9911796707
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Issues involved:
The judgment addresses the following issues: 1. Whether a reference under section 144B affects the jurisdiction of the Commissioner under section 263 of the Income-tax Act, 1961. 2. Whether the pendency of an appeal against an assessment order ousts the jurisdiction of the Commissioner under section 263. 3. Whether the reopening of an assessment under section 147 affects the Commissioner's jurisdiction under section 263. 4. Whether a sum received and credited to a specific fund constitutes a trading receipt taxable as income. Issue 1: Reference under section 144B and Commissioner's jurisdiction under section 263: The Tribunal held that a reference under section 144B does not affect the Commissioner's jurisdiction under section 263. The court agreed, stating that no cogent reason was presented to support the ousting of the Commissioner's jurisdiction. Issue 2: Appeal pendency and Commissioner's jurisdiction under section 263: The Tribunal ruled that the pendency of an appeal against an assessment order does not oust the Commissioner's jurisdiction under section 263. As the issues before the Commissioner were not part of the appeal, the Tribunal's decision was upheld. Issue 3: Reopening of assessment and Commissioner's jurisdiction under section 263: The Tribunal found that the mere reopening of an assessment under section 147 does not affect the Commissioner's jurisdiction under section 263. The court concurred, noting that the reopening alone does not impact the Commissioner's authority. Issue 4: Treatment of sum credited to a specific fund: The assessee argued that the sum credited to the Molasses Storage Fund, as per the Molasses Control Order, was not taxable income. However, the court applied the test of diversion of income versus application of income. Following legal precedents, it determined that the amount credited constituted a trading receipt taxable as income, as it was an application of income, not a diversion. In conclusion, the court answered all four questions in the affirmative, supporting the Tribunal's decisions. The assessee was held liable for the sum received and credited to the Molasses Storage Fund as taxable income.
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