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TMI Blog1991 (12) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the Appellate Assistant Commissioner had no jurisdiction to consider and decide the question that the relevant proceedings and reassessment were invalid and beyond the scope of section 147(a) ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the scope of the relevant appeal before the Appellate Assistant Commissioner under section 246(c)of the Income-tax Act, 1961, did not permit consideration and decision on the legality of reassessment proceedings taken under section 147(a) ? The assessee is a registered firm. Its original assessment for the assessment year 1965-66 was completed on a total income of Rs. 67,200. The total income of the assessee was finally assessed at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions were made on behalf of the assessee before the Appellate Assistant Commissioner, one of which was as follows : " That the Income-tax Officer erred in treating the Delhi branch of U. B. S. Publishers and Distributors, Delhi, as a branch of the appellant even though the Income-tax Appellate Tribunal, Allahabad, had accepted the Delhi firm to be a genuine firm and also granted registration to the Delhi firm." The validity of the assessment was also challenged on the ground that the assumption of jurisdiction under section 147 was unauthorised and illegal. The Appellate Assistant Commissioner accepted the submissions of the assessee and observed that the Income-tax Appellate Tribunal, Delhi, vide its order dated September 17, 1974, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Department holding that, in an appeal under section 246(1)(e) against the order passed by the Income-tax Officer under section 144 of the Act, it was not competent to the Appellate Assistant Commissioner to consider the validity of the assessment. In order to appreciate the question, it would be necessary to have a look at the relevant statutory provisions. Section 246(1), in so far as is material. for our purpose and as the same stood at the relevant time, states : " Subject to the provisions of sub-section (2), any assessee aggrieved by any of the following orders of an Assessing Officer may appeal to the Deputy Commissioner (Appeals) against such order-. . . . (b) an order imposing a fine under sub-section (2) of section 131 ; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an assessment or reassessment under section 147, the same procedure or machinery for making an assessment under section 143 or for making a best judgment assessment under section 144 is to be followed. Irrespective, however, of whether the provisions of section 143 or section 144 are followed, the assessment made in proceedings initiated under section 147 would be a separate and distinct category at least so far as an appeal under section 246(1)(e) is concerned. Such an order cannot obviously be equated for all purposes with an assessment made in accordance with section 143 or 144 simpliciter. This will be apparent from a mere glance at clause (e) of section 246(1). Orders of assessment or reassessment under section 147 have been, for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t or reassessment initiated under section 147 after following the procedure laid down under a provision like section 144, it shall stand restricted and confined only to an objection as to the quantum of income assessed or tax determined or that the validity of the assessment cannot be challenged in such an appeal on the ground that section 147 was illegally invoked or that the assessment was wrongly sought to be reopened under section 147 of the Act. Upon the plain terms of clause (e) of section 246(1), all possible grounds can be urged in an appeal against an order of assessment under section 147. Further, in construing section 246, it must be remembered that there has been a significant departure from the scheme of the 1922 Act. Under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the enactment with which we are directly concerned ; secondly, the statutory provisions of the Income-tax Act stressed by us are vitally different from those of U. P. Sales Tax Act. This will be apparent from a simple comparison of section 246 of the Income-tax Act with section 9 of the U. P. Sales Tax Act. Under the U. P. Act, all orders made by the assessing authority have been made appealable whereas, under the Income tax Act, 1961, orders of assessment and reassessment passed under section 147 have been put in a separate category, a feature completely absent in the U. P. Act. The same conclusion flows from an examination of jute Corporation of India Ltd. v. CIT [1991] 187 ITR 688 ; [1990] 4 JT 346 (SC). The case throws considerabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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