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Issues:
1. Validity of the orders of Additional Income-tax Officer dated March 30, 1955, and March 31, 1955, revising individual assessments made on March 31, 1952 under section 35 of the Income-tax Act. 2. Whether the original assessment orders were provisional and subject to variation based on the agreement made by the petitioners. 3. Applicability of section 35(5) to the case. 4. Validity of the impugned order made under section 35(1) of the Income-tax Act. Analysis: The judgment involves three petitions challenging the orders of the Additional Income-tax Officer revising individual assessments made under section 35 of the Income-tax Act. The petitioners, partners in a firm, submitted their returns declaring income and agreed to revise the order after the firm's assessment. The main contention was the legality of the revision under section 35. The court considered whether the original assessments were provisional and subject to variation based on the agreement. It was crucial to determine if section 35(5) applied to the case, which would affect the outcome of the petitions. The court analyzed precedents to establish the scope of section 35(5) and its retrospective application. The court delved into whether the agreement made by the petitioners could be used to revise the assessments under section 35(1) of the Act. It was noted that for rectification under section 35(1), there must be a mistake apparent from the record. The court referred to previous cases to determine the interpretation of a mistake apparent from the record, emphasizing the need for a clear error evident from the assessment records. The judgment highlighted the distinction between cases where the assessment was provisionally accepted based on an agreement and those where no such agreement existed. Furthermore, the court discussed the aspect of time limitation in completing assessments under sections 23 and 29. It noted that the Income-tax Officer could have waited for the firm's assessment completion but acted based on the petitioners' promise. The court emphasized the importance of parties acting in good faith and honoring agreements made during the assessment process. It concluded that the petitioners, by waiving their right to challenge the assessment based on the agreement, could not now dispute the competence of the Income-tax authority. The judgment dismissed the petitions, citing that the petitioners had relinquished their right by acting in full faith on their word, and their conduct did not merit discretionary relief under Article 226 of the Constitution.
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