TaxTMI 
TaxTMI 
2024 (10) TMI 1473
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....d in gross breach of natural justice, kindly be quashed. 3. The ld. CIT (A) erred in law as well as on the facts of the case in confirming the penalty u/s 271B of the Act of Rs. 1,50,000/- imposed by the AO. The penalty so imposed by the AO and confirmed by the ld. CIT (A) being totally contrary to the provisions of law and facts kindly be deleted in full. 4. The appellant prays your honour to add, amend or alter any of the grounds of the appeal on or before the date of hearing. 2. The brief facts of the case are that the assessee is a limited company. The assessment in this case was completed under section 144 read with section 147 of the IT Act, 1961 on 31.10.2018 at a total income of Rs. 5,08,87,740/-. The AO has noticed that the appellant has not maintained books of account and got the same audited under section 44AB of the Act. The AO while framing the assessment also initiated penalty proceedings under section 271B for non-maintenance of books of accounts. During the proceedings the AO issued various notices to the assessee which were duly replied by the assessee in timely manner. However, unsatisfied with the response of the assessee, the AO passed penal....
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....hout the period of 2-3 years. Not only the assessee but also the tax consultant who are also practicing in small towns are not sound with the technical knowledge and infrastructure, it is quite basic for them to have lost sight of such communication if any sent by the department. Another aspect to take note of is that COVID-19 was still prevalent at that time and activities did not resume with full force and it was only in March 2022, the normalcy could have been said to be restored as evident from the order of Apex court passed on dated 23.03.2020 in Suo motu Writ Appeal (Civil) No. 3 of 2020 on the issue of law of limitation holding as under: "...The period from 15-3-2020 till 28-2-2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings." In the meanwhile, the Central Government was continuously relaxing the time limits for taking actions/making compliance through TOLA. In these circumstances there appears no justified reason at all as to why the ld. CIT(A) was issuing notices for such a short period of 7-10 days only. Also there was no urgen....
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....y be made to order of Apex Court decision in CIT vs. Kanpur Coal Syndicate 53 ITR 225 (SC) in which it was held that the first appellate authority, the Ld. CIT(A) in the case before us, has plenary powers in disposing off an appeal; that the scope of her power is co-terminus with that of the ITO, that she can do what the ITO can do and also direct him to do what he failed to do. In this context, useful reference may also be made to Hon'ble Apex Court's decisions in the cases of CIT vs. Rai Bahadur Hardutroy Motilal Chamaria 66 ITR 443 (SC) and CIT vs. B.N. Bhattachargee 118 ITR 461 (SC) for the proposition that an assessee having once filed an appeal, cannot withdraw it and even if the assessee refuses to appear at the hearing, the first appellate authority can proceed with the enquiry and if he finds that there has been an underassessment, he can enhance the assessment. Just as, once the assessment proceedings are set in motion, it is not open to the Assessing Officer to not complete the Assessment Proceedings by allowing the Assessee to withdraw Return of Income; it is similarly, not open for Ld. CIT(A) to not pass order on merits by dismissing the appeal in limine, whether o....
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....he points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Section 251(l)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it dear that while considering the appeal, the CTT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact, the CIT(A) is obliged to dispose of the appeal on merits. In fact, with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CTT(A) is co-terminus with that of the Assessing Officer i.e. he can do all that Assessing Offi....
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.... Authors Chaturvedi Pethisaria Vol. 3 Edition V at page 4932, reproduced hereunder verbatim:- "Best Judgment assessment - how to be made? - In making a best judgment assessment the Assessing Officer must not act dishonestly or vindictively or capriciously because he must exercise judgment in the matter. He must make what he honestly believes to be a fair estimate of the proper figure of assessment, and for this purpose he must be able to take into consideration local knowledge and repute in regard to the assessee's circumstances, and his own knowledge of previous returns by and assessments of the assessee and all other matters which he thinks will assist him in arriving at a fair and proper estimate; and though there must necessarily be guess-work in the matter, it must be honest guess-work [CIT Vs. Laxmi Narain Badridas, (1937) 5 ITR 170, 180 (PC), reversing (1934) 2 ITR 246 (Nag); CIT Vs. S. Sen, (1949) 17 ITR 355 (Orissa); Singh Engineering Works Vs. CIT, (1953) 24 ITR 93 (All); M.A. Rauf Vs. CIT, (1958) 33 ITR 843 (Pat); Mohanlal Mahribal Vs. CIT, (1982) 133 ITR 683 (MP) ; Ganga Prasad Sharma Vs. CIT, (1981) 132 ITR 87 (MP) & (1981) 127 ITR 27 (MO); Balchand Udairam Vs....