rs. 5,000/- income was revised at 9,81,564/-. 5. The assessee challenged the said action of the AO but on account of his failure to appear before ld. CIT(A) ex-parte order was framed. Before us, ld. Counsel for the assessee firstly contended that the rectification made by the AO in the order u/s 154 of the Act is not an apparent mistake. Therefore, ass....

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....owance has to be treated as an entertainment allowance and accordingly, the said allowance received by a person who is in receipt of salary from the Government, to the extent of such allowance are required to be deducted in computing the income chargeable under head salaries U/s 16(ii)(a) Thus, the CBDT circular has clarified that this allowance may be regarded as entertainment allowance and exempt from payment of income tax. For ready reference we reproduced the said letter of CBDT as under:- "Section 17 of the Income Tax Act, 1961- salary perquisite and profits in lieu of salary- sumptuary allowance being in the nature of entertainment allowance not to be included in term "salary" for the purpose of determining perquisite value o....