9911796707
TMI Blog1997 (9) TMI 72X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961, demanding a further amount of Rs. 1,361 after computing the tax and interest payable on the basis of the total income returned by the petitioner. But thereafter by the impugned notice dated October 27, 1992, the Assessing Officer required the petitioner to attend his office at Silchar on November 13, 1992, either in person or by a representative and to produce the books of account, documents and any other evidence on which the petitioner relied in support of the return. On November 13, 1992, the petitioner submitted an adjournment petition before the Income-tax Officer, Ward-II, Silchar, stating therein that as the petitioner's accountant was ill, the matter be adjourned for at least a month. Along with the said adjournment petition, a certificate from the doctor was also filed certifying that the said accountant was suffering from acute bacillary dysentery and was advised to take complete rest for 30 days. The Income-tax Officer, Ward-II, Silchar, however, issued a letter dated November 13, 1992, to the petitioner's firm giving it another opportunity of being heard on December 2, 1992. Along with the said letter, the said Assessing Officer also issued a notice to the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... end of the month in which the return was furnished by the assessee was provided within which the Assessing Officer could serve on the assessee a notice under section 143(2) requiring him to produce or cause to be produced any evidence on which the assessee relied in support of the return. In the facts of the present case, since the return for the assessment year 1990-91 was furnished by the petitioner on March 31, 1992, the said limitation of 12 months for issue of a notice under section 143(2) by the Assessing Officer was to expire on March 31, 1993 and the impugned notice issued by the Assessing Officer on October 27, 1992, was well within the period of limitation. He cited the judgment of the Supreme Court in the case of State of Maharashtra v. Sant Joginder Singh Kishan Singh [1995] Suppl. 2 SCC 475, in which the Supreme Court while deciding a case relating to land acquisition held that determination of compensation by applying the appropriate principle is related to a substantive provision, whereas making of award within the prescribed period is basically procedural. Mr. Joshi accordingly contended that the very Chapter-XIV of the Income-tax Act, 1961, in which section 143 is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intended that the aforesaid proviso was not to apply to the assessment year 1990-91 and was only to apply to the assessment year 1991-92 onwards as contended by Mr. Osmani. However, it is a well-settled principle of law that a provision under a taxing statute should not be so construed as to affect the finality of a tax assessment or to open up a tax liability which had become barred (see ITO v. S. K. Habibullah [1962] 44 ITR 809). The question therefore is as to whether the tax liability of the petitioner for the assessment year 1990-91 had become barred or final and could not be opened by the Assessing Officer under section 143(2) of the Income-tax Act, 1961. The proviso, as it stood prior to its amendment on October 1, 1991, quoted above would show that no notice under section 143(2) could be served on the assessee after the expiry of the financial year in which the return was furnished or the expiry of six months from the end of the month in which the return was furnished, whichever was later. Before October 1, 1991, the petitioner's firm had not filed its income-tax return for the assessment year 1990-91 and hence even under the proviso as it stood prior to its amendment with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that it is a fit case in which the High Court should direct that some Assessing Officer other than the Income-tax Officer, Ward-II, Silchar, should assess the petitioner on transfer of the assessment file to him. Mr. G. K. Joshi, learned counsel appearing for the Income-tax Department, on the other hand, pointed out that under the provisions of section 142(1) of the Income-tax Act, 1961, the Assessing Officer has been vested with the power to require production of books of account relating to a period not more than three years prior to the previous year. Hence, the Assessing Officer was well within his jurisdiction to call for the books of account for the previous two years. Relying on the averments in the affidavit-in-opposition, he further contended that in the return for the assessment year 1990-91 the petitioner had disclosed income by way of interest on money lent. But in the relevant balance-sheet investment in money-lending business was not reflected. The liabilities of the petitioner as shown in the balance-sheet as on March 31, 1990, are relatable to the liabilities of the petitioner as on March 31, 1989, and March 31, 1988. It was for these reasons that the books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer shall not require the production of any accounts relating to a period more than three years prior to the previous year." A reading of the aforesaid provisions of sub-section (1) of section 142 of the Income-tax Act makes it clear that the Assessing Officer has wide powers to call for any books of account from the assessee and the only bar under proviso (b) to sub-section (1) of section 142 of the Act of 1961, is that he will not require production of any accounts relating to a period more than three years prior to the previous year relevant to the assessment year for which enquiry for the assessment is being made. Thus the Assessing Officer was fully within his jurisdiction to issue the impugned notice dated November 13, 1992, requiring the petitioner to produce the books of account relating to the previous years relevant to the assessment years 1988-89 and 1989-90 in the enquiry relating to the assessment for the assessment year 1990-91. In the affidavit-in-opposition, the Income-tax Officer, Ward-II, Silchar, has also shown that the production of the said books of account of the assessee for the previous years relevant to the assessment years 1988-89 and 1989-90 has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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