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TMI Blog2008 (6) TMI 633X X X X Extracts X X X X X X X X Extracts X X X X ..... said assessment. 2. The brief facts are, the petitioner-assessee in the instant case, is doing various types of construction work for the State of Maharashtra, i.e., through P.W.D. or Bombay Municipal Corporation. It appears that the assessee was not maintaining regular books of account, as he had to deal with innumerable persons and on number of occasions cash payments were being made to various labourers etc. 3. Mr. Mistry, the learned Counsel appearing on behalf of the petitioner pointed out that as far as the petitioner-assessee is concerned, the respondent No. 1 had accepted the taxable income to be computed at 8 per cent of the receipts for the assessment years 1980-81 to 1986-87. The appropriate assessment orders were duly passed by the Assessing Officer under Section 143(3) of the Income Tax Act. Mr. Mistry also pointed out, that for all the aforesaid seven assessment years, i.e., 1980-81 to 1986-87, the Department had accepted the aforesaid assessment computed at 8 per cent of the receipts and that they have not challenged the same by way of appeal before the appellate authority or the Tribunal or even before this Court. 4. Mr. Mistry, thereafter pointed out that as far ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nation.-For the removal of doubts, it is hereby declared that, for the purposes of this sub-section,- (a) an order passed on or before or after 1-6-1988 by the Assessing Officer shall include- (i) an order of assessment made by the Assistant Commissioner or Deputy Commissioner or the Income Tax Officer on the basis of the directions issued by the Joint Commissioner under Section 144A; (ii) an order made by the Joint Commissioner in exercise of the powers or in the performance of the functions of an Assessing Officer conferred on, or assigned to, him under the orders or directions issued by the Board or by the Chief Commissioner or Director General or Commissioner authorised by the Board in this behalf under Section 120; (b) "record" shall include and shall be deemed always to have included all records relating to any proceeding under this Act available at the time of examination by the Commissioner; (c) where any order referred to in this sub-section and passed by the Assessing Officer had been the subject-matter of any appeal filed on or before or after 1-6-1988, the powers of the Commissioner under this sub-section shall extend and shall be deemed always to have extende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 263 of the Income Tax Act were issued, were under challenge and pending in this Court, the respondent No. 1 hurriedly went ahead and passed the assessment order dated 9-2-1990. 10. Mr. Mistry contended that under the Amnesty Scheme, the petitioner had approached the Deputy Director of Intelligence (Investigation) and had offered to pay the taxable profit for the assessment years 1980-81 to 1986-87 and he had offered @ 4 per cent of the total receipts. Finally, after discussion with the Deputy Director of Intelligence (Investigation) as well as the Commissioner of Income Tax, it was mutually agreed that the petitioner should file revised return for the assessment years 1980-81 to 1986-87 @ 8 per cent of the receipts. This fact is very clearly recorded in a letter addressed by the petitioner's Advocate dated 26-3-1987, wherein it is clearly mentioned that it was mutually agreed @ 8 per cent of the profit on the total sale proceeds and the receipts realised from the sale. This letter was addressed to the Commissioner of Income Tax, Bombay City-X, Bombay. This fact has not been disputed by the respondents also. It appears that thereafter the Income Tax Authority made various inve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore contended that the Appellate Authority, while following the superior's directives could not be construed either "erroneous" or "prejudicial to the interest of revenue". Mr. Mistry also emphasised that if the Income Tax Department had accepted for 19 years, i.e., from 1986-87 to 2004-05 at 8 per cent, then how it can be said as "erroneous" for the earlier years. He contended that the error means it should be unsustainable in law and in the instant case, no such error is pointed out. In that behalf Mr. Mistry relied on a judgment of our High Court in the case of CIT v. Gabriel India Ltd. [1993] 203 ITR 108 (Bom) , wherein, this Court had in certain terms held that erroneous means deviating from the law, erroneous application of legal principles, i.e., to say it was not in accordance with law. The said judgment proceeds further and states that if the Income Tax Officer while acting in accordance with law makes certain assessment, the same cannot be branded as "erroneous" by the Commissioner simply because, the order should have been written more elaborately. Similarly, the said judgment also states that the Commissioner, on perusal of the records, may be of the opinion th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mumbai by his letter dated 30-11-1987. If the assessment order was as per the directives of the Commissioner of Income Tax, the subsequent Commissioner of Income Tax could not have exercised the power of revision under Section 263 of the Income Tax Act. Mr. Mistry emphasized, that in the instant case, the order dated 30-11-1987 was issued by the second Commissioner of Income Tax, considering the original Commissioner of Income-tax's decision to have 8 per cent and even the second Commissioner of Income Tax found the same to be fair. Under the aforesaid facts and circumstances of the case, Mr. Mistry submitted that the impugned notices dated 9-2-1990 as well as impugned assessment orders dated 13-3-1990 are liable to be quashed and set aside. 16. Mr. Sahadevan, the learned Counsel appearing on behalf of the revenue fairly admitted that the aforesaid letter dated 30-11-1987 was not even dealt with when the impugned notices were issued for revision under Section 263 of the Income Tax Act and while passing assessment orders during the pendency of this petition. Mr. Sahadevan also could not controvert, that as it was apparent from the record that the original Commissioner of Income ..... X X X X Extracts X X X X X X X X Extracts X X X X
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