9911796707
TMI Blog1983 (3) TMI 113X X X X Extracts X X X X X X X X Extracts X X X X ..... C was fully justified and correct in law in cancelling assessment. As such his order is sustainable on facts and tenable in law. 2. That on facts of the case as well as in law and order passed by the ITO under section 143(3) read with section 147 being bad, illegal and void and not in conformity to law, the same could not have been held as legal order and as such the learned AAC was fully justified in cancelling the said order. 3. That the direction given by the learned AAC to the ITO for completing the proceedings pending before him under section 23(3) is without justification and not in conformity to law. 4. That in case the order of the learned AAC is found unsustainable by the Hon'ble Tribunal then looking to the fact that various other grounds raised by the respondent before the AAC were not disposed of by him, the AAC be kindly directed to dispose of the appeal of the assessee in respect of various other grounds in accordance with law. 5. That the respondent may be permitted to raise such other grounds as may be considered necessary at the time of hearing." 4. The facts may now be stated. The assessment year involved is the year 1959-60, for which the previous year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of income as under : Rs. i. Income from house property 625 ii. Income from business 30,18,522 iii. Interest on securities 26,236 ---------------- 30,45,385 ---------------- In this assessment, income from under-invoicing of export of manganese ore was taxed at Rs. 30,83,968 and no separate addition on account of income from other sources was made because the Tribunal had given a finding that income from other sources was not required to be taxed separately as that amount represented the assessee's own income from under invoicing of export of manganese ore, which was brought in the books of account in a different form. In the body of the assessment the ITO also observed that "in finalising this assessment, therefore, the directions of the AAC with regard to the original assessment under section 23(3) have also been borne in mind". The draft assessment order was made on22-3-1976and the assessment was framed after obtaining the directions of the IAC as provided under section 144B of the Act which was inserted by the Taxation Laws (Amendment) Act, 1975, with effect from1-4-1976. 7. Against this assessment the assessee filed an appeal to the AAC and raised as many as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting aside of the order passed by the AAC. With the above directions the assessment is cancelled and the appeal is allowed." In view of the aforesaid order, the AAC did not deal with the other grounds of appeal raised before him. 8. Both the parties are aggrieved by the aforesaid order of the AAC. The grounds raised by both the parties have already been noted above. 9. The learned departmental representative submitted that no appeal had been filed against the order of the AAC dated7-1-1971and that the AAC had not set aside the assessment order completely. He referred to para 13 of the order of the AAC wherein it was held "Hence, I set aside the assessment for 1959-60 with a direction to re-do the same in respect of both these points". These two points are clarified in summing up the result of appeal in para 23, the relevant portion of which reads as under : "(iii) The following additions are set aside for re-examination and re-doing the assessment : (a) Rs. 8,00,267 under other sources as indicated in para (13) which disposes of grounds (1 to 4). (b) Rs. 6,74,957 as interest as in para (13) which disposes of ground No. (5)." He submitted that the AAC should not have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the point that the ITO should have made two separate assessments (i) to give effect to the order of the AAC ; and (ii) to bring to tax escaped income, if any, nonetheless, the learned counsel for the assessee supported the order of the AAC. He also submitted that on ground No. (3) the AAC had not given any decision. In this ground the point made was that section 144B did not apply to an assessment under section 147 and, therefore, the extension of 180 days calculated by the ITO in completing the reassessment on22-9-1976was impermissible in law. He submitted that though in the case of Beta Singh Pabla v. ITO [1982] 1 ITD 370 (Delhi), it was held by the Special Bench of the Tribunal that the provisions of section 144B applied to the assessment under section 147, but this order required reconsideration in the light of the Bombay High Court judgment in D. Swarup, ITO v. Gammon (India) Ltd. [1982] 10 Taxman 159. In Bela Singh Pabla's case, the Tribunal had said that the proceedings under sections 143(3) and 147 were not different, but in Gammon (India) Ltd.'s case, it has been held that the proceedings under section 147 are different from the proceedings under section 143(3). He referr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel for the assessee further submitted that in Bela Singh Pabla's case the Tribunal had relied on the judgment in Kashiram Tea Industries Ltd. v. ITO [1981] 132 ITR 783 (Cal.) wherein it has been held that the provisions of sections 143 and 144 will equally apply to proceedings under section 147, thereby making the assessment a 'regular assessment' within the meaning of section 2(40) of the Act because 'assessment' has been defined in the Act to mean 'reassessment' and 'regular assessment' has not been defined to mean an 'initial assessment'. He pointed out that in this case, the Calcutta High Court followed the view of the Bombay High Court in Deviprasad Kejriwal v. CIT [1976] 102 ITR 180. He submitted that in view of the following observations of the Bombay High Court in the case of Gammon (India) Ltd. the aforesaid judgment of the Calcutta High Court, which had followed the judgment of the Bombay High Court in Deviprasad Kejriwal's case was of no assistance to the revenue as the very foundation in the case of Kashiram Tea Industries Ltd. had been thrown overboard : "9. The words 'regular assessment' which were to be found in sub-section (9) of section 18A of the IT Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a reasonable opportunity of showing cause against such additions or disallowances. 13. For the various reasons mentioned above, he submitted that the view of the Special Bench in the case of Bela Singh Pabla was required to be reconsidered. He relied on the judgment of the Bombay High Court in Universal Ferro Allied Chemicals Ltd. v. P.G.K. Warrier [1982] 11 Taxman 5 and submitted that in the light of the Bombay High Court judgment in the case of Gammon (India) Ltd., the Special Bench order in the case of Bela Singh Pabla should not be followed. 14. No separate arguments were advanced in support of the cross-objection. The arguments advanced, it was pleaded, may be taken in respect of the cross-objection also. 15. In reply, the learned departmental representative relied on the Special Bench order of the Tribunal in the case of Bela Singh Pabla and submitted that the judgment in the case of Gammon (India) Ltd. was a judgment under section 273 and was, thus, not relevant to the issue involved in this case. 16. We have carefully considered the rival submissions. We are afraid, we cannot agree with the learned AAC that the assessment made by the ITO on22-9-1976was required t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under section 147, because the power under section 273 can be exercised only if the ITO "in the course of proceedings in connection with the regular assessment for any assessment year, is satisfied that any assessee has furnished a statement of the advance tax payable by him which he knew or had reason to believe to be untrue". The High Court held that in a reassessment proceeding under section 147, action under section 273 could not be taken. It is true that in the aforesaid judgment it has been held that the reassessment under section 147 is not the same as assessment under section 143 or 144, but these observations have been made in connection with penalty proceedings under section 273. The question whether section 144B would apply to the proceedings under section 147 was not for consideration in that case. All the arguments now raised before us have already been considered by the Special Bench in Bela Singh Pabla's case and we, therefore, do not find any ground to deviate from the judgment in Bela Singh Pabla's case. Even if we were persuaded to agree with the learned counsel for the assessee that section 144B does not apply to an assessment under section 147, then also we c ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
