Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram

Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2006 (4) TMI HC This

  • Login
  • Referred In
  • Summary

Forgot password       New User/ Regiser

⇒ Register to get Live Demo



 

2006 (4) TMI 86 - HC - Income Tax


Issues:
1. Interpretation of section 263 of the Income-tax Act, 1961.
2. Validity of the assessment order passed by the Assessing Officer.
3. Jurisdiction of the Commissioner of Income-tax to revise the assessment order.
4. Application of mind by the Assessing Officer in making the assessment.
5. Determination of whether proper enquiry was conducted by the Assessing Officer.

Analysis:
The judgment revolves around the interpretation and application of section 263 of the Income-tax Act, 1961. The Revenue moved an application seeking a direction to the Tribunal to refer a question of law arising from an order passed by the Tribunal in relation to the assessment year 1990-91. The Commissioner of Income-tax had issued a notice under section 263, deeming the assessment order passed by the Assessing Officer as erroneous and prejudicial to the interests of the Revenue. The Commissioner concluded that the assessment was completed hastily without proper investigation, leading to an incorrect assessment.

Upon appeal, the Tribunal considered the material on record and found that the Assessing Officer had conducted a proper enquiry before making the assessment order. The Tribunal determined that there was no justification for the Commissioner to hold the assessment as erroneous and prejudicial to Revenue's interests. It was also noted that the assessment was not completed in undue haste. The Tribunal emphasized that whether the Assessing Officer conducted a proper enquiry is a question of fact, depending on the circumstances of each case.

The Tribunal's decision was based on the satisfaction that the Assessing Officer had indeed conducted a thorough enquiry and applied his mind to the relevant material before making the assessment order. It was established that the Assessing Officer's order could only be revised under section 263 if it was made without proper enquiry and was prejudicial to Revenue's interests. Since the Tribunal found that a proper enquiry was conducted, it was determined that the order did not give rise to any question of law.

Therefore, the Tribunal rejected the application under section 256(1), stating that the order did not raise any legal question. Consequently, the application under section 256(2) was dismissed, and no costs were awarded in this matter.

 

 

 

 

Quick Updates:Latest Updates