2005 (7) TMI 544 - AT - Income Tax

Summary

Issues Involved:
1. Jurisdiction of the Assessing Officer to initiate re-assessment proceedings.
2. Validity of the assessment made based on the notice under section 148.
3. Denial of inspection of assessment records and certified copies to the assessee.
4. Powers of the Tribunal under section 255(6) of the Income-tax Act, 1961, and Rule 29 of the ITAT Rules, 1963.

Detailed Analysis:

Jurisdiction of the Assessing Officer to Initiate Re-assessment Proceedings:
The assessee contested the jurisdiction of the Assessing Officer to initiate re-assessment proceedings under section 148 of the Income-tax Act, 1961, for the assessment year 2000-01. The Tribunal admitted two additional grounds raised by the assessee, which questioned the jurisdiction and legality of the notice issued under section 148. The assessee argued that the initiation of re-assessment proceedings was based on a note by a Senior Tax Assistant, which needed to be scrutinized to determine if the Assessing Officer had applied his mind properly before initiating the proceedings.

Validity of the Assessment Made Based on the Notice under Section 148:
The assessment was completed under section 143(3) read with section 148, determining the total income at Rs. 4,09,69,360. The assessee challenged the re-assessment proceedings before the CIT(A), who upheld the re-assessment. The Tribunal noted that the note by the Senior Tax Assistant, which led to the re-assessment, was crucial to determine the validity of the proceedings. The Tribunal emphasized that the mandatory legal requirements for initiating re-assessment proceedings must be satisfied, and the Assessing Officer's application of mind was essential.

Denial of Inspection of Assessment Records and Certified Copies to the Assessee:
The assessee's counsel argued that despite repeated requests, the assessee was denied inspection of the assessment records and certified copies of relevant documents, including the note by the Senior Tax Assistant. The Tribunal found merit in the assessee's argument that these documents were essential to examine whether the re-assessment proceedings were initiated correctly. The Tribunal directed the Assessing Officer to allow the assessee or his counsel to inspect the records and obtain certified copies.

Powers of the Tribunal under Section 255(6) of the Income-tax Act, 1961, and Rule 29 of the ITAT Rules, 1963:
The Tribunal clarified its powers under section 255(6) and Rule 29, stating that it has the authority to regulate its procedure and call for documents or witnesses if necessary for deciding the appeal. The Tribunal emphasized that it could direct the production of documents and information from the parties, even in appellate proceedings. The Tribunal directed the Assessing Officer to produce specific documents, including the intimation under section 143(1), the original note by the Senior Tax Assistant, and the order-sheet of the re-assessment proceedings, for the next hearing.

Conclusion:
The Tribunal ordered the Assessing Officer to produce the relevant documents and allow the assessee to inspect them. The Tribunal scheduled the next hearing for 18-8-2005 and directed the registry to notify the parties accordingly. The order highlighted the Tribunal's authority to ensure that all necessary documents are available to adjudicate the appeal comprehensively.