1990 (3) TMI 29 - HC - Income Tax

Summary

Issues:
1. Validity and legality of the order of the Income-tax Appellate Tribunal dated December 7, 1983.
2. Whether reassessments made by the Income-tax Officer were barred by limitation under section 153 of the Income-tax Act, 1961.
3. Power of the Tribunal to grant stay of reassessment proceedings during the pendency of reference before the High Court.

Analysis:
1. The petitioner challenged the legality and validity of the Income-tax Appellate Tribunal's order dated December 7, 1983, regarding reassessments completed for the assessment years 1965-66 to 1967-68 and 1969-70 and 1970-71. The Commissioner (Appeals) set aside the assessments due to procedural irregularities and directed fresh assessments according to law. The Tribunal upheld the validity of reopening the assessments but agreed that certain procedural lapses required fresh assessments. The petitioner filed reference applications, and one question of law was referred to the High Court.

2. The key issue was whether the reassessments were barred by limitation under section 153 of the Income-tax Act, 1961. The Tribunal rejected the petitioner's application to stay reassessment proceedings until the reference was disposed of by the High Court. The petitioner argued that the Tribunal had the power to grant a stay based on Supreme Court decisions. However, the Tribunal held that it lacked the power to grant a stay and that the balance of convenience favored not granting a stay due to the age of the assessments and potential multiplicity of proceedings.

3. The Tribunal's decision not to grant a stay was based on the principle that the Tribunal continues to have powers necessary to make the right of appeal effective during and after the appeal process. The Tribunal's rejection of the application was upheld by the High Court, emphasizing that the balance of convenience favored the Revenue in this case. The High Court concluded that the Tribunal was justified in not granting a stay of the reassessment proceedings, and the petition was dismissed without costs. The oral application for a stay of the order was also rejected.