9911796707
TMI Blog1981 (11) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... nt previous year for the assessment year 1971-72 concerned is the calendar year ended 31-12-1970. The original assessment was made by the ITO by his order dated 30-12-1972 in which besides accepting the loss before depreciation as declared by the assessee, be allowed a much larger depreciation at Rs. 1,14,90,686 as against Rs. 42,07,763 claimed by the assessee in a revised return on the ground that the assessee is entitled to claim depreciation on all the eight vessels, whose earnings are subject-matter of assessment for the whole year according to the provisions of the Income-tax Act instead of its claim on time basis which would not be in order. According to the reassessment order made in this case, subsequent to the completion of the ori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s given to the ITO under rule 10 and the ITO has adopted in the original assessment the third option which was open to him. The fact that the present ITO who made the reassessment felt that the method adopted by the previous officer is not correct and it should have been completed by applying the method No. 2 cannot, it was held, be the basis for reopening the assessment in accordance with the decision of the Supreme Court in Simon Carves Ltd. 4. In the further appeal preferred by the department it is vehemently urged on behalf of the department by the learned standing counsel that in the original assessment made by the ITO he totally failed to apply his mind to a proper determination of the income and has merely gone by the figures of lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the other hand, contended that in the facts or this case the reassessment was passed only on a review or change of opinion with regard to the basis of assessment and, therefore the reopening was not justified. Besides relying on the decision of the Supreme Court adverted to by the AAC in the case of Simon Carves Ltd., he also sought support on the decision of the Supreme Court in Indian Eastern Newspaper Society v. CIT [1979] 119 ITR 996. 5. On a careful consideration of the facts on the submission of the parties, we are satisfied that there is merit in the department's objection. The AAC has relied on the decision of the Supreme Court in Simon Carves Ltd. on the assumption that what the ITO has done in this case in the original assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ronounce on the law, it can nevertheless draw the attention of the ITO to the law declared and the knowledge or awareness of the law may be communicated by anyone. In this decision it is also held that the observation of the Supreme Court in Kalyanji Mavji Co. v. CIT [1976] 102 ITR 287 is stated too widely and travels further that what the statute warrants insofar as it can be said to lay down that, if on reappraisal of the materials considered by him during the original assessment, the ITO discovers that he has committed an error in consequence of which income has escaped assessment, it is open to him to reopen the assessment and that an error discovered on a reconsideration of the same material (and no more) does not give him that power ..... X X X X Extracts X X X X X X X X Extracts X X X X
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