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Jurisdiction of the Commissioner under section 25(2) for the assessment year 1978-79; Merger of assessment order in the appellate order; Interpretation of the rule regarding merger of orders in appellate decisions. Analysis: 1. Jurisdiction of the Commissioner under section 25(2): The appeal was filed by the assessee against the order of the CWT for the assessment year 1978-79, challenging the jurisdiction of the Commissioner. The contention was that the Commissioner lacked jurisdiction as he passed the order without verifying his authority in the matter. The Commissioner's order set aside the assessment order due to lack of necessary inquiries by the WTO regarding the assessee's interest in a partnership firm. The assessee argued that the assessment order had merged into the appellate order passed by the AAC of Wealth-tax, citing the decision of the Allahabad High Court and the Supreme Court. The Tribunal agreed with the assessee's argument, emphasizing the principle that the appellate decision is the operative decision in law, leading to a complete merger of the assessment order in the appellate order. 2. Merger of assessment order in the appellate order: The Tribunal analyzed the facts of the case and rejected the revenue's claim of a partial merger of the assessment order. Referring to a previous case, the Tribunal confirmed that the assessment order in its entirety merged into the appellate order. Therefore, the Tribunal held that the CWT did not have jurisdiction to revise the assessment order under section 25(2) of the Wealth-tax Act. Consequently, the Commissioner's order was deemed to lack jurisdiction and was canceled by the Tribunal. 3. Interpretation of the rule regarding merger of orders in appellate decisions: The Tribunal emphasized the concept of complete merger of the assessment order in the appellate order, following precedents and established legal principles. It reiterated that once an assessment is subject to an appeal, the appellate authority can adjudicate on all findings, not just the subject matter of the appeal. The Tribunal clarified that even if the appeal was on a limited issue, there was a complete merger of the assessment order in the appellate order, rendering the original decision ineffective. This interpretation was crucial in determining the jurisdictional authority of the Commissioner under section 25(2) of the Wealth-tax Act. In conclusion, the Tribunal allowed the appeal, highlighting the importance of the complete merger of the assessment order in the appellate decision and the consequent impact on the jurisdiction of the Commissioner under the Wealth-tax Act.
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