An assessee has regularly filing his ITR. In Assessment year 2010-11 due to some some miscommunication ITR has got skipped from filing althought TDS has also been deducted and advance tax has also been paid for the said year. Aferwards he is filinging his returns regularly. Now in assessment of 2011-12 ITO has charged income tax on the difference between the closing capital of AY 2009-10 and opening capital of AY 2011-12.
Is there any provision/ case law that can guide.
Probably he is doing best judgement assessment u/s 144 but for that an oppourtunity of being heard must be given by way of notice to show the cause as why the assessement should not completed on best of his judgement.
If such notice was not given or if he is not considering the information provided by you and is doing assessment on arbitrary basis then you may appeal against such order.
Credit of taxes paid by way of advance tax and TDS shall be given.
However penalty for non filing of return for amount of 5000 may be levied u/s 271F
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