9911796707
TMI Blog1988 (6) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... wo questions of law have been referred to this court under section 256(2) of the Income-tax Act, 1961, for the assessment year 1959-60 : 1. "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the reassessment proceedings under section 147(b) of the Income-tax Act, 1961, were infructuous and invalid ? 2. Whether, on the facts and in the circumstance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment as revenue expenditure. Accordingly, the relevant assessment was reopened under section 147(b) of the Income-tax Act, 1961. It was contended before the Income-tax Officer that the looms were included in machinery purchased prior to April 1, 1949, and the break-up figures for looms could not be made available. The Income-tax Officer, however, disallowed a portion, that is, Rs. 476, out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made in consideration of acquiring an opportunity to earn profits was not expenditure of a revenue nature. As a result, the sum of Rs. 2,21,331 was included in the reassessment order. Being aggrieved, the matter was taken up in appeal before the Appellate Assistant Commissioner challenging the legality and the propriety of the reassessment proceedings on the ground that all the material facts re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Income-tax Officer's action in view of a circular dated May 28, 1948, issued by the Central Board of Revenue. As regards the purchase of loom hours, he held that the addition was made on a mere change of opinion. As a result, the reassessment made under section 147(b) was annulled by him as being infructuous and invalid. The Department became dissatisfied with the Appellate Assistant Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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