TaxTMI 
TaxTMI 
2024 (10) TMI 473
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.... of the I.T. Act 1961 is not applicable in this case when particularly, and the assessee has not made any payment of PF/ESI on payment so of labour charges to the daily wager/labours." 2. Brief facts in this case are that the assessee is a firm which has been assessed u/s. 143(3) of the Act on total income of Rs. 2,67,308/-. Subsequently, the case of the assessee was reopened u/s. 147 of the Act on the issue of violation in non-deduction of TDS u/s. 194A and u/s. 194C of the Act. Accordingly, the provisions of Section 40(a)(ia) of the Act are triggered and additions were made of Rs. 1,56,500/- and Rs. 58,50,226/-. respectively. 3. Aggrieved the assessee carried the matter in appeal before the CIT(Appeals) wherein, the contentions of the assessee are accepted on merits by the CIT(Appeals) and appeal of the assessee was partly allowed. 4. Dissatisfied with the aforesaid order, the revenue is in appeal before us assailing the order of deleting the disallowance of Rs. 58,50,226/- u/s. 40(a)(ia) of the Act for non-deduction of TDS on payment of labour charges to sub-contractor namely, supervisor or Munshis. 5. Before us, at the very outset, the Ld. AR for the assessee (re....
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.... The assessment in this case has been completed u/s. 143(3) on 05.09. 2011 at Rs. 2,67,308. It is noticed that the assessee has failed to deduct tax on payment of interest for Rs. 1,56,500/ - against the loan borrowed from non-banking financial company. Thus the said payment of interest deserves to be disallowed u/s. 40(a)(ia) of the Act and requires to be added back to the total income. Besides above the assessee has made repayment of loan to non-banking financial companies in cash. Therefore, I have reason to believe that Rs. 1,56,500/ - chargeable to tax has escaped assessment. Issue notice u/s. 148 of the IT Act, 1961 Put up before Hon'ble JCIT, Korba for kind sanction u/s. 151 for issuance issue of notice u/ s.148 of the IT Act 1961. Sd/ - ITO, Ambikapur Approved Sd/ - Jt.CIT, R-Korba" 8. The respondent humbly submits that the reasons recorded contains two parts the first part being narration of facts and second part is recitation of language of the Act. There is no satisfaction regarding escapement of income and secondly the ld.Jt.CIT, Range, Korba has signed on the dotted lines by writing just "Approved". It is not a....
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....es our consideration. Section 158 BC(b) provides for enquiry and assessment. The said provision reads "that the assessing officer shall proceed to determine the undisclosed income of the Block period in the manner laid down in Section 158 BB and the provisions of Section 142, sub-section (2) and (3) of Section 143, Section 144 and Section 145 shall, so far as may be, apply." An analysis of this sub section indicates that, after the return is filed, this clause enables the assessing officer to complete the assessment by following the procedure like issue of notice under Sections 143(2)/142 and complete the assessment under Section 143(3). This Section does not provide for accepting the return as provided under Section 143(i)(a). The assessing officer has to complete the assessment under Section 143(3) only. In case of default in not filing the return or not complying with the notice under Sections 143(2)/142, the assessing officer is authorized to complete the assessment ex-parte under Section 144. Clause (b) of Section 158 BC by referring to Section 143(2) and (3) would appear to imply that the provisions of Section 143(1) are excluded. But Section 143(2) itself becomes necessary o....
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....ld be made without issuing notice under Section 143(2) of the Act. However, it is contended by Sri Shekhar, learned counsel for the department that in view of the expression "So far as may be" in Section 153 BC(b), the issue of notice is not mandatory but optional and are to be applied to the extent practicable. In support of that contention, the learned counsel has relied on the observation made by this Court in Dr. Pratap Singh's case [1985] 155 ITR 166(SC). In this case, the Court has observed that Section 37(2) provides that "the provisions of the Code relating to searches, shall so far as may be, apply to searches directed under Section 37(2). Reading the two sections together it merely means that the methodology prescribed for carrying out the search provided in Section 165 has to be generally followed. The expression "so far as may be" has always been construed to mean that those provisions may be generally followed to the extent possible. The learned counsel for the respondent has brought to our notice the observations made by this Court in the case of Maganlal Vs. Jaiswal Industries, Neemach and Ors., [(1989) 4 SCC 344], wherein this Court while dealing with the scope ....
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....a return or fails to comply with all the terms of the notice issued under section 142 or fails to comply with the direction issued under sub-section (2A) of section 142 or fails to comply with the terms of the notice issued under section 143(2) of the Act. 23. As noted above, the record shows that the respondent /assessee's return was in place. The respondent/assessee had taken the plea that the earlier return should be treated as a return in response to notice under section 148 of the Act. 24. Therefore, for the AO to take recourse to section 144 of the Act was completely uncalled. 25. In our opinion, section 144 of the Act was taken recourse to under a mistaken belief, or otherwise, that there was no return on record. 26. Since a response was on record, undoubtedly, the AO was required to issue a notice under section 143(2) of the Act and then proceed further in the matter, and perhaps thereafter, frame an assessment under section 147 read with section 144 of the Act. 26.1 This was not done. 27. Therefore, we are of the view that order passed by the Tribunal does not call for any interference. 28. No substantial q....