1978 (12) TMI 43 - HC - Income Tax

Summary

Issues Involved:
1. Jurisdiction of the ITO to call for information after completion of assessment.
2. Validity of reference by the ITO to the Valuation Officer u/s 55A of the I.T. Act.
3. Applicability of s. 133(6) of the I.T. Act for calling information.

Summary:

1. Jurisdiction of the ITO to call for information after completion of assessment:
The petitioner-firm argued that the ITO had no jurisdiction to call for information after the completion of assessment for the years 1972-73, 1973-74, and 1974-75. The ITO had requested the Valuation Officer to report on the value of the premises for these years, which the petitioner contended was beyond the ITO's jurisdiction. The court noted that the ITO is charged with the duty of framing assessment against the assessees and that the term "assessment" includes rectification and reassessment u/s 147 of the Act. Therefore, the ITO could either call for this information directly or authorize the Valuation Officer to collect it.

2. Validity of reference by the ITO to the Valuation Officer u/s 55A of the I.T. Act:
The Full Bench examined whether the reference by the ITO to the Valuation Officer to ascertain the value of the mill was valid. The court noted that s. 55A of the Act is meant for ascertaining the fair market value of a capital asset for the purposes of Chapter IV, specifically Part E dealing with "capital gains." Since the mill in question was not a subject of transfer, s. 55A did not apply. The court concluded that s. 55A does not in terms apply to the facts and circumstances of this case.

3. Applicability of s. 133(6) of the I.T. Act for calling information:
The department argued that s. 133(6) allows the ITO to require any person to furnish information useful for any proceeding under the Act. The court observed that the ITO could directly require the petitioner to furnish the information sought by the Valuation Officer, and thus, the ITO could get this done with the assistance of the Valuation Officer. The court also noted that the search conducted on the Jindal Group of Companies was a proceeding under the Act, and the ITO was advised to make an enquiry regarding the cost of construction of the mill based on the intelligence wing's report. The court held that the mentioning of s. 55A in the ITO's letter to the Valuation Officer was of no consequence, as the proceedings were otherwise in accordance with law.

Conclusion:
The Full Bench answered the question in the affirmative, validating the ITO's reference to the Valuation Officer. The writ petition was dismissed, and the parties were left to bear their own costs.