9911796707
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Issues:
1. Jurisdiction of the Appellate Assistant Commissioner to direct the Income-tax Officer to examine the books of account of the assessee. 2. Validity of the order of remand made by the Appellate Assistant Commissioner. 3. Obligation of the Appellate Tribunal to consider the report on the order of remand. 4. Contention regarding the finality of the order of the Appellate Assistant Commissioner and the appeal by the Commissioner under Section 33. Jurisdiction of the Appellate Assistant Commissioner: The case involved the question of whether the Appellate Assistant Commissioner had the power to direct the Income-tax Officer to examine the books of account of the assessee, especially when the books were not produced at the proper time. The Appellate Assistant Commissioner's power arises under Section 31(2) of the Income-tax Act, allowing further inquiry before disposing of an appeal. The argument presented was that the Appellate Assistant Commissioner's jurisdiction should not be challenged if he deems it necessary to examine the books for a best judgment assessment. However, it was contended that such a power could undermine the statutory provisions and the purpose of Section 27, which deals with non-production of account books by the assessee. Validity of the order of remand: The Appellate Assistant Commissioner's order of remand was challenged on the grounds that it was solely based on giving the assessee another opportunity to produce their books of account, rather than for the purpose of deciding the quantum or the correctness of the Income-tax Officer's judgment. The Court held that the order of remand was erroneous as it contradicted the previous dismissal of the assessee's application under Section 27 and essentially allowed them a second chance to produce the books, which was not in line with the statutory provisions. Obligation of the Appellate Tribunal: The High Court clarified that if the order of remand was deemed invalid, as held in this case, the Appellate Tribunal was not obligated to consider the report resulting from that remand order. The Tribunal was within its powers to refuse to apply their mind to the report made by the Income-tax Officer based on the invalid order of remand by the Appellate Assistant Commissioner. Contention regarding finality of the order: The argument put forth regarding the finality of the Appellate Assistant Commissioner's order and the absence of an appeal by the Commissioner under Section 33 was dismissed by the Court. It was clarified that the power of the Commissioner to prefer an appeal under Section 33(2) was limited to substantive orders made under Section 31(3), and the direction issued by the Appellate Assistant Commissioner in this case was not appealable. Therefore, the Commissioner was not aggrieved by the dismissal of the appeal and had no grounds for appeal. In conclusion, the High Court answered both questions submitted to them in the negative, highlighting the lack of jurisdiction of the Appellate Assistant Commissioner to direct the examination of account books and the invalidity of the order of remand in this particular case.
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