2023 (6) TMI 1164 - AT - Income Tax

Validity of order u/s 263 - Failure of the AO of examine the income properly - interest on LIC pension and interest from compensation from land acquisition - HELD THAT - PCIT examined the issue raised in the show-cause notice and observed that a TDS u/s 194LA was deducted on the payment of compensation on acquisition of land paid to assessee - The findings of the PCIT given in para 6 of the impugned order states that the above referred two issues i.e. interest on LIC pension and interest from compensation from land acquisition has not been dealt by the Assessing Officer and has not raised any enquiry about the same. We find merit in the finding of the PCIT since in the assessment order, there is no discussion about the above referred two incomes nor the assessee had filed any details before the PCIT. Even, before us in the present appeal, no paper-book has been filed and the assessee has not appeared on any of the given dates which shows that the assessee has no material evidence to rebut the findings of the PCIT. We, thus, considering the facts of the case, hold that the PCIT rightly held the order of the AO u/s 143(3) of the Act as erroneous and prejudicial to the interest of Revenue as the AO failed to examine the issue relating to interest on LIC pension and income from land acquisition. Thus, we confirm the order of the PCIT framed u/s 263 of the Act and dismiss all the grounds of appeal raised by the assessee.

Summary

Issues involved:
The judgment involves the condonation of delay in filing an appeal due to the Covid-19 pandemic and restrictions on movement. It also addresses the challenge to the validity of an order under section 263 of the Income Tax Act, 1961.

Condonation of Delay:
The appeal was found to be time-barred by 66 days, but considering the impact of the Covid-19 pandemic, the delay was condoned as the assessee was prevented from filing the appeal in time due to sufficient cause. The appeal was admitted for adjudication after the delay was condoned.

Validity of Order under Section 263:
The assessee challenged the validity of the order under section 263 of the Act, claiming it to be bad in law. The Principal Commissioner of Income Tax (PCIT) concluded that the Assessing Officer failed to examine issues related to interest on LIC pension and income from land acquisition. The PCIT held the order under section 263 as erroneous and prejudicial to the interest of Revenue. The Tribunal confirmed the PCIT's order and dismissed all grounds of appeal raised by the assessee.

This judgment highlights the importance of timely filing of appeals, the impact of the Covid-19 pandemic on legal proceedings, and the authority of the PCIT to revise orders under section 263 of the Income Tax Act.