1976 (12) TMI 32 - HC - Income Tax

Summary

Issues:
1. Interpretation of section 33B of the Indian Income-tax Act, 1922 regarding the limitation period for passing orders by the Commissioner.
2. Validity of the Tribunal's direction to the Commissioner to pass orders afresh under section 33B after the expiry of the limitation period.
3. Comparison of provisions under section 33B of the 1922 Act and section 263 of the 1961 Act in relation to revision of orders prejudicial to revenue.

Analysis:

The High Court of Calcutta considered a reference under section 66(2) of the Indian Income-tax Act, 1922, focusing on the correctness of authorizing the Commissioner to pass an order under section 33B after the limitation period. Section 33B empowers the Commissioner to revise orders prejudicial to revenue within a specified time frame. The Commissioner found assessment orders erroneous and issued a show-cause notice to the assessee for fresh assessments. The Tribunal vacated the order under section 33B due to improper service of notice, directing the Commissioner to reconsider after proper hearing.

The assessee argued that the Commissioner lacked authority to revise orders after the limitation period under section 33B. The court compared provisions of section 33B with section 263 of the 1961 Act and noted the absence of a specific provision enabling the Commissioner to pass orders afresh after the limitation period. The Tribunal's direction was challenged based on the limitation period specified in section 33B.

Referring to a prior Division Bench judgment and a Supreme Court case involving similar issues under the 1961 Act, the court concluded that orders made pursuant to directions or court orders were not bound by the original limitation period. The court held that the Commissioner must comply with the Tribunal's direction despite the limitation period in section 33B. Consequently, the court answered the reference question in favor of the revenue.

The court rejected the assessee's application for a certificate to appeal to the Supreme Court, citing alignment with the Supreme Court's decision. Justice Deb concurred with the judgment, emphasizing the applicability of the Supreme Court's ruling in the present case. The court made no order regarding costs in this matter.