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TMI Blog1985 (7) TMI 171X X X X Extracts X X X X X X X X Extracts X X X X ..... s duty was strictly to comply with the directions of the ITAT which he had done in the instant case. The CIT (A) was, therefore, not justified in setting aside the order of the ITO for not following the provisions of s. 144B and holding that the same is mandatory. According to Mr. Singh, the substance is more important than the nomenclature for which proposition he relied on Punjab State Cooperative Supply marketing Federation Ltd. vs. CIT (1980) 18 CTR (P H) 71 : (1981) 128 ITR 189 (P H). 3. Mr. G. D. Gargieya, the ld. counsel for the assessee submitted that the direction of the ITAT was limited to the considerations of the facts and pass an order again. ITAT can never suggest to overrule the mandatory statutory provision and as it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lacence of law. He relied on Kundan lal Maru vs. CIT (1982) 135 ITR 84 (MP) for the proposition that once an order has been set aside, the original Tribunal s order becomes non-est. He also relied on Tribunal s judgment reported in 8 Taxaman 41 (Bom-Trib). He also relied on P. V. Doshi vs. CIT 113 (1978) ITR 22 (Guj). He further pointed out that certain additional facts which were brought before ITO have a so been totally disregarded by him. According to Mr. Gargieya, the ld. CIT (A) must have quashed the order and held the same to be illegal and invalid. 4. Mr. Gargieya also submitted the facts: 188 kg of stones found in the premises of the assessee and finally accepted by the tax authorities as belonging to the sister concern M/s Indo F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y toe indicate that the assessment made earlier has been vacated and therefore is non-est from the date of the order of this Tribunal. The Madhya Pradesh High Court in the case of Kundanlal Maru vs. CIT (1982) 135 ITR 84 (MP) has categorically held on an identical issue that once an order has been set aside by the appellate authorities, the original order becomes non-est. The natural corallory that follows is that earlier directions under s. 144B given during the original proceeding also becomes non-est as the IAC s directions merges into the ITO s order, as it is against ITO s order the assessee had preferred appeal to appellate authorities. 7. The second question which arises at this juncture is- "Whether while following the direction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period aforesaid or the assessee intimates to the ITO shall complete the assessment on the basis of the draft order. (4) If no objections are received, the ITO shall forward the draft order together with the objections to the IAC and the IAC shall, after considering the draft order and the objections and after going through (wherever necessary) the records relating to the draft order, issue, in respect of the matters covered by the objections, such directions as he thinks fit for the guidance of the ITO to enable him complete the assessment: Provided that no directions which are prejudicial to the assessee shall be issued under this sub-section before an opportunity is given to the assessee to be heard. (5) Every direction issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so held that compliance of provisions of s. 144B is mandatory. 13. Similar view has also been taken by Their Lordships of the Gujarat High Court in the case of Mrs. Meera Ben P. Desai vs. Union of India Others (1981) 130 ITR 922 (Guj). 14. Therefore, there can be denial that ITO must comply with the provisions of s. 144B while taking an assessment or reassessment. 15. The next important question that arises is (a) when ITO fails to comply with the provisions of s. 144B whether the CIT (A) was justified to set aside the ITO s order and direct him to comply with provisions s. 144B and redo the assessment? Their Lordships of the Supreme Court in the case of Y. Narayan Chetty vs. ITO (1959) 35 ITR 388 (SC) while considering an iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e totally invalid. When he had lacked the jurisdiction and his order being anullity in view of the above mentioned orders of the Supreme Court and the High Court, which we respectfully follow, we hold that the CIT(A) was not at all justified in direction and in his attempting to confer on the jurisdiction on the ITO to redo the assessment. We, therefore, quash his order for his direction to redo the assessment and hold that the assessment made by ITO is without jurisdiction and is invalid and bad in law. Similar view has been taken by Bombay Bench in the case of Rajendra vs. ITO 8 Taxman 61 (Bom Trib). The Bombay Bench of the Tribunal in the case of Third ITO vs. Shivaji Park Gymkhana (1983) 4 ITD 462 (Bom) considered this very issue and al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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