9911796707
TMI Blog1989 (4) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... ivered by R. S. PATHAK C. J. I. -These appeals by special leave are directed against the judgment of the High Court of Andhra Pradesh answering the following two questions of law in favour of the Revenue and against the assessee : "(1) Whether the Tribunal was right in holding that the reassessments being only consequent to a change as to the method of computation of the profits, the initiation of proceedings under section 148 for each of the assessment years 1959-60 and 1960-61 was justified ? (2) Whether the Tribunal was right in law in holding that the original assessment for each of the years having been made on the agents, the real assessment proceedings could not be initiated against the assessee direct ?" The appellant asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same basis for the assessment year 1960-61, after setting off the income against the previous loss, the total loss was found to be Rs. 96,482. Subsequently, in the course of assessment proceedings for the assessment year 1962-63, the Income-tax Officer appears to have noticed that a mistake had been committed in the computation of the overhead expenditure. The return filed on behalf of the assessee for that year had disclosed that the overhead expenses were attributable to the entire business of the assessee, including the business as commission agents, and not merely for the business of purchase and sale of tobacco. The Income-tax Officer believed that he ought to have first computed the proportionate overhead expenses in relation to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Officer rejected the objections and made reassessments on the assessee for the two assessment years. The appeals filed by the assessee before the Appellate assistant Commissioner were dismissed, but in second appeal, the Income tax Appellate Tribunal took the view that the reassessments proceeded on mere change of opinion on the part of the Income-tax Officer and, therefore, were without jurisdiction, and further as the assessments had been made originally on the agents, it, was not open to the Income-tax Officer to proceed directly against the assessee. Accordingly, the Appellate Tribunal allowed the appeals and set aside the reassessments made on the assessee. At the instance of the Revenue, the Appellate Tribunal referred the two ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax Officer came to realise that income had escaped assessment for the two assessment years when he was in the process of making assessment for a subsequent assessment year. While making that assessment, he came to know from the documents pertaining to that assessment that the overhead expenses related to the entire business including the business as commission agents and were not confined to the business of purchase and sale. It is true, as the High Court has observed, that this information could have been acquired by the Income-tax Officer if he had exercised due diligence at the time of the original assessment itself. It does not appear, however, that the attention of the Income-tax Officer was directed by anything before him to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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