1998 (4) TMI 29 - HC - Income Tax

Summary

Issues: Application of section 144B of the Income-tax Act to pending assessments for the assessment year 1975-76.

Analysis:
The judgment deals with the application of section 144B of the Income-tax Act to pending assessments for the assessment year 1975-76. The assessee, a private limited company engaged in printing and publishing, filed a return declaring a net loss for the assessment year 1975-76. The Income-tax Officer computed the income and made the assessment based on the procedure under section 144B. The assessee objected to this procedure, arguing that section 144B was not applicable to pending assessments. The Commissioner of Income-tax (Appeals) upheld the assessment, leading to an appeal before the Tribunal.

The Tribunal considered whether section 144B was substantive or procedural in nature. It held that the section was procedural and would apply to pending proceedings. The Tribunal's decision was based on the view that section 144B aimed to provide an opportunity to the assessee and prevent arbitrariness by the Income-tax Officer. The Tribunal's decision was supported by previous judgments, including those of the Delhi and Rajasthan High Courts, which held that procedural provisions apply to pending assessments.

Ultimately, the High Court agreed with the Tribunal's interpretation, stating that section 144B was indeed procedural and applicable to all pending assessments. The High Court referred to previous decisions that supported this view, emphasizing that the section aimed to ensure fairness in assessments. Therefore, the High Court concluded that the Tribunal was correct in applying section 144B to the assessee's case for the assessment year 1975-76. The judgment resolved the issue, disposing of the tax case without imposing any costs.