9911796707
TMI Blog1996 (2) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... our opinion: " Whether, on the facts and in the circumstances of the case and on a proper construction of sections 143(1) and 143(2)(b) of the Income-tax Act and Instruction No. 1617, dated May 18, 1985, issued by the Central Board of Direct Taxes, the Tribunal was justified in holding that the assessment completed under section 143(1) could be reopened under section 143(2)(b) otherwise than procedure for scrutiny of five per cent. cases laid down in the said instructions ? " Briefly stated, the facts of the case are that the year of assessment is 1985-86. The assessee is a firm. The assessment was initially completed under section 143(1) of the Act on December 24, 1985, accepting the returned income of Rs. 90,084. The assessment was, ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstructions, it was argued by the assessee before the Tribunal that the assessment under section 143(1) was final and was open to scrutiny only in the manner provided in the instructions and recourse to section 143(2)(b) of the Act was not permissible. The Tribunal did not accept the contention and observed that the instructions could not make the provisions contained in section 143(2)(b) of the Act non-existent. The Tribunal, therefore, dismissed the appeal. Aggrieved, the applicant filed the application under section 256(1) of the Act. On that application, the Tribunal stated the case and referred the aforesaid question. We have heard Shri Nazir Singh, learned counsel for the applicant/ assessee, and Shri D. D. Vyas, learned counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer considers it necessary or expedient to verify the correctness and completeness of the return by requiring the presence of the assessee or the production of evidence in this behalf. " Now, this has been superseded by the Taxation Laws (Amendment) Act, 1970, with effect from April 1, 1971, and later on amended by the Finance Act, 1974, with effect from April 1, 1975, the Finance Act, 1976, with effect from April 1, 1976, the Finance (No. 2) Act, 1980, with effect from April 1, 1980, and the Finance Act, 1987, with effect from April 1, 1988. Prior to these, the provisions had stood as noted above. We may usefully quote Herbert Broom's Legal Maxims : " Qui haeret in litera haeret in cortice (Co. Litt. 283 b.)--- ' In interpreti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dislodge the aforesaid provision. The recourse to the aforesaid provision had depended on the satisfaction of the Assessing Officer, whereas recourse to the instruction was permissible in conformity with the procedure laid down for the purposes of scrutiny of cases, restricted to five per cent. in number, on random sample basis. The purpose of the instruction was to provide extra check and scrutiny to eliminate the chances of incorrectness or evasion of the taxes in any manner. Luculently the instruction did not control the aforesaid provision, permitting reopening of the assessment and did not render it otiose. In Bengal Iron Corporation v. CTO [1993] 90 STC 47 ; AIR 1993 SC 2414, it is held as under : "Clarifications/circulars issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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