HINDUJA NATIONAL POWER CORPORATION LIMITED,HYDERABAD vs. ASST. COMMISSIONER OF INCOME TAX, CIRCLE-2(1), HYDERABAD

We notice at the outset that assessee's instant appeal suffers form 17 days delay in filing. Learned counsel submitted that due to the outbreak of pandemic / covid 19, the assessee is unable to get the documents form the department which caused the impugned delay in filing of the instant appeal. Case law Collector Land Acquisition Vs. Mst. Katiji & Ors, 1987 AIR 1353 (SC) and University of Delhi Vs. Union of India, Civil Appeal No.9488 & 9489/2019 dated 17th Dec., 2019, hold that such a delay; supported by cogent reasons, deserves to be condoned so as to make way for the cause of substantial justice. We accordingly hold that assessee's impugned delay of 17 days is neither intention nor deliberate but due to the circumstances beyond his control. The case is now taken up for adjudication on merits.

Relevant facts in the instant case qua correctness of the learned PCIT’s exercise of the impugned section 263 revision jurisdiction are in a very narrow compass. This 3 assessee is engaged in power generation business. It filed its return of income on 26.11.2014 declaring taxable income of Rs.5,00,16,690. The Assessing Officer thereafter framed his assessment u/s.143(3) r.w.s. 92CA r.w.s. 144C of the Act thereby assessing the assessee's total income at Rs.14,66,52,695. The PCIT has thereafter invoked revision jurisdiction vide his following detailed discussion :

We have given our thoughtful consideration to rival pleadings. Learned counsel vehemently contended during the course of hearing that the PCIT has erred in law and on facts in exercising his 263 revision jurisdiction despite the fact that the taxpayer had placed on record all the relevant material; including that of interest income of Rs.26,80,88,566 on fixed deposit with banks before the Assessing Officer. He further argued that the mere fact that the Assessing Officer had not incorporated the instant issue in his assessment does not itself form the sole reason

We have given our thoughtful consideration to rival pleadings and find no merit in the assessee's stand. This is for the clinching reason that it has not placed on record any material before us which could suggest that the Assessing Officer had examined the impugned interest income issue by way of his questionnaire(s) u/s. 142(1) or u/s.143(2) of the Act. Hon'ble apex court land mark decision in Malabar Industrial Co. Ltd. Vs. CIT 243 ITR 83 (SC) has settled the law long back that such a failure on Assessing Officer’s part in not even examining the issue renders an assessment both erroneous as well as causing prejudice to the interest of Revenue. Case law Gee Vee 5. Learned counsel has not filed any material before us indicating such an examination much less a detailed investigation on the Assessing Officer’s part regarding the assessee's interest income derived from fixed deposits. We make it clear that the assessee's written submissions filed on 19.07.2021 have also placed on record the tribunal’s orders in ITA Nos.1263 to 1264/Hyd/2018 Dt.18.02.2021 for the assessment years 2012-13 and 2013-14 and ITA 1084/Hyd/2018 Dt.30.06.2021 in section 143(3) proceedings regarding interest income. The same along with working for claim of deductions u/s. 57(iii) and treatment of total income tax are unable to rebut the fact of the 8 Assessing Officer having failed to examine the instant issue in A.Y. 2014-15’s regular assessment. We therefore decline the assessee's instant substantive grievances and leave it open to the Assessing Officer to examine all the corresponding facts in furtherance to learned PCIT’s directions as per law in consequential proceedings.

This assessee's appeal is dismissed in above terms. Order pronounced in the open court on 8th Sept., 2021. (L.P. SAHU) (S.S. GODARA) Accountant Member Judicial Member