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TMI Blog2007 (5) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... but a financial agreement by which money was lent and advanced by the assessee to the State Electricity Board on the said electric meters. Accordingly, the Assessing Officer disallowed assessment on the rental income. The Assessing Officer calculated the notional interest on the principal sum as and by way of interest income and assessed tax on the said basis. The assessee preferred an appeal before the Commissioner of Income-tax (Appeals). The appellate authority asked the Assessing Officer to determine the market value of the said electric meters and submit a report. Accordingly, the Assessing Officer submitted his report. On the basis of the said report the appeal was allowed by allowing depreciation on Rs. 11.38 crores being the book value of the said meters and not Rs. 35.10 crores as prayed for by the assessee. The assessee approached the Tribunal. The Tribunal by an order dated December 31, 2001, set aside the order of the Commissioner of Income-tax (Appeals) as well as the order of the Assessing Officer and remanded the matter back to the Assessing Officer for deciding the issue afresh on the basis of the materials so produced by the assessee not only on the depreciation bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... depreciation has been taken care of and after considering every thing a refund order has been passed, so it reaches its finality. I have examined the order carefully and I hold Mr. Ghosh is right in saying the order does not relate to any decision on the issue of depreciation or the expenditure on account of the foreign tour of Mrs. J. Thapar. I have already quoted the direction of the Tribunal upon the Assessing Officer. It is clear that the Assessing Officer is to decide upon fresh hearing on these two issues. Therefore, the contention of Mr. Murarka that this order being a final one and on fresh decision of the aforesaid two issues is not correct From the order dated February 12, 2002, it does not appear the Assessing Officer has heard the assessee/petitioner or touched the issue not to speak of deciding the same. So, I hold that irrespective of the effect and implication of the order dated February 15, 2002, the Assessing Officer has to decide afresh, pursuant to the direction of the Tribunal and this cannot be left outstanding in any manner whatsoever. According to him if it is not done the same tantamounts to gross breach of discipline in the quasi-judicial proceedings. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd order of the learned single judge the assessee preferred the instant appeal. The Division Bench while admitting the appeal permitted the Revenue to proceed with the assessment in terms of the order of the Tribunal so directed by the learned single judge. Accordingly, the Assessing Officer passed an order on August 3, 2005, allowing depreciation to the extent of Rs. 11.38 crores and thereby disallowing Rs. 23.71 crores. The Assessing Officer also disallowed the claim on account of foreign travel expenses to the extent of Rs. 2,00,746. The said order was, however, not officially communicated to the assessee in view of pendency of this appeal. 7 The above appeal was heard by us on the abovementioned dates. 8 Mr. R. Murarka, learned counsel appearing for the assessee contended as follows: (i) When the Tribunal directed the Assessing Officer to adjudicate the issue afresh on account of depreciation and foreign travel allowance the Assessing Officer was duty bound to complete the assessment along with the issue of sales tax pending before him. Hence, the order dated February 12, 2002, was a composite order passed by the Assessing Officer, inter alia, under section 254 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s first examine the appropriate provisions of the Act of 1961. 12 Section 142 empowers the Assessing Officer to ask for further details after a return is submitted under section 139. Such act was permissible before the original assessment under section 143. 13 Under section 143, an assessment was to be made by the Assessing Officer on the basis of the return so submitted under section 139 and/or the particulars so submitted by the assessee under section 142(1). 14 Section 147 empowers the Assessing Officer to reopen an assessment if he is of the opinion that there has been an escapement of assessment of income which escaped the attention of the Assessing Officer at the time of passing order under section 143 in view of concealment by the assessee which comes to the notice of the Assessing Officer subsequently to the passing of the order under section 143. 15 Section 148 gives power to the Assessing Officer to issue notice for reopening of the assessment under section 147. 16 Section 154 empowers the Assessing Officer to correct his own mistake as crept in while passing an order under section 143. 17 Section 254 empowers the Appellate Tribunal to pass appropr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as brought to his notice he was not authorized to keep those issues pending by resolving the controversy with regard to the sales tax only. 22 Now, comes the question as to what was the right procedure to be adopted to rectify such mistake. In our considered view, the notice impugned in the writ petition should be considered as a notice under section 154 read with section 254. Mr. Shome argued that it was a notice under section 142(1). Such argument was in desperation, in our view. The learned single judge held that it was a case of escapement of assessment of income meaning thereby a situation contemplated under section 147. We are not in a position to accept such view. 23 In a case under section 147 there might be imposition of interest and penalty on the assessee as such escapement of assessment of income might be due to omission on the part of the assessee to produce appropriate materials before the Assessing Officer. In a case under section 147 the Assessing Officer might come to a finding that such escapement was due to the fault on the part of the assessee. Under section 154 no fault could be attributed to the assessee as this power was given to the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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