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TMI Blog2023 (12) TMI 395X X X X Extracts X X X X X X X X Extracts X X X X ..... NeAC) has been framed after considering the decisions of Assessment orders, Appeal Orders, ITAT orders, High Court order of past several years and also by making required inquiries and verification by team of Assessing Officers of Regional e-Assesment Centers (ReAC):Assessment Unit, Technical Unit, Review Unit, Verification Unit and the NeAC has examined draft Assessment order in accordance with the risk management strategy specified by the Board; and the Assessment Order of NeAC is not erroneous in so far it is prejudicial to the interest of the revenue. 2 The order u/s 263 is factually and legally incorrect in view of observations and findings of the Commissioner of Income-tax (Exemption) that: - (a) NeAC has failed to "make requisite enquiries and verification and enquiries" (b) treating the Indian International Centre (IIC) as a commercially run hotel without appreciating fact that providing venues for seminar, art exhibitions, conferences etc. for advancement of cultural, educational and intellectual activities and providing hostel accommodation and catering activities on loss or no profit-no loss, are as basic to the activities of IIC as is for any educational instit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd hence the ld. AO ought not to have departed from the earlier stand taken by his predecessor for Asst Year 2017-18. b) From the detailed questionnaire issued by the ld. AO along with notice u/s 142(1) of the Act, no query was raised with regard to applicability of proviso to section 2(15) of the Act for the assessee in Asst Year 2018-19. 4. Accordingly a show cause notice was issued u/s 263 of the Act by the ld. PCIT on the aforesaid two grounds. The ld. PCIT also asked the assessee to explain the various details of receipts in Asst Year 2018-19 with specific reference to applicability of proviso to section 2(15) of the Act for the said receipts. The assessee filed its reply vide submissions dated 24.06.2022 by specifically stating that specific enquiries were made by the ld. AO on the same issue. It was also submitted that the assessment framed was by Faceless unit after review by more than one authority at various stages. 5. The ld. PCIT stated in tabular form in Para 4.1. of his order that though the assessee had succeeded on all the issues on merits in earlier years, the appeals of the revenue are pending at various stages in High Court and Supreme Court as the case may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to its business income. 6.3. The ld. PCIT noted that assessee's receipts from food and beverages are Rs 1968.98 lakhs and expenditure on the material cost is Rs 611.21 lakhs thereby resulting in 222% profit over the expenditure. The assessee replied that besides the material cost, there are other expenses which are incurred such as salaries, fuel, electricity and water charges, which when directly attributed to the food receipts, there is a net lsos from the catering activities. The ld. PCIT observed that assessee failed to furnish any detail demonstrating its claim. 6.4. The ld. PCIT noted that assessee is providing residential accommodation for the members and non-members ( as guests) of the society and had shown receipt of Rs 752.39 lakhs under the head 'Hostel Rooms' and no corresponding expenses have been claimed. Therefore the corresponding expenses have also been intermingled with other expenses and the same calls for an in-depth understanding and deeper investigation into assessee's accounts. 6.5. Further , the differential treatment in terms of services (like library, hostel booking, dining & bar facilities are exclusively available to members and / or their guests only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cipline, which has been completely and conveniently ignored by the ld. PCIT in the instant case. Apart from this, we also find that the ld. AO had indeed made specific enquiries on the very same issues that were raised by the ld. PCIT in his revision order. The notices issued u/s 142(1) of the Act by various officers under faceless regime are as under:- a) Notice u/s 142(1) of the Act dated 22.12.2020 by National e- Assessment Centre, Delhi b) Notice u/s 142(1) of the Act dated 15.10.2020 by National e- Assessment Centre, Delhi c) Notice u/s 142(1) of the Act dated 04.03.2021 by National e- Assessment Centre, Delhi 8. This goes to prove that sufficient enquiries were indeed made by the various assessing officers in the course of assessment proceedings under faceless regime. It is not in dispute that the assessee had indeed filed complete details regarding the queries raised by the various assessing officers. Infact most of the queries raised were even repetitive in nature and details were filed by the assessee repeatedly. Moreover, we find that the ld. AO under the faceless regime had even asked for the scrutiny assessment orders for the Asst Years 2016-17 and 2017-18 whi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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