TaxTMI 
TaxTMI 
2025 (6) TMI 1110
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....ned PCIT set aside the assessment order dated 27.05.2021 passed under section 143(3) read with section 144B of the Act by the National Faceless Assessment Centre ("NFAC"), Delhi, and directed the Assessing Officer to pass a fresh assessment order after examining the allowability of Labour Welfare Cess expenditure. Facts of the Case: 2. The assessee, Sardar Sarovar Narmada Nigam Ltd, is a company engaged in the execution of the Sardar Sarovar Project comprising construction of dams, canal networks, powerhouses, and related infrastructure for providing drinking water and irrigation facilities across multiple states. The assessee filed its original return of income for the Assessment Year 2018-19 on 13.10.2018 declaring a total loss of Rs. ....
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.... of the Act. After considering the assessee's detailed submissions, the learned PCIT passed the impugned order under section 263 of the Act dated 08.03.2024, setting aside the assessment order dated 27.05.2021 and directing the Assessing Officer to examine afresh the allowability of Labour Welfare Cess and pass a denovo assessment order in accordance with law. 5. Being aggrieved by the said order of the learned PCIT, the assessee is in appeal before us raising following grounds: 1. The Hon'ble Principle Commissioner of Income-tax ("Hon'ble PCIT") erred in law and facts of the case by invoking the revision proceedings u/s. 263 of the Act on the premise that the learned Assessing Officer failed to disallow Labour welfare cess ....
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....earing on behalf of the assessee submitted that the Faceless Assessing Officer (FAO), during the course of assessment proceedings, had duly issued a notice under section 143(2) of the Act dated 22.09.2019, wherein specific information was called for regarding the "Claim of any other amount allowable as deduction in Schedule BP." The learned AR further drew attention to the notices issued under section 142(1) of the Act dated 06.01.2021 and 05.03.2021, wherein the FAO specifically sought detailed information relating to the "Any other amount allowable as deduction" amounting to Rs. 67,53,500/-, along with a break-up of such amount and copies of the ledgers pertaining to each expense account. The learned AR submitted that in response to the a....
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....ns of the assessee company in the course of carrying out construction works under the Sardar Sarovar Project. In support of the submissions, reliance was also placed on some judicial precedents. 7. The Departmental Representative (DR) strongly supported the order passed by the PCIT and submitted that the FAO failed in conducting adequate inquiry on the issue specifically pointed out by the PCIT. 8. We have carefully considered the rival submissions, perused the material placed on record, including the notices issued, replies filed, assessment order, and the impugned order passed under section 263 of the Act. The principal contention of the assessee is that the Faceless Assessing Officer (FAO) had made due inquiries during the course of as....
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....xpenditure item amounting to Rs. 20.26 lacs constitute a lapse in the conduct of the assessment proceedings. It is particularly significant to note that the assessee's case was selected for Complete Scrutiny under the Computer Aided Scrutiny Selection (CASS) mechanism. In cases selected for Complete Scrutiny, the Assessing Officer is expected to examine all material aspects of the return of income diligently and conduct inquiries into all significant claims made by the assessee. In the absence of any specific inquiry or verification, the assessment order cannot be said to have been passed after due application of mind. It is well settled that where an assessment order is passed without making inquiries or verification which ought to have be....