KAMADEV BEHERA,KHURDA vs. NATIONAL FACELESS ASSESSMENT CENTRE,DELHI, DELHI

It was submitted by the Ld. AR that all the details have been produced before the Ld.CIT(A) and the AO and that the details have been provided before the Ld.PCIT. It was submission that the Ld. PCIT has not set aside the assessment order and, therefore, order u/s.263 of the Act is liable to be quashed. It was submission that the assessee is only a dealer in banana and the transactions are all by cheque. It was submission that in the original assessment order, the AO had estimated the income of the assessee at 8%, but the Ld. PCIT has asked the AO to examine the sources of the cash deposits, which has remained unverified and to apply the provisions of section 69A and 115BBE of the Act. It was submission that as all the transactions were by cheque, the assessee should not be harassed with order u/s. 263 of the Act. It was the submission that order u/s.263 of the Act is liable to be quashed.

In reply, Ld. CIT DR submitted that in the course of original assessment order, the assessee had submitted that the assessee was unaware of the Income tax provisions then within the one month the assessee had got its account audited and had also filed its return of income. It was further submissions that the assessee has non-cooperative in the assessment proceeding. It was the submission that the said led to estimated additions being made. It was the submission that the Ld. PCIT had examined the records and had found that the AO had not done the verification as per required to be verified and the sources of the cash deposits were not examined. It was the submission that the order u/s.263 of the Act is liable to be upheld.

We have considered the rival submissions. A perusal of the facts in the present case clearly shows that the in the course of original assessment proceedings multiple opportunities have been given by AO to the assessee. The first notice was issued as early as on 27.08.2021. There has been no cooperation at all from the assessee’s side. Nothing has been produced in the course of assessment proceedings and in response to a show cause notice issued by the AO on 24.02.2022, the assessee has filed a letter which has been extracted by the AO in his assessment order even in that the documents or details called for by the AO had not been produced. Admittedly, this has resulted into the AO being compelled to pass an ex-parte order estimating the income of the assessee by rejecting the books of accounts of the assessee. A perusal of the order passed u/s. 263 of the Act shows that the certain documents were produced before the Ld. PCIT in the 263 proceedings. The documents produced also substantiated the claim raised by the Ld. PCIT in the show cause notice that there are issues which required examination which have not been verified by the AO, admittedly, because of the failure on the part of the assessee to provide the details before the AO. These evidences were also coming out of the audit report filed along with the alleged return delayed. The act of the assessee is nothing but contumacious conduct denying the AO the opportunity to complete the assessment in the process that it is required to be done. Now, when the ld. PCIT has brought out the issues that required to be verified the assessee is raising allegations in respect of the claims that documents had been produced and the PCIT did not have the power u/s. 263 of the Act to direct for verification. This is not permissible.