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TMI Blog1992 (9) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax Act ? (2) Whether the assessment made in the instant case was time-barred as it was made after the time-limit available under section 153(2) of the Income-tax Act, 1961 ? (3) Whether the provisions of Explanation 1(iv) to section 153 of the Income-tax Act, 1961, had any application to the facts of the instant case ? (4) Whether, in the facts and circumstances of the case, the Tribunal was right in dismissing the Appeal No. 300/(Nag) of 1977-78 filed against the order of the Appellate Assistant Commissioner under section 154 dated April 18, 1977, without going into the merits thereof ?" These four questions arise out of the common order of the Tribunal dated July 28, 1978, passed in I. T. A. Nos. 214/(Nag) of 1977-78 and 300/(N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons contending that the assessment was barred by time. The contention was that the assessment under section 147(a) ought to have been completed before the expiry of four years from the end of the assessment year in which the notice under section 148 was served as provided under section 153(2). The notice was served in the assessment year 1971-72, and, hence, the assessment could not have been made after March 31, 1976. The Revenue's contention was that section 144B applied and since resort to those provisions was made, the time-limit got extended by a period of nearly six months in view of Explanation 1(iv) to section 153 and hence the assessment made on September 22, 1976, was within time. The Tribunal accepted the interpretation canvassed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requiring the Income-tax Officer to send a draft assessment order to the assessee, to start with, in all cases where the additions or disallowances proposed to be made in an assessment under sub-section (3) of section 143 exceed in the aggregate Rs. 25,000. Where the taxpayer objects to the assessment being made on the basis of the draft order, he should intimate his objections within seven days to the Inspecting Assistant Commissioner who will, after hearing the assessee and the Income-tax Officer, pass the final order of assessment himself. For this purpose, the Inspecting Assistant Commissioner should have the power to accept, reduce, or enhance the income proposed in the draft order. Such a measure will also ensure that major disputes w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reassessment and in section 147 (as it stood then) its meaning is restricted. Section 147 empowers the Income-tax Officer to proceed de novo in the case of escaped income. Once the assessment is reopened the previous assessment ceases to exist and fresh assessment proceedings commence. In some respects it may lead to a supplementary assessment and in others it may result in reassessment for the first time. But in no case are the proceedings separate or distinct from the original assessment proceedings. It is of extreme importance to keep in mind the basic principle that for one year there can be only one assessment of an assessee in the same status. Section 147 is not a self contained code and assessment made under that section has also to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Delhi High Court in the case of R. Dalmia v. CIT [1992] 194 ITR 700 (Delhi). The literal view based only on the absence of reference to section 147 in section 144B is taken by the Punjab and Haryana High Court in the case of CIT v. Usha Aggarwal [1989] 178 ITR 406. The Bombay High Court had occasion to deal with the scheme of section 147 though in the context of a best judgment assessment under section 144 in the case of R. B. Seth Shreeram Durgaprasad and Fatechand Narsingdas (Export) Firm v. CIT [1988] 170 ITR 23. We notice in that judgment identity of our approach. Following observations are worth noticing (at page 25) : "At the outset, it must be noted that under the provisions of section 147 of the Income-tax Act, 1961, if the Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rong reliance was placed on behalf of the assessee upon the decision of the Bombay High Court in the case of D. Swarup, ITO v. Gammon India Ltd. [1983] 141 ITR 841, wherein it has been held that no penalty could be levied under section 273 on the basis of reassessment under section 147 because regular assessment does not cover reassessment under section 147. That decision was also brought to the notice of the Bench which decided R. B. Seth Shreeram Durgaprasad and Fatechand Narsingdas (Export) Firm's case [1988] 170 ITR 23 (Bom), but its ratio was not applied to an assessment under section 144 on the ground that the context of the two provisions was dissimilar. Our attention was also invited on behalf of the assessee to sections 214, 215, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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