1984 (4) TMI 95 - AT - Income Tax

Appellate Assistant Commissioner, Applied To, Assessee s Appeal, Assessment Order, Change In Previous Year

Summary

Issues:
1. Change of previous year for assessment year 1977-78.
2. Allowance of section 80J relief pro rata.
3. Merger of orders between ITO and Commissioner.
4. Admissibility of grounds for appeal under section 246(c).
5. Allowance of section 80J relief on borrowed funds.

Detailed Analysis:

Issue 1: The assessee sought to change its previous year for the assessment year 1977-78, with the ITO allowing the change from 1-4-1976 to 30-6-1976 subject to conditions. The Commissioner upheld some conditions and deleted one regarding pro rata depreciation. The assessment was completed on 29-2-1980.

Issue 2: The assessee appealed against the pro rata allowance of section 80J relief, arguing it should be for the full year. The Commissioner rejected the appeal citing merger of orders. The Tribunal noted the Commissioner's order under section 264 was final and binding, dismissing the ground for appeal.

Issue 3: The Tribunal disagreed with the Commissioner's reasoning on merger, stating the orders were distinct due to different dates. The Tribunal emphasized that the Commissioner's order under section 264 was final and binding, precluding further appeal.

Issue 4: The Tribunal clarified that since the Commissioner's order under section 264 conclusively decided the issue of section 80J relief, the assessee had no grounds for appeal under section 246(c). The Tribunal dismissed the appeal on this basis.

Issue 5: The Tribunal addressed the allowance of section 80J relief on borrowed funds, referring to pending Supreme Court cases and amendments to section 80J. The Tribunal set aside previous decisions and referred the matter back to the ITO for reconsideration in light of potential changes.

In conclusion, the Tribunal allowed the appeal for statistical purposes but upheld the Commissioner's decision on the section 80J relief issue. The Tribunal emphasized the finality of the Commissioner's order under section 264 and the limitations on further appeals based on that order.