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TMI Blog2024 (3) TMI 519X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment proceedings. PCIT observed that the details of the sub-contracts given by the assessee company have not been called for by the AO to verify the genuineness of the sub-contractors and the claims of the assessee in this regard were accepted by the AO in a perfunctory manner without any inquiry or verification. Therefore, we have no hesitation to come to a conclusion that the Ld.PCIT has rightly initiated the proceedings u/s 263, saying that the assessment order passed by the AO is erroneous and prejudicial to the interest of the revenue. Appeal of the assessee is dismissed. - Shri Duvvuru Rl Reddy, Hon ble Judicial Member And Shri S Balakrishnan, Hon ble Accountant Member For the Appellant : Shri G.V.N.Hari, AR For the Respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Ld.PCIT further observed from the sworn statements of the above persons recorded before the DDIT(Inv) that these persons denied to have any knowledge of the above transactions and stated that Shri M.Dharma Rao, Managing Director of the assessee company had made all these transactions without their knowledge and had taken their signatures on blank cheques. On cross examination of Shri M.Dharma Rao by the DDIT(Inv), he replied that the said persons were sub-contractors of the company and they have given statements against him out of personal rivalry. The DDIT(Inv) further reported that other claimed sub-contractors namely Sri Adibhatla Bhaskara Rao, Sri Yegireddy Madhusudhan Rao and Sri S.Mohan Rao have not responded to summons issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of sub-contractors and reasons for low profit, the revision proceedings initiated u/s 263 are to be dropped, the Ld.PCIT held that the contentions of the assessee are not acceptable since the AO has called for the reasons for low profit only and he has never verified the genuineness of sub contract payments or made enquiries in this regard at any stage of the assessment proceedings. The Ld.PCIT further held that the claim of the assessee was accepted by the AO without making any inquiries and verification in this regard, which the AO should have been made when the sub-contract expenditure claimed by the assessee is so huge and glaring to arrive at a conclusion on the genuineness of sub-contract charges. The Ld.PCIT further held that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned Commissioner of Income Tax is not justified in assuming jurisdiction u/s 263 of the Act in as much as the assessment order u/s 143(3) dated 18.09.2014 for the A.Y.2012-2013 is neither erroneous nor prejudicial to the interests of revenue. 3. The learned Commissioner of Income Tax is not justified in directing the assessing officer to redo the assessment to verify the correctness and genuineness of the sub-contract charges of Rs. 25.72 crores claimed by the appellant as expenditure. 4. The learned Commissioner of Income Tax ought to have appreciated that the assessing officer initiated enquiries in respect of the above issues and as such it is not a case of lack of inquiry to enable the learned Commissioner of Income Tax to invoke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de to the sub contractors during the assessment proceedings. The Ld.PCIT observed that the details of the sub-contracts given by the assessee company have not been called for by the AO to verify the genuineness of the sub-contractors and the claims of the assessee in this regard were accepted by the AO in a perfunctory manner without any inquiry or verification. Therefore, we have no hesitation to come to a conclusion that the Ld.PCIT has rightly initiated the proceedings u/s 263, saying that the assessment order passed by the AO is erroneous and prejudicial to the interest of the revenue. Hence, all the grounds raised by the assessee are liable to be dismissed. Accordingly, we dismiss the appeal filed by the assessee. 7. In the result, app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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