2007 (1) TMI 114 - HC - Income Tax

Summary

Issues involved:
The issues involved in the judgment are:
1. Whether the assessment order u/s 144 of the Income-tax Act was barred by limitation?
2. Whether the approval of the Range DCIT taken by the Assessing Officer vitiated the assessment proceeding and consequent thereof the assessment order issued by the Assessing Officer?

Issue 1: Assessment Order Barred by Limitation:
The dispute pertains to the assessment year 1993-94. The contention was that the assessment order passed on February 25, 1997, under section 144 was beyond the limitation period as prescribed under section 153(1)(a). It was argued that the assessment year ended on March 31, 1994, and the two-year limitation period extended up to March 31, 1996, making the assessment order passed in 1997 time-barred. The Tribunal held that the order was indeed barred by limitation as per the provisions of the Act.

Issue 2: Approval of Range DCIT and Quasi-Judicial Powers:
The assessment order was made with the approval of the Range Deputy Commissioner of Income-tax. The argument presented was whether the Assessing Officer's quasi-judicial powers were compromised by seeking approval from a higher authority. The respondent argued that the Assessing Officer's decision-making should not be influenced by higher authorities, citing a Supreme Court judgment. However, the court found insufficient evidence to conclude that the approval process involved undue influence or control. Given the decision on the first issue, the court declined to provide a definitive answer on this matter.

In conclusion, the High Court of GAUHATI dismissed the appeal by the Revenue, affirming the decision that the assessment order was barred by limitation. The court also declined to provide a conclusive answer regarding the influence of the Range Deputy Commissioner's approval on the assessment proceeding, citing insufficient evidence and the decision on the first issue.