9911796707
|
Home
Issues:
1. Validity of reopening the case for the assessment year. 2. Assessability of income in the assessment year despite amended provisions of section 45(5) of the Income-tax Act, 1961. 3. Applicability of relief to the assessee based on a specific Supreme Court decision. Analysis: Issue 1: Validity of Reopening the Case The Department sought a direction against the Income-tax Appellate Tribunal regarding the validity of reopening the case for the assessment year under consideration. The Land Acquisition Officer made an award for the land acquired by the assessee-respondent, and the compensation amount was enhanced on appeal. The respondent received the enhanced compensation in 1986, and an assessment was made for the year 1975-76. Subsequently, proceedings were reopened for the year 1987-88 under section 147(a) based on the compensation received in 1986. The Tribunal, after considering the arguments, held that the reopening of the case was not valid or justified. The Commissioner of Income-tax also supported this view, setting aside the assessment order. The Tribunal's decision was in line with the Commissioner's stance, emphasizing that the capital gain could not be assessed for the year 1987-88 as per section 45(5) since it was introduced in 1988. Issue 2: Assessability of Income The Department contended that section 45(5) of the Income-tax Act applied to cases of compulsory acquisition, focusing on the date of compensation receipt. However, the Court found this argument unsubstantiated. The Finance Bill of 1987 clarified that amendments would be effective from April 1, 1988, applying to the assessment year 1988-89 onwards. As the enhanced compensation was received in 1986, falling within the assessment year 1987-88, section 45(5) was deemed inapplicable. The Tribunal correctly determined that the assessment should align with the provisions of section 45(1) of the Income-tax Act. Issue 3: Applicability of Relief The Department sought relief based on a specific Supreme Court decision, questioning the Tribunal's application of the decision in the present case. However, the Court found no referable question of law arising from the Tribunal's order. Consequently, the Tribunal's decision to refuse a reference on the questions posed by the Department was deemed justified. The reference application was rejected accordingly. In conclusion, the High Court upheld the Tribunal's decision, emphasizing the correct application of the Income-tax Act provisions and dismissing the Department's claims regarding the reopening of the case and the applicability of specific legal provisions.
|
