SHANMUGANATHAN RAJASEKARAN,COIMBATORE vs. THE PRINCIPAL COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE, COIMBATORE, COIMBATORE

There is a delay of 183 days in filing the appeal by the assessee. The assessee has filed condonation petition/affidavit stating the reasons for delay in filing the appeal. We have considered the Shanmuganathan Rajasekaran

The grounds of appeal raised by the assessee are as under: 1. The order of the Learned Principal Commissioner of Income Tax u/s 263 of the Income Tax Act, 1961 is erroneous on the facts of the case and contrary to the provisions of law.

The order of revision u/s 263 is without juri iction and unsustainable in law, as the base assessment order passed u/s 143(3) itself is void ab initio and bad in law since the assumption of juri iction by the Assessing Officer is vitiated in the absence of valid notice U/s 143(2).

The order of Revision U/s 263 is without Juri iction and unsustainable in law, as the Assessing Officer has examined the issues on which the case was picked up for scrutiny.

On the facts and circumstance of the case, the revision order passed under Section 263 is bad in law as the revision order was passed at the instance of Audit Objection which does not come under the provision Explanation 1(b) of Section 263(1).

On the facts and circumstance of the case, the Ld.PCIT initiated the proceedings in response to the proposal sent by the AO to set aside the assessment order and initiate proceedings u/s 263 of the Act, is not legally valid.

On the facts and circumstance of the case, the Learned PCIT has not appreciated the fact that the appellant regularly filing the Income Tax returns by claiming the expenditure from the consultancy charges for several years and accepted by the department in earlier years. Accordingly Learned PCIT is not justified in invoking the provision of Section 263 without following the rule of consistency.

On the facts and circumstance of the case, Learned PCIT has not done any enquiry while passing the order under Section 263 which is against the provisions of law. Shanmuganathan Rajasekaran

On the facts and circumstance of the case, the Learned PCIT failed to establish how the Assessment order Passed U/s 143(3) is erroneous and prejudicial to the Interest of the revenue.”

The assessee is an Orthopedic Surgeon specializing in Trauma and accident surgery, joint replacement etc. and is one of the Directors of Ganga Medical Centre and Hospital Pvt. Ltd, Coimbatore. The assessee has filed return on income on 29.12.2020 declaring total income of Rs. 50,79,56,840/-. The return was selected for scrutiny under CASS for verification of the following: 1) The income from house property; 2) Deduction from total income under Chapter-VIA. 4.1 Accordingly, the A.O issued notice u/s. 143(2) of the Act on 29.06.2021 specifying the two issues on which further clarification was required initially. The assessee uploaded the reply on 29.06.2021 uploading six PDF documents. The A.O as a follow up issued notice u/s. 142(1) of the Act on 18.11.2021 directing for further details such as business activities carried out in different segment on its bank accounts, details of computation of income and all other Annexures of audit report along with audit note Form-3CD, details of house property income and details regarding deduction claimed under chapter-VIA. The assessee submitted the reply on 18.11.2021, and further notice u/s. 142(1) was issued on 11.12.2021, and the assessee uploaded Shanmuganathan Rajasekaran

2 Subsequently, the A.O sent a proposal to Ld. PCIT on 20.12.2023 referring to the revenue audit objections raised vide No.OBS-848161 dated 25.09.2023 reproducing revenue audit objections on the issue of disallowances u/s. 14A of the Act and on the claim of expenditure of Rs. 46,96,10,933/- out of receipt from Ganga Medical Centre and Hospital to revise the assessment order u/s. 263 of the Act holding it erroneous and prejudicial to the interest of revenue. The Ld. PCIT on 04.01.2024 issued a show cause notice to the assessing to revise the assessment order under section 263 of the Act , for assessment order being erroneous and prejudicial to the interest of revenue on the two issues raised in the audit objections . The assessee in response to show cause issued has explained that Department of Orthopedic surgeon is headed by him and unit consist Shanmuganathan Rajasekaran