9911796707
TMI Blog2004 (2) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... allowing the standard deduction under s. 16(i) of the IT Act. 4. Rival contentions have been heard and record perused. 5. The brief facts of the issue are that while passing the order under s. 143(3) the AO adopted the income declared by the assessee as it is, and thereafter he made addition on point of accrued interest and unexplained expenditure under s. 69C. Thus, there is no mention in the assessment order regarding salary income being received by the assessee and on which standard deduction has been claimed in the computation of income. It seems that while allowing deduction under s. 16(i) the AO has not considered the eligibility criteria for allowing standard deduction while computing the taxable income from salary. The CIT there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of Orissa High Court while making the assessment and to allow reasonable opportunity of being heard to the assessee while making fresh assessment. 6. Aggrieved by the above order of CIT under s. 263, the assessee approached us for further adjudication. 7. It was vehemently argued by learned senior Authorised Representative that the assessee was a renowned technocrat and in all the earlier years, standard deduction claimed was allowed even while framing assessment under s. 143(3). He further submitted that there is no change in the facts and circumstances of the case so as to make a ground for the Revenue to deviate from the decisions already taken in the earlier years. He drew our attention to the assessment orders for the asst. yrs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e furnished now before the Bench, the decision of the CIT under s. 263 could be otherwise. Thus, according to learned Departmental Representative, the facts were not properly explained before the CIT so as to persuade him for allowing assessee's claim for standard deduction in respect of salary income received by him in the capacity of managing director. 9. Learned senior Departmental Representative further submitted that while passing the order under s. 143(3) the AO has not applied his mind nor stated the reasons for allowing standard deduction which rendered AO's order erroneous so as to empower CIT to take action under s. 263. According to learned Departmental Representative allowing assessee's claim for standard deduction without rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO being erroneous as well as prejudicial to the interest of Revenue. Careful perusal of the AO's order passed under s. 143(3) clearly indicates that he has blindly adopted the income as computed by the assessee. He has not uttered a single word regarding justifiability of assessee's claim of standard deduction nor has stated any fact regarding employer and employee relationship of the assessee in respect of salary income received by him. Thus, there is gross failure of AO to make necessary inquiry which rendered the AO's order to be erroneous. The AO has not verified the assessee's claim by referring to investigate into the articles of association or the board resolution. Even before the CIT, the assessee has not mentioned regarding v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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