1996 (9) TMI 107 - HC - Income Tax

Summary

Issues:
1. Whether the Assessing Officer, after a de novo assessment order by the Tribunal, can assess income that had escaped assessment in the original assessment.
2. Whether the Tribunal was correct in upholding the deletion of certain additions made by the Assessing Officer.

Analysis:
1. The case involved the assessment of a company under the Income-tax Act, where the Tribunal remanded the matter to the Assessing Officer for a de novo assessment. The Assessing Officer, during the fresh assessment, included certain incomes that were previously left out. The Commissioner of Income-tax (Appeals) deleted these additions, stating that the Tribunal's order was limited to a specific issue and did not authorize the Assessing Officer to consider new matters. The Tribunal upheld this decision, emphasizing that the Assessing Officer exceeded the scope of the Tribunal's order. The Revenue challenged this decision, arguing that the Assessing Officer had the jurisdiction to consider new matters during a fresh assessment. The court referred to relevant legal precedents and concluded that the Assessing Officer was entitled to include additional income during a fresh assessment, as directed by the Tribunal. The court held that the inclusion of the amount was permissible and ruled in favor of the Revenue.

2. The second issue pertained to the Tribunal's decision to uphold the deletion of certain additions made by the Assessing Officer. The Tribunal confirmed the Commissioner of Income-tax (Appeals)'s order, stating that the Assessing Officer had exceeded the scope of the Tribunal's remand order by making additional additions. The Tribunal found the Commissioner's decision justified and upheld the deletion of the amounts. The court, after analyzing the arguments presented by both parties, concluded that the Tribunal's order for a fresh assessment allowed the Assessing Officer to consider additional incomes that were previously left out. Therefore, the court ruled in favor of the Revenue and against the assessee, answering both questions in the negative.

In summary, the court held that the Assessing Officer had the jurisdiction to include additional income during a fresh assessment ordered by the Tribunal, even if it had escaped assessment in the original assessment. The court emphasized that the Assessing Officer's actions were in accordance with the law and the Tribunal's directions. The decision favored the Revenue, upholding the inclusion of the additional amounts and rejecting the challenges raised by the assessee.