1992 (12) TMI 61 - AT - Income Tax

Summary

Issues:
- Appeal against the order under section 143(1)(a)
- Competency of the DCIT(A) to entertain the appeal
- Status of the assessee as AOP (Trust) vs. specific Trust
- Grounds raised by the revenue against the order of the DCIT(A)
- Validity of the appeal based on various grounds

Analysis:

The appeal was filed by the revenue against the order of the Deputy Commissioner of Income-tax (Appeals), Range-III, Bangalore, regarding the assessment year 1989-90. The DCIT(A) entertained the appeal filed by the assessee objecting to the change of status adopted by the Assessing Officer from specific Trust to AOP (Trust), resulting in tax being levied on the Trust itself. The DCIT(A) directed the Income-tax Officer to assess the assessee in the status of specific Trust based on previous Tribunal orders.

The revenue raised several grounds in their appeal, including the contention that the DCIT(A) erred in entertaining the appeal against the order under section 143(1)(a) and directing the assessment as a specified trust. They argued that the order under section 143(1) is not appealable and that the status of Trust is not recognized under the Income-tax Act. The revenue also questioned the finality of previous Tribunal decisions.

During the hearing, the departmental representative argued that the appeal was not maintainable under section 143(1)(a)/143(1A) based on a judgment of the Allahabad High Court. The assessee's representative justified the appeal, stating that the dispute over the status adopted by the Income-tax Officer falls under appealable orders. The departmental representative suggested seeking revision under section 264 or filing a writ, rather than appealing to the DCIT(A) or CIT(A).

The Tribunal analyzed the provisions of the Act and noted that the relevant section for adjustments was section 143(1A) from 1-4-1989, not section 143(1)(a). The Tribunal clarified that the amendment under Finance Act, 1991, did not apply to intimation under section 143(1A) before 1-10-1991. The Tribunal concluded that the DCIT(A) wrongly entertained the appeal against the order under section 143(1A) and canceled the impugned order.

Regarding the status of the assessee, the Tribunal found that the appeal was not maintainable as the assessee conceded the correctness of the status as AOP (Trust). Challenges related to the amount of tax determined and denial of liability to be assessed were also dismissed. The Tribunal held that the DCIT(A) wrongly entertained the appeal, and the grounds raised by the revenue were valid, leading to the cancellation of the DCIT(A)'s order.

In conclusion, the Tribunal allowed the appeal filed by the revenue, finding that the DCIT(A) had wrongly entertained the appeal against an order under section 143(1A) and that the impugned order was unjustified in law and void ab initio.