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TMI Blog1967 (8) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... District, New Delhi, the Commissioner of Income-tax, Delhi, and the Secretary, Central Board of Direct Taxes, New Delhi, as respondents in this petition. The petitioner in his petition states that during the financial years 1943-44 and 1944-45, the petitioner derived his income mostly from contracts and he undertook the contract of construction of W.A.C. quarters at Lytton Road, New Delhi ; the work for constrution of the said quarters was stated on November 4, 1943, and was completed some time in May, 1944 ; during the time when the work was in progress, the petitioner received part of the payments in the financial year 1943-44, relevant to the assessment year 1944-45, and the remaining in the financial year 1944-45, relevant to the assessment year 1945-46 ; on January 25, 1945, the Income-tax Officer, Contractor Circle, New Delhi, made an assessment of the petitioner for the assessment year 1944-45, but as some of the income was relevant to construction work which was not completed, the said assessment was made on tentative basis subject to adjustment in the year when the construction was completed ; in pursuance of the aforesaid order a sum of Rs. 20,348-5-0 was paid as tax in M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction of the Income-tax Officer to take any further proceedings on the notice under section 22(4) of the Act on the ground that the assessment for the year 1945-46 had already been completed in February, 1954. The judgment of a Bench of Punjab High Court at Delhi in the said writ petition is reported as S. Sewa Singh Gill v. Commissioner of Income-tax. According to the petitioner, the High Court in that case decided that the assessment order of February, 1951 for the assessee at year 1945-46 was the final assessment order and the issue of fresh notices under section 22(4) of the Act to the petitioner was illegal. It may be stated that it is this judgment of the High Court which provided the basis for the petitioner to file the present writ petition. Before I consider the contention of the petitioner in this writ petition it is desirable to mention certain facts as borne out by the records. As I pointed out already, for the assessment year 1941-45, the Income-tax Officer passed an order of assessment purporting to be under section 23(2) of the Indian Income-tax Act, 1922, on January 25, 1945. The relevant portion of the assessment order is as follows : " I have discussed the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Government to the contractor. After deducting the cost of such material, which amounted to about Rs. 80,000, the net payments received by the assessee in the year of account amounted to Rs. 1,65,638. The assessee returned a profit by estimating it at 10% of the actual payments received from the Government. The Income-tax Officer applied a flat rate of 18% on Rs. 2,45,638. This figure includes the deductions made for the supply of material to the contractor. There is no dispute as regards the application of the proviso to section 13 as the assessee himself estimated his profit at 10%. The only ground urged is that the estimate made by the Income-tax Officer is excessive. We agree with the Income-tax Officer that the total contract work done by the assessee for which he received the payments was of the value of Rs. 2,45,638 and not Rs. 1,65,638. No case has been made out by the representative of the assessee that the estimate made by the Income-tax Officer was excessive or arbitrary. We are satisfied that considering the market conditions prevailing at the material time the estimate made is fair and reasonable. The appeal is dismissed. " From this it will be seen that the ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... based upon the use of the expression " tentative " occurring in the order dated January 25, 1945. Once the learned counsel for the petitioner realised that section 23B itself was not in the statute book on the date when the order was passed and was introduced only in 1949, he gave up that contention. Thereafter, his only contention was that after the order was passed in February, 1954, determining the profits relevant for the year 1944-45 as Rs. 1,818, it was the duty of the Income-tax Officer to proceed under section 35 of the Act and to revise the order already passed by him on January 25, 1945. In reply to this contention, Shri D. K. Kapur, appearing for the respondent, submitted that the assessment order dated January 25, 1945, has been made the subject matter of appeals before the Appellate Assistant Commissioner as well as the Tribunal and the petitioner cannot ask the Income-tax Officer to revise the order passed by him on January 25,1945, in view of the express provisions contained in section 35(1) and (2) of the Indian Income tax Act, 1922. Section 35(1) provides that the Commissioner or the Appellate Assistant Commissioner may, at any time within four years from the date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry of the period and a person like the petitioner can be denied relief only if there has been inaction or laches or delay on the part of the petitioner and when the petitioner cannot be said to be guilty of any such thing, be cannot be denied the relief to which he is entitled. In support of his contention that notwithstanding the expiry of the period prescribed for the performance of a duty by a public officer, still it is open to the court to issue a writ of mandamus to the said public officer asking him to perform the duty, be relied upon a passage in Halsbury's Laws of England, 3rd edition volume II, page 91, paragraph 172. The passage is to the following effect : " If public officials or a public body fail to perform any public duty with which they have been charged, an order of mandamus will lie to compel them to carry it out, even though the time prescribed by statute for the performance of the duty may have passed. " This statement of law is based upon a decision in R. v. Revising Barrister for the Borough of Hanley. In view of the conclusion I have come to regarding the first point based, upon the merger of the orders of the Income-tax Officer and the Appellate Assi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered in that appeal, could not be regarded as having been adjudicated upon by the Tribunal by implication and so having merged in the Tribunal's order. " The learned judges further observed that the jurisdiction of the Tribunal was confined to dealing with the subject-matter of the appeal and the subject-matter of the appeal was constituted by the grounds of appeal preferred by the appellant. In Kalooram Tirasilal's case, for the assessment year 1956-57, the Income-tax Officer had rejected the explanation of the assessee in regard to an item of cash credit in its account books and treated a sum of Rs. 40,000 as income from undisclosed sources and added to this the income of the assessee from the registered firm, from house property and from business, and the business loss carried forward from the assessment year 1955-56 was set off against the total. On appeal, the Appellate Assistant Commissioner reduced the quantum of income from undisclosed sources to Rs. 30,000. The matter was taken up in further appeal to the Tribunal. When the appeal was pending before the Tribunal, the Income-tax Officer initiated proceedings under section 35 of the Income-tax Act, 1922, and rectified the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was left out from the subject-matter of the appeals before the two authorities concerned. In my view, the order of the Income-tax Officer, dated January 25, 1945, had to deal with three aspects : (i) the liability of the petitioner to be assessed for that year even though the contracts taken by him were not completed during that year ; (ii) the liability of the petitioner to be assessed on the total amount received by him plus the estimated cost of materials ; and (iii) the percentage to be applied on the total amount for the purpose of estimating the profits of the petitioner for the relevant year. As far as the first aspect is concerned, I must proceed on the basis that when the petitioner offered to be assessed at the rate of 10% on Rs. 1,65,638 he had admitted his liability to be taxed for that year. As a matter of fact, in view of the decision of the Patna High Court in Sri Sukhdeodas Jalan v. Commissioner of Income-tax there could not be any dispute or doubt about the liability of the petitioner to be assessed for that year and as a matter of fact, the learned counsel for the petitioner did not dispute that liability. Once this is excluded, what remained were the to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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