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Interpretation of a provisional assessment order under section 141A of the Income-tax Act, 1961 and the appealability of such an order. Analysis: The case involved a reference under section 256(1) of the Income-tax Act, 1961, where the Income-tax Appellate Tribunal referred a question regarding the appealability of a provisional assessment order made by the Income-tax Officer under section 141A of the Act. The assessee, a subsidiary of the State Bank of India, had submitted a return for the assessment year 1981-82 claiming a business loss and seeking a refund. The Income-tax Officer made a provisional assessment under section 141A disallowing certain deductions claimed by the assessee. The primary issue was whether this order was appealable. The Commissioner of Income-tax (Appeals) dismissed the appeal, stating that the order was under section 141A and not appealable. The Tribunal affirmed this view, leading to the reference to the High Court. The assessee argued that the order was actually under section 143(3) and hence appealable. The Revenue contended that the order was a provisional assessment for refund under section 141A and not subject to appeal. The High Court analyzed the provisions of section 141A, emphasizing that a provisional assessment under this section is made based on the return filed by the assessee and adjustments required therein. The Court noted that even if the Income-tax Officer erroneously disallowed deductions, it would not convert the order under section 141A into one under section 143(3) for appeal purposes. The Court also rejected the argument that the order could be considered under section 237, as the claim for refund under section 237 only arises after determining the proper chargeable amount, which was not the case here. Ultimately, the High Court held that the order dated December 16, 1981, was a provisional assessment for refund under section 141A of the Act and not appealable, in line with the provisions of sub-section (6) of section 141A. The Court answered the reference question in the affirmative, ruling against the assessee and directing each party to bear its own costs. In conclusion, the judgment clarified the nature of provisional assessment orders under section 141A, emphasizing that such orders are based on the return filed by the assessee and are not appealable. The Court highlighted that errors in disallowing deductions do not change the provisional assessment's character and upheld the Tribunal's decision regarding the appealability of the order.
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