Best Judgment Assessment, as the name indicates Best Judgment Assessment means the computation of income and tax is undertaken by the Assessing Officer (AO) himself, on the basis of the best of his judgment. The Best judgment Assessment can be made by an AO under the following cases: –
1. Assessee does not file his regular return of income u/s 139.
2. Assessee does not comply with instructions u/s 142 (1), i.e., notice requiring filing his return of income or 142 (2A), i.e., notices requiring assessee to conduct audit of his accounts.
3. Assessee does not comply with instructions u/s 143(2), i.e., notice of scrutiny assessment.
4. AO is not satisfied regarding completeness of accounts.
Since in all of the above cases either assess does not cooperate with the Assessing Officer (AO) or does not file return of income or does not have complete accounts. Thus, the assessing officer cannot calculate the income and therefore, he has to judge the income on the basis of his best assumptions/judgments. The AO must give a hearing to the assessee before completing the assessment as per best of his judgment. No refund can be granted under best judgment assessment.
Related Cases:
S. 144, r/w S. 145 of the IT Act, 1961—Best Judgment assessment—The assessee is engaged in the business of plying of trucks and for the relevant assessment year, Assessing Officer completed the assessment u/s 144 by estimating the income on the basis of order passed by Settlement Commission. However, CIT(A) estimated income per truck at different amount. In absence of books of account, there cannot be any clear-cut and dry formula to estimate the income per truck—CIT vs. S. Harjit Singh
S. 144 of IT Act, 1961, r/w S. 72 of Finance Act, 1997—Best Judgment assessment—It is well settled that while making the best judgment assessment, the assessing Officer should do so on a rational basis and without any bias. When the assessee has brought on record evidence that in the case of a company having similar business, the declared profits were in fact, lower than the profits declared by the assessee, therefore in such circumstances, the net profit as declared by the assessee is not required to be disturbed—CIT vs. Aero Club
S. 144, 254 of IT Act, 1961—Appeal (Tribunal)—Once the returns are treated as non-est, such returns cannot be used even against the assessee. The power of rectification vested u/s 254(2) of the Act is not akin to the power of review. Only an error apparent on the record can be rectified. The Tribunal can rectify its order to the extent that it has no power to place fetters on the Assessing Officer that he should not assess the income at less than the income returned in the “non-est” return but it does not have the power at the same time to incorporate a fresh condition—CIT vs. H.P. State Forest Corporation Ltd. [2010] 320 ITR 54 (HP)
S. 144 of IT Act, 1961—Assessment—In absence of proper explanation to the notice u/s 142(1) of the Act, the investments found in the bank and deposits in the name of the son of the assessee has to be held as unexplained income and for the same additions u/s 144 can be made—Jasbir Singh vs. CIT (2010) 328 ITR 189 (P&H)
Income tax Act, 1961, S. 144—Speaking order—The grounds raised in the appeal are as under. “That the assessment completed u/s 144 is not justified,as such the AO cannot determine the income in the absence of any kind of positive evidence in his hand and if the AO is having any kind of this evidence the same should be confronted to the assessee before using against him. That the order of the ld. CIT(A) was not justified, he has to pass the speaking order on application of S. 144 of the Act, he even not discussed about the application of S. 144 and also not discussed about the submission submitted before him in respect of S. 144″. While allowing the appeal, the ITAT, Jodhpur Bench held that—”Necessity of speaking order has been expressed by the Honorable Apex Court in the case of Kishan lal vs. UOI 230 ITR 85 [SC]. Having regard to the aforesaid judgment and as the order of the Id. CIT(A) is not a speaking order, I set aside his order and restore the matter back to him for adjudicating the issues including the issue of S. 144 taken before me as additional ground afresh by making a reasoned order. Needless to say effective opportunity of being heard shall be allowed to the assessee before taking decision in accordance with law.” Shri Sharvan Beniwal, Bikaner vs. ITO, Ward-I(4), Bikaner [2009] 12 ITCD 229 (ITAT-Jd)
S. 142(1), 143(2), 144 of IT Act, 1961—Assessment—Assessee was filing return regularly in Thane, and therefore, ITO, Pune, has no Jurisdiction, even to issue notice u/s 142(1). However, he can call for information in respect to filing of return or in respect to PAN etc., of a particular assessee. After receiving the required information, if the ITO Pune, feels it necessary, he can send the details to the ITO, who has the Jurisdiction over a particular assessee. Therefore, issuance of notice u/s 142(1) by the ITO Pune is without Jurisdiction. For the assessment u/s 144, the issuance of statutory notice u/s 143(2) is mandatory requirement and, therefore, assessment made u/s 144 without issuing statutory notice u/s 143(2), is null and void and liable to be quashed—Pravin Balubhai Zala vs. ITO [2010] 129 TTJ 373 (MUMBAI)
S. 144, 145(3) of IT Act, 1961—Best Judgment Assessment—Since no specific discrepancies or defects in the books of account of the assessee have been pointed out nor any material brought to establish that purchases are inflated or receipts suppressed, there is no justification in invoking the provisions of S. 145 of the Act. If there was no challenge to the transactions represented in the books, then it is not open to the department to contend that what was shown by the entries was not the real state of affairs and same cannot become basis for rejection of books of account—Dy. CIT vs. Paras Dyeing and Printing Mills P. Ltd. (2010) 4 ITR (Trib) 29 (ITAT-Ahd)
S. 144 & 184 of IT Act, 1961—Assessment—The bar on deduction in respect of salary and interest to partners of a firm does not operate absolutely, and the partners shall on moving their respective Assessing Officers, be entitle to disallow amount (s) being deleted from their taxable income (s), even where return is filed and assessed, in view of the clear provision of S. 184(5), r/w S. 28(v) of the Act. Hence, in absence of any rebutted, or denial the fact of non-compliance of various notices as listed in the assessment order, best judgment assessment is justified—Sai Construction vs. ITO [2010] 127 TTJ 15 (ITAT-Ctk)
S. 144 of IT Act, 1961, r. 46A(3) of IT Rules 1962—Assessment—The Commissioner (Appeal) interfered with the assessment order passed u/s 144 of the Act, by the Assessing Officer relying on the fresh evidence introduced by the assessee before it without providing an opportunity to the Assessing Officer the procedure adopted by the CIT (A) is in violation of rule 46A(3) of It Rules, 1962 and, therefore, order passed by CIT(A) violating the rule of 46A(3) set aside while remanding the matter to the CIT (A) to allow the Assessing Officer an opportunity on the fresh evidence produced by the assessee—Smt. Tijender Kaur vs. CIT (2009) 317 ITR 455 (Gauhati)
Income Tax Act, 1961, S. 144—Best Judgment assessment—Income Tax Rules, 1962- Rule 46A-” This appeal by the revenue against the order dated 28.3.2008 of Ld. CIT(A), Bikaner raises the solitary ground as under: “On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 14,00,000 made by the Assessing Officer u/s 144 of the Act where as the Assessing Officer has categorically established that it is undisclosed income deposited in the bank accounts”. While allowing the appeal for statistical purposes only, the Income Tax Appellate Tribunal, Jodhpur Bench held that:—”The application of the assessee made under Rule 46A of IT Rules, however, was required to be disposed off first before he heard the appeal and decided the same on merits. Having not done that his order has to be set aside. This view finds support from the judgment rendered by Honorable Apex Court in Jyotsna Suri vs. ITAT and others, 179 CTR 265(SC). Accordinngly setting aside the order of Ld. CIT(A), we direct him to first dispose of assessees application made under Rule 46A of IT Rules, 1962 by way of a reasoned order in terms of Sub-rule (2) of Rules 46A of IT Rules, 1962 and thereafter proceed to dispose of the appeal on merits. Needless to say reasonable and effective opportunity of being heard shall be provided to both the parties before taking a decision in accordance with law.” ACIT Circle, Sh.Ganganagar vs. Mohar Singh, Suratgarh [2009] 12 ITCD 23 (Raj.Jodhpur)
S. 144, 158(b), 158BB(1), 158BC, 158BD of IT Act, 1961—Search and seizure—There is a difference between evidence found in the course of search and confirmation of concrete information available before the search. Under the provisions of S. 158BB of the Act, 1961 addition can be made in the course of a block assessment on the basis of evidence found in the course of search and not on the basis of confirmation of a prior knowledge by way of search—Shibu Soren vs. Jharkhand Mukti Morcha Party (2011) 12 ITR (Trib) 540 (ITAT-Delhi)
Income tax Act, 1961, S. 40(b), 144 & 184(5)—Best Judgment Assessment—AO disallowed interest & salary paid to partners while making best Judgment assessment u/s 144. Case was remanded back to the AO. While deciding the appeal in favour of assessee, the ITAT, Amritsar Bench held that:— “We are of the considered opinion that no doubt the AO has completed the same u/s 144 of the IT Act, 1961 after issuing notices to the assessee but the assessee remained absent from the assessment proceedings. The AO invoked S. 184(5) of the Act and disallowed the interest and salary; keeping in view the impugned order at page Nos. 6 and 7, the learned first appellate authority himself narrated the arguments of the learned counsel for the assessee that once assessment is remanded back by the learned CIT(A) to the AO, the original default committed u/s 142 is washed off. The learned first appellate authority has also considered the submissions of the assessee, especially the remand report given by the AO but he held that original default u/s 142 remained intact even if the assessee later on produces books of accounts before the learned CIT(A) or any other authority including the AO. We are of the considered opinion that this observation of the learned first appellate authority is wrong because when the assessee has produced the books of account before the learned first appellate authority or before the AO in a remanded proceeding, the original default u/s 142 does not remain intact because the original assessment has already been set aside by the learned first appellate authority by sending the matter back to the AO and the assessee has produced all books of accounts. After going through the Tribunal’s order and the written submissions filed by the learned Departmental Representative, we are of the considered opinion that this Bench has adjudicated the issue in dispute on 22nd July, 2009 in the case of the ITO vs. Reshi Construction Co. and vice versa in ITA Nos. 462 and 478/Asr/2008, for the asst. yr. 2005-06, vide order dt. 22nd July, 2009 (supra) in which the assessment was also completed u/s 144 of the Act and the AO disallowed the interest and salary to the assessee since the books of account have not been produced before him but later on the assessee produced the same and this Bench had allowed the deduction of interest and salary to the assessee. Keeping in view the facts and the circumstances of the present case, we are of the considered opinion that the issue involved in the present case is squarely covered by the decision of the Tribunal, Amritsar Bench, Amritsar, in the case of the ITO vs. Reshi Construction Co. and vice versa in ITA Nos. 462 and 478/Asr/2008, for the A.Y. 2005-06, vide order dt. 22nd July, 2009 (supra) and respectfully following the same, the addition in dispute is deleted by allowing the ground No. 2. ” Jee Enn Engineers vs. ITO [2010] 15 ITCD 69 (ITAT-Amritsar)
S. 144 & 184(5) of IT Act, 1961—Assessment—Return filed by the assessee long after the time available for this purpose is non est and, therefore, the assessment has to be made u/s 184(5) treating the assessee as AOP—V.K. Kamat Bros. & Ors. vs. ITO [2010] 228 CTR 290 (Bom)
S. 144 of IT Act, 1961—Assessment—Recourse to affixture of notice cannot be straightaway without first taking other modes of service. Hence, in such manner, the services of notice by affixture is not proper service and consequently, assessment made u/s 144 of the Act on such invalid service of notice is also not valid—CIT vs. Kishan Chand (2010) 328 ITR 173 (P&H)
S. 142, 143(2) 144 & 148 of IT Act, 1961—Reassessment—An assessee can file a return beyond the time prescribed in the notice issued u/s 148 moreover, the revenue cannot invoke S. 139(4) saying that the return is invalid because S. 139(4) speaks of notice u/s 142(1) but does not refer to notice u/s 148. The explanation makes evidently clear that notice u/s 143(2) is required to be issued within the stipulated period. In case, no such notice is issued then the assessment cannot be treated invalid. Assessment u/s 144 can be made if the assessee fails to comply with all the terms of notice issued u/s 142(1) of the Act. Since the assessment has been made u/s 143(3) without issuing notice u/s 143(2) after the receipt of return in response to notice u/s 148, the assessment order is not valid and same is void ab initio—H. Gouthamchand vs. Addl. CIT (2010) 131 TTJ 204 (ITAT-Bang)
S. 144 of IT Act, 1961—Best Judgment assessment—The assessee is engaged in the business of running a bar hotel and during survey, the Department recovered certain books, price list, etc. Statement were also recorded from the managing partner, manager and also supplier all of whom have confirmed that accounts written are not full and complete and do not reject the actual receipt on sale. Therefore, the Assessing Officer made a best judgment assessment u/s 144 of the Act. When the contents of the documents seized are proved through corroborative evidence of the managing partner, manager and the suppliers, there is no reason to reject them. A statement recorded u/s 133A(3)(iii) of the Act, cannot be treated as independent evidence like evidence recorded u/s 132(4), and it has corroborative value in assessment and can be even relied on by the assessee. The gross profit rate estimated by the Tribunal in the first round at 40 per cent. for the on one assessment year can be applied for the all three years in question—CIT vs. Hotel Samrat (2010) 323 ITR 353 (Ker)
S. 143(2), 144 of IT Act, 1961—Assessment—The notice u/s 143(2) or S. 142(1) were sent through speed post and none of the notices were received back. Therefore, in the absence of any contrary evidence brought on record by the assessee, it has to be presumed that the notices have been served on the assessee—Manoj Kumar Jain vs. ITO (2012) 13 ITR (Trib) 227 (ITAT-Delhi)
S. 40(b), 44AD, 68, 69A, 144, 145(3) of IT Act, 1961—Business expenditure—If the remuneration is paid to the partner who is not a working partner then the remuneration even payable in accordance with the partnership deed is not allowable u/s 40(b) of the Act—Reliable Surface Coatings vs. ACIT (2011) 7 ITR (Trib) 183 (ITAT-Ahd)
S. 143(2), 144 & 147 of IT Act, 1961—Reassessment—In a case where return is filed and the Assessing Officer is not satisfied with the return so filed and he also proceeds to make the assessment, then unless notice u/s 143(2) is issued, assessment cannot be validly framed. The issue and service of notice u/s 143(2) is not a procedural irregularity and the same is not curable and the requirement to issue notice u/s 143(2) cannot be dispensed with. If notice u/s 143(2) is not issued and return filed by the assessee has been tinkered, the absence of notice u/s 143(2) will invalidate the assessment proceedings and consequently, the assessment is also invalid and void ab initio—DCIT vs. Ms. Mayawati (2011) 135 TTJ 274 (ITAT-Delhi)
S. 144, 147, 148 of IT, Act, 1961—Reassessment—There is conceptual difference between the power to review and the power to reassess. The Assessing Officer has no power to review and he has only power to reassess. Reassessment has to be based on fulfillment of certain precondition and if the concept of change of opinion is removed, then in garb of reopening of the assessment, review would take place. One must treat the concept of change of opinion as an in-built test to check abuse of power by the Assessing Officer. Hence, reassessment based on change of opinion of succeeding Assessing Officer is not valid in law—H.K. Buildcon Ltd. vs. ITO (2011) 339 ITR 535 (Guj.)
S. 144 of IT Act, 1961—Assessment—The course of events show that the assessee was not given sufficient opportunity by the Assessing Officer and CIT(A) and, therefore, while setting aside the orders of the authorities below the matter was remanded to Assessing Officer for consideration de novo—Pilot Cabs and Tours vs. ITO (2012) 13 ITR (Trib) 123 (ITAT-Chennai.)
S. 144, 153A, 153C & 292C of IT Act, 1961—Search and seizure—Assessment cannot be framed merely on extrapolating theory i.e. discrepancies in respect of items must have existed in other years or other instances or projects unless a definite trend of malpractice is conclusively proved by substantial evidence on record. In this case assessee was following project completion method of accounting and projects against which the assessee received on-money were not complete during A.Y. 2008-09, and the assessee himself had suo motto offered entire alleged receipts for on money in its return of income filed u/s 153C for the said assessment year and, therefore, under such circumstances no further addition on that account is warranted—Fort Projects (P) Ltd. vs. DCIT (2012) 145 TTJ 340 (ITAT-Kol.)
S. 143(3), 144, 153 and 153(2A) of IT Act, 1961—AY 1989-90 to 1991-92—Assessment— When the Consequential order becomes in fictitious and is non est in the eye of law, the question of application of S. 153(2A) or S. 153(3)(ii) does not arise. But if a fresh assessment order is required to be made in consequence to any order of DC(Appeal), then clearly the time limit prescribed u/s 153(2A) would apply.
Income Tax Act, 1961, section 144—Best judgment assessment—Assessee challenged that the Income tax Authorities wrongly held that appellant has shown bogus purchases, and the books of accounts were wrongly rejected. While dismissing the Civil Appeal, the Supreme Court held that:—“It is well settled that in a best judgment assessment there is always a certain degree of guess work. No doubt the authorities concerned should try to make an honest and fair estimate of the income even in a best judgment assessment, and should not act totally arbitrarily, but there is necessarily some amount of guess work involved in a best judgment assessment, and it is the assessee himself who is to blame as he did not submit proper accounts. In our opinion there was no arbitrariness in the present case on the part of the Income Tax Authorities. Thus, there is no force in this appeal, and it is dismissed accordingly.”
S. 144, 256 of the IT Act, 1961—Assessment—Assessment order passed without affording proper opportunity to the assessee meant denial of principal of natural justice therefore, such assessment order cannot sustain in eye of law—Hans Raj Kumar vs. CIT.
S. 144 of the IT Act, 1961—Best Judgment Assessment—Where the Assessing Officer has adopted Net Profit rate in making assessment on best judgment assessment basis, even in that case allowance of depreciation is required to be made—Shri Ram Jhanwar Lal vs. ITO (Raj)
S. 143(2) & 144 of the IT Act, 1961—Assessment—In absence of compliance of mandatory requirement of service of notice u/s 143(2) upon the assessee or its authorised person, assessment order passed by AO is not proper and valid under law—ACIT vs. Kewalchand Dakalia (2009) 121 TTJ 273 (ITAT-Jd)
S. 144, 184(5) & 185 of the IT Act, 1961—Firm—Since there is failure on the part of the assessee in filing the return referred to in clause (a) of S. 144, ‘AOP’ not in the S. 184(5) is attracted and assessable in the status of ‘AOP’ not in the status of a “firm”—Mubarak Trading Company vs. CIT (2009) 222 CTR 194 (Ker)
S. 131, 142, 142A, 144, 145 of the IT Act, 1961—Assessment—As per S. 144 read with S. 145, 142A and 131(1)(d) it is not mandatory for the Assessing Officer to reject the books of account first before making reference u/s 131(1)(d) of the Act or calling for a report of the valuer u/s 142A. S. 12A of the Act gives full powers to the Assessing Officer to call for a report from Valuation Officer—CIT & Anr. vs. Bhawani Shankar Vyas (2009) 311 ITR 8 (Uttrakhand)
Income Tax Act, 1961, sections, 142, 144 and 185—Grant of registration—The following question of law was framed:—”The Tribunal was justified in affirming order passed by CIT (Appeals) setting aside the order passed by the Assessing Officer u/s 185(5) refusing to grant registration to the respondent-firm and treating the assessee firm as URF?” While dismissing the appeal, the Rajasthan High Court held that:—”(1) We may hasten to make it clear that we should not be understood to mean, that apart from the existence of one of the eventualities contemplated u/s 185 (5), something more is required to exist, to clothe the authority with the jurisdiction to decline registration, what we mean to hold is, that notwithstanding existence of the eventualities, the provision does confer discretion on the authority, and provision does not provide refusal of registration, as an automatic consequence of the existence of the eventualities. The difference is required to be better appreciated and applied. (2) If the present case is considered on these lines, it is more than clear, that in the present case, the assessee, in response to the notice, did submit reply and projected his difficulty. What is significant to note is, that it is not shown to us, that the difficulty projected by the assessee, by way of reply, was turned down, as being not reliable, or not sufficient, rather simply by noticing the fact, about the assessee having submitted reply, the order u/s 185 (5) was passed, and assessment was made u/s 144, which in our view, has rightly been set aside by the learned tribunal.” Cit, Jodhpur vs. Udai Mohan & Company [2007] 7 ITCD 189 (Raj.)
S. 144 of the IT Act, 1961—Best Judgment Assessment—Where the Assessing Officer has adopted Net Profit rate in making assessment on best judgment assessment basis, even in that case allowance of depreciation is required to be made—Shri Ram Jhanwar Lal vs. ITO [2010] ITR 400 (Raj.)
S. 142(3) & 144 of IT Act, 1961—Assessment—As per S. 144, inter alia, if a person fails to comply with the terms of a notice u/s 143(2), the Assessing Officer after taking into account all the relevant material gathered by him, after providing of proper opportunity of being heard, make the assessment to the best of his judgment and it is incumbent on the Assessing Officer to confront the assessee with evidence gathered against him before passing the assessment order using that evidence against the assessee—Harjinder Singh vs. ITO [2010] 122 ITD 476 (Asr)
S. 144 of IT Act, 1961—Assessment—Assessee executed a sale deed in favour of M/s. McDowell and Co. Ltd. for sale of 3 acres of land together with building constructed thereon for certain amount and entered into another agreement granting the right of ingress and egress between the schedule property and the nearest road. In course of assessment u/s 144 said sale deed is composite and amount received is long-term capital gain—Endeavour Estates Pvt. Ltd. vs. ACIT (2009) 316 ITR 250 (Karn)
S. 144 of IT Act, 1961—Assessment—Assessee filed the return of income which was processed u/s 143(1)(a) and thereafter on scrutiny of the case, assessment was made u/s 144 thereby additions came to be made the income of assessee. Tribunal remanded the matter to the Assessing Officer with a direction to frame the assessment de novo after allowing the assessee to produce computerized accounts and making necessary inquiries and verification. Since no prejudice is cause to the assessee, therefore, there is no infirmity in Tribunal order—Pusham Bansal vs. CIT (2009) 316 ITR 256 (P&H)
S. 144B of IT Act, 1961—Assessment—When depreciation is not claimed, it cannot be ‘allowed’ when the original return is withdrawn and a revised return is filed, there is no basis on which depreciation can be taken note of. Since there is no variation in two returns, viz., the assessee’s revised return and the Income-tax Officer’s proposed assessment order and both shows ‘nil’ income and, therefore, S. 144B cannot be invoked—Southern Petrochem Industries Corpn. Ltd. vs. ITO (2009) 316 ITR 292 (Mad)
S. 29, 144, 145 of IT Act, 1961—Accounting—Where the Assessing Officer is not satisfied with the correctness or completeness of the books, he may reject them and estimate the income to the best judgment in accordance with the provisions of S. 144 of the Act. When an estimate is made to the best judgment of an Assessing Officer, he substitutes the income that is to be computed u/s 29 of the Act. Best judgment assessment is made by fixing a rate of net profit. Net profit is applied after taking into consideration all factors and it accounts for all the deductions which are referred to u/s 29 and are deemed to have been taken into consideration while making such an estimate—CIT vs. Gian Chand Labour Contractors (2009) 316 ITR 127 (P&H)
S.144C of IT Act, 1961—Dispute resolution penal, reference to—The DRP without following any of the mandatory provisions contained in the law before disposing of the reference place before it u/s 144C of the Act by a non speaking order, such order is liable to be quashed and set aside.—Ford India (P.) Ltd. vs. DCIT [2013] 140 ITD 171 (ITAT-Chennai)
S. 139(2), 139(9) & 144 of IT Act, 1961—Assessment—When the assessee filed a defective return, and did not rectify the defects which were pointed out by the ITO, the Assessing Officer is bound to treat the return of income as invalid and take further proceedings on the footing that the assessee has failed to furnish the return. The assessing authority cannot proceed to make ex-parte assessment u/s 144 without serving notice u/s 139(2) or as the case may be u/s 148 of the Act.—CIT vs. Bake food Products (P.) Ltd. [2013] 259 CTR 136 (AP)
S. 144A, 147, 148 of IT Act, 1961—Reassessment—Under s. 144A, the joint Commissioner has been granted discretion to issue directions to guide the Assessing Officer to enable him to complete the assessment but such directions are also binding on such officer. When the department had failed to take any step to revise the order passed under s. 144A by invoking the provisions of s. 263, the notice issued under s. 148 by the Assistant Commissioner cannot be sustained.—Amrit Sales Promotion Pvt. Ltd. Vs. UOI. [2013] 353 ITR 68 (CAL)
S.140, 143(3) & 144C of IT Act, 1961, r.4 of IT (Dispute Resolution Panel) Rules, 2009—Appeal—There is no prescription that the objection should be filed by the assessee in person. Under rule 4 of the IT (DRP) Rules, 2009, objection, if any, may be filed in person or through his agent within specified period in Form 35A. An agent is permitted to file the objection, but in the case of company whether the agent is to be a managing director, director, chartered accountant or any other person has not been prescribed under the 2009 rules but rule 3(a) of rule 2009 says that draft order copies can be duly authenticated by the eligible assessee or his authorized representative.—Nomura Services India P. Ltd. vs. ITO [2012] 20 ITR (Trib) 745 (ITAT-Mum)
S. 144C of IT Act, 1961—Dispute Resolution Panel—The administrative authorities having a duty to act judicially cannot decide on considerations of policy or expediency. They must decide the matter solely on the facts of the particular case, solely on the material before them and apart from any extraneous considerations by the applying pre-existing legal norms to factual situations. Necessity of giving reasons is an important safeguard to ensure observance of the duty to act judicially. Non speaking order of Dispute Resolution Panel is unsustainable and quashed with order of remand of fresh consideration.—Panasonic Consumer India Pvt. Ltd. vs. ACIT. [2013] 22 ITR (Trib) 390 (ITAT-DELHI)
S. 144, 154 of IT Act, 1961—Writ Jurisdiction—A contention which was not argued before the statutory authorities and which the authority had no occasion to deal with, cannot be allowed to be raised for the first time before High Court.—P.P. Abdul Khader and Co. vs. CIT [2013] 351 ITR 17 (KER)
S. 144C of IT Act, 1961—Transfer Pricing—When a quasi-judical authority like the Dispute Resolution Panel Deals with S. 144C of the Act then it is obligatory on its part to ascribe cogent and germane reasons as reasons are that the heart and soul of the matter and facilitate the appreciation of the order when the order is called in question either before a superior forum or an appellate forum. When it was an admitted position on record that in support of its comparables various assertions and facts were made, which were not dealt with by the Dispute Resolution Panel, its order is liable to be set aside—Dorling Kindersley India Pvt. Ltd. [2013] 24 ITR (Trib) 686 (ITAT-DELHI)
Section 144 Income-tax Act, 1961–Best judgment assessment –Malik Packaging vs. CIT.
Section 144 of the Income-tax Act, 1961–Best judgment assessment–CIT vs. Friends Briquettes Industries.
Section 144 of the Income-tax Act, 1961–Best judgment assessment–Kachwala Gems vs. JCIT.
Section 144 of the Income-tax Act, 1961–Best judgment assessment–Malu Khan Mahendra Singh Yasin Khan & Party vs. DCIT.
Reference: –
As Per 144 of the Income Tax Act 1961
Best judgment assessment.
- [(1)] If any person—
(a) fails to make the return required [under sub-section (1) of section 139] and has not made a return or a revised return under sub-section (4) or sub-section (5) of that section, or
(b) fails to comply with all the terms of a notice issued under sub-section (1) of section 142 [or fails to comply with a direction issued under sub-section (2A) of that section], or
(c) having made a return, fails to comply with all the terms of a notice issued under sub-section (2) of section 143,
The [Assessing] Officer, after taking into account all relevant material which the [Assessing] Officer has gathered, [shall, after giving the assessee an opportunity of being heard, make the assessment] of the total income or loss to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment :
Provided that such opportunity shall be given by the Assessing Officer by serving a notice calling upon the assessee to show cause, on a date and time to be specified in the notice, why the assessment should not be completed to the best of his judgment :
Provided further that it shall not be necessary to give such opportunity in a case where a notice under sub-section (1) of section 142 has been issued prior to the making of an assessment under this section.
(2) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year.