/S NEMAM SEERALN JAGANNATHAN,THIRUVALLUR vs. ITO,WARD-2, THIRUVALLUR

This appeal filed by the assessee is directed against the order of the ld. Principal Commissioner of Income Tax, Chennai-1, Chennai, dated 29.03.2022 relevant to the assessment year 2017-18 passed under section 263 of the Income Tax Act, 1961 [“Act” in short].

Brief facts of the case are that the assessee filed his return of income for the assessment year 2017-18 on 06.03.2018. The return filed by the assessee was initially processed under section 143(1) of the Act and subsequently, the case was selected for scrutiny under CASS. After following due procedures, the assessment was completed under section 143(3) of the Act dated 27.12.2019 by accepting the income returned by the assessee.

By invoking the provisions of section 263 of the Act, the ld. PCIT issued notice dated 21.03.2022 calling for explanation from the assessee as to why the assessment order passed under section 143(3) of the Act dated 13.12.2019 should not be set aside since the assessment order was found to be erroneous and prejudicial to the interest of the Revenue and posted for hearing on 23.03.2022 at 4.00 P.M. and hurriedly concluding the revision order under section 263 of the Act dated 29.03.2022 and directing the Assessing Officer to redo the assessment.

On being aggrieved, the assessee is in appeal before the Tribunal.

We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. It is amply clear from the revision order that notice under section 263 of the Act dated 21.03.2022 has been issued and posted the case for hearing on 23.03.2022. From the above short-notice of hearing fixed by the ld. PCIT, we find that the ld. PCIT has not afforded sufficient time to the assessee for filing his reply before him and the same is against the principles of natural justice. Accordingly, we set aside the revision order passed under section 263 of the Act and remit the matter back to the file of the ld. PCIT with a direction to afford reasonable opportunity of being heard to the assessee for substantiating his case.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 28th February, 2023 at Chennai.