Eyegear Optics India Private Limited Vs DCIT (ITAT Hyderabad)
ITAT Hyderabad held that it is not obligatory on the part of the CIT(A) to set aside all the best judgment assessment orders passed u/s 144 of the Income Tax Act to the file of the AO. CIT(A) is obligated to address the grievance of validity of jurisdiction assumed by AO for initiating reassessment proceeding.
Facts- AO based on information that the assessee company had debited an amount of Rs.4.17 crores (Approx.) towards referral fees paid to doctors, which was not an allowable expenditure u/s 37(1) of the Act, reopened its case u/s 147 of the Act. Notice u/s 148 of the Act dated 31.03.2019 was duly served upon the assessee company. However, the assessee company failed to file its return of income in compliance to the aforesaid notice. As the assessee company had neither filed its return of income nor complied with the notices that were issued by the AO, therefore, the latter was constrained to frame the assessment to the best of his judgment u/s 144 of the Act. Accordingly, the AO vide his order passed u/s 144 r.w.s 147 of the Act dated 16.12.2019, after disallowing the assessee’s claim for deduction of referral fees paid to doctors of Rs.4.17 crores determined its income at Rs.16,91,181/ -.
