1991 (6) TMI 67 - HC - Income Tax

Summary

Issues:
- Maintainability of the appeal filed by the assessee before the Appellate Assistant Commissioner without filing objections to the draft assessment order under section 144B of the Income-tax Act, 1961.

Analysis:
The case involved a dispute regarding the maintainability of an appeal filed by the assessee before the Appellate Assistant Commissioner without filing objections to the proposed variation in the income under section 144B of the Income-tax Act. The assessing authority estimated the income as Rs. 60,900 under section 143(3) of the Income-tax Act for the assessment year 1978-79. The Revenue contended that the appeal was not maintainable due to the lack of objections by the assessee to the proposed variation. However, the Appellate Assistant Commissioner allowed the appeal in part, reducing the addition by Rs. 23,030. The Revenue then filed a second appeal before the Appellate Tribunal, arguing that the appeal before the Appellate Assistant Commissioner was not maintainable without filing objections to the variation suggested under section 144B.

The Appellate Tribunal, relying on a decision of the Bombay Bench 'C' (Special Bench) of the Income-tax Appellate Tribunal, rejected the Revenue's contention. The Revenue subsequently sought reference of the question to the High Court. The High Court analyzed the provisions of the Income-tax Act and held that the appeal against an assessment under section 143(3) is maintainable, regardless of whether objections were filed under section 144B. The court emphasized that the language of section 246 of the Income-tax Act allows an appeal against assessments made under section 143(3), irrespective of the procedure followed. Therefore, the court concluded that the appeal before the Appellate Assistant Commissioner was maintainable, ruling in favor of the assessee and against the Revenue.

In the final judgment, the High Court answered the question in the affirmative, stating that the appeal was maintainable. The court also directed that a copy of the judgment be forwarded to the Income-tax Appellate Tribunal, Cochin Bench. No costs were awarded in this matter.