Allahabad High Court
Dy. Commissioner Of Income Tax vs M/S Optima Era Infra Joint Venture on 1 December, 2022
Bench: Sunita Agarwal, Vipin Chandra Dixit
HIGH COURT OF JUDICATURE AT ALLAHABAD
?Court No. - 39
Case :- INCOME TAX APPEAL No. - 89 of 2022
Appellant :- Dy. Commissioner Of Income Tax
Respondent :- M/S Optima Era Infra Joint Venture
Counsel for Appellant :- Manu Ghildyal
Hon'ble Mrs. Sunita Agarwal,J.
Hon'ble Vipin Chandra Dixit,J.
Supplementary affidavit filed today is taken on record.
Heard Sri Manu Ghildyal, learned counsel for the appellant.
This is an income tax appeal filed under Section 260-A of the Income Tax Act, 1961 by the revenue challenging the judgment and order dated 31.5.2022 passed by the Income Tax Appellate Tribunal, Delhi Bench 'E', New Delhi whereby the order passed by the learned CIT(A)-1, NOIDA has been affirmed.
The submission of Sri Manu Ghildyal, learned counsel appearing for the appellant revenue is that in the proceeding of evaluation of the return submitted by the assessee, the notice under Section 143(2) of the Income Tax Act had been issued to the assessee twice, first notice is dated 26.8.2013 and the second notice is dated 28.1.2015. The dispute is with regard to Assessment Year 2012-13 and in connection with the return of income tax submitted by the assessee on 24.9.2012.
The submission of Sri Manu Ghildyal learned counsel for the appellant is that in response to the notice dated 28.1.2015, a reply was filed by the assessee on 4.3.2015. The submission is that the provisions of Section 144(1)(c) of the Income Tax Act are not attracted in the facts of the present case as it is not a case where assessee has failed to comply with all the terms of the notice under Sub Section (2) of Section 143 of the Income Tax Act.
We find inherent fallacy in the above submission of the learned counsel for the appellant revenue in view of the categorical finding of the Tribunal that once the Assessing Officer was not satisfied with the conduct of the assessee in furnishing the information and details sought by him, it could have assessed under Section 144 of the Income Tax Act to frame the best judgment assessment.
The CIT(A) and the Income Tax Tribunal both have recorded the concurrent findings of fact that the Assessing Officer could not brought any material on record to justify the disallowance of 20% of the gross expenses, which could not have been done under the provisions of Section 143 of the Income Tax Act, 1961. The finding recorded by the Tribunal that the Assessing Officer has referred no material at all while passing the impugned assessment order could not have been challenged before us to demonstrate it to be perverse or against the evidence on record.
A perusal of Sections 143 and 144 of the Income Tax Act, 1961 makes it is evident that during the scrutiny of the return submitted by the assessee, the Assessing Officer once issued notice under Section 143(2) could have proceeded to pass order under Section 143(3), after taking into account all relevant materials which he has gathered or on the evidence produced by the assessee, to make an assessment of the total income and loss of the assessee. However, in case there was no material before the Assessing Officer or in response to the notice under Section 143(2) the assessee did not furnish the relevant material, the appropriate course of action for the Assessing Officer was to proceed under Section 144 of the Income Tax Act for the best judgment assessment. Thus, the assessment without any relevant material on record, cannot be made within the scope of Sub Section (3) of Section 143 of the Income Tax Act.
The facts and circumstances of this case attracts the provision of Section 144(1)(c) of the Income Tax Act, inasmuch as, the assessee in response to the notice under Section 143(2) did not comply with all the terms of the notice, i.e. did not furnish the relevant evidence, books of accounts etc. before the Assessing Officer.
The best judgment assessment made by the Assessing Officer while exercising power under Section 143(3) of the Income Tax Act, 1961 is in contravention of the provisions of the Income Tax Act. Moreover, no interference can be made in the concurrent findings of fact recorded by the CIT(A)-1 and Income Tax Appellate Tribunal. No substantial question of law arises for consideration before us.
The appeal is dismissed, accordingly.
Order Date :- 1.12.2022
Kpy
