9911796707
TMI Blog1986 (7) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent No. 1 herein), on perusal of the returns and while passing the assessment orders, took the view that the petitioner did not maintain a day to day stock-book in respect of materials consumed in both the businesses and that in the absence of the same, it was not possible to verify the book results and that it was necessary to ascertain the book results on the basis of estimates. The gross profit shown by the petitioner in respect of construction business was 13.77%, 14.63% and 16.35% for the three years' respectively, while the Income-tax Officer estimated it at the flat rate of 17.5% for all the years. The gross profits shown by the petitioner in respect of electrical business was 11.64%, 11.82% and 22.87%, respectively, for the releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In pursuance of the order passed by the Commissioner of Income-tax, the Income-tax Officer passed fresh orders of assessment in respect of the relevant assessment years on September 28, 1979. The petitioner carried appeals against the orders passed by the Income-tax Officer, but they were dismissed by the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax held that it was not open to the petitioner to challenge the orders passed by the Commissioner of Income-tax in exercise of powers under section 263 of the Income-tax Act. According to the appellate authority, the orders under section 263 have become final as the petitioner did not prefer an appeal against the said order before the Income-tax Appellate Tribunal. The ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction and the orders under section 263 of the Act are null and void. Learned counsel urged that the Commissioner of Income-tax could not have exercised the revisional powers conferred under section 263 of the Act when the order of the Income-tax Officer had merged in the order passed by the Appellate Assistant Commissioner of Income-tax. Shri Pandit also submitted that the Tribunal had taken a technical view in not condoning the delay and not hearing the appeals against the orders of the Commissioner of Income-tax passed under section 263 of the Act. There is considerable merit in the submission of learned counsel. Section 263(1) of the Income-tax Act reads as under: " 263. (1) The Commissioner may call for and examine the record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any part of the order of the Income-tax Officer is not challenged, then that part of the order is open for revision by the Commissioner of Income-tax. Shri Jetly, learned counsel appearing on behalf of the Department, submitted that the Commissioner of Income-tax exercised the power to ascertain whether the expenses claimed by the petitioner are of trading nature and that was not an aspect which was considered by the Appellate Assistant Commissioner. The submission is not correct. The order under section 263 of the Act clearly sets out that the point for consideration was that the payments made to Kampani and M/s. Architect Combine were expenses of trading nature and, therefore, deemed to have been covered by the estimate of gross profits. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hout merit. The Tribunal held that the petitioner ought to have filed an application for condonation of delay duly supported by an affidavit at the time of presentation of appeal, but instead of that, merely appeals were lodged and an affidavit of a partner of the firm was tendered only when the objection was raised about the delay in filing the appeals. It is undoubtedly true that the explanation given in the affidavit for delay in lodging the appeals is not very substantial, but, in my judgment, taking into consideration the fact that the revisional authority had acted without jurisdiction, was enough for the Tribunal to condone the delay and entertain the appeals. It is true that the Tribunal could not entertain the appeals beyond the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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