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2015 (3) TMI 1319 - AT - Income TaxNon maintaining books of accounts - AO estimating the income of the assessee by applying net profit rate in the assessment order passed u/s 143(3) without invoking the provisions of s. 145(3)- best judgment assessment under s. 143(3) without invoking the provisions of s. 145(3) of the Act instead of making assessment under s. 144 - Held that:- The assessee has not complied with the two situations mentioned in s. 144 the assessee has not complied with the provisions of s. 142(1) where the assessee has failed to produce accounts, documents, information and statement of assets and liabilities. Secondly, having made a return filed and fails to comply with all the terms of a notice issued under s. 143(2) and moreover, as per proviso to s. 144, no show-cause notice for making ex parte assessment under s. 144 has been issued to the assessee. AO was required to make best judgment assessment under s. 144 of the Act, which in fact, has not been made. AO proceeded to make assessment under s. 143(3) of the Act on the premise that the assessee has submitted some details and explanations called for which in fact have not been furnished is a matter of record. Such assessment made under s. 143(3) is liable to be quashed. We accordingly, direct the AO to quash the assessment so made by the AO. Even if the assessment has been made under s. 143(3) or in a manner provided under s. 144 of the Act, the AO should have invoked the provisions of s. 145(3) of the Act, which has not been done. In the facts and circumstances of the case also, the assessment made by the AO is bad in law and is directed to be quashed. - Decided against revenue
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