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TMI Blog1978 (7) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... ve and learned counsel for the assessee. The learned departmental representative relied upon the decision of the Madras High Court in the case of CIT vs. Seth Manicklal Fomra(1) (By L. Rs.), and pointed out that the AAC has no authority to set aside the assessment partially. He submitted that the AAC ought to have remanded the case to the ITO or decide the assessee's claim on the merits of the case and he ought not have set aside the assessment. The learned counsel for the assessee on the other hand supported the orders of the AAC. 3. While dealing with the claim of the assessee company in respect of the loss said to have been incurred by the assessee company on the revaluation of the foreign currency comprising of the company's borrowi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as. For the Asst. yr. 1961-62 the ITO determined the income from the cloth business on the basis of the books of account at Rs. 8,204. In respect of sugar business the ITO estimated the income in the absence of regular books of account at Rs. 15,000. The assessee went up in appeal before the AAC against the estimate made in respect of sugar business. The AAC set aside the order of the assessment and directed the ITO to re-do the assessment in the light of observation contained in his order. In making the reassessment the ITO repeated the estimate of the income from sugar at Rs. 15,000 as was done originally. Besides he made another addition of Rs. 87,595 as income from other sources based upon the wealth statement which he called upon the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es the High Court held that if the order of the assessment is set aside and the ITO is directed to make a fresh assessment the power of Income Tax Officer has to be exercised with reference to the provisions of s. 143(3) and not with reference to any observations made by the AAC in his order. In the instant case, as pointed out above, there is no direction by the AAC to re-do the entire assessment. Only the finding on the issue relating to the claim of laws in exchange of the company's money on foreign was set aside and the assessment has been directed to be re-done, on this issue. This is clear from the operative part of the AAC's order which says that the assessment is set aside for the above limited purpose. In this view of the matter we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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