9911796707
TMI Blog1983 (12) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... ses were remanded to the ITO some time in the year 1949. While the appeals were pending before the AAC, certificate of recovery was issued on September 3, 1958, and accordingly recovery was made from certain debtors of the petitioner. After the receipt of the remand report, the AAC annulled the assessment order for the assessment year 1946-47 and set aside the assessment orders for the assessment years 1947-48 and 1948-49 by a consolidated order dated June 29, 1963. The ITO passed fresh assessment orders dated June 12, 1969, for the assessment years 1947-48 and 1948-49 and the addition of Rs. 1,00,000 was deleted for the assessment year 1947-48, while the addition of Rs. 8,275 for the assessment year 1948-49 was retained. As a result of thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er proceedings are also required to be taken under the Act of 1922. Respondent No. 2 held that the orders passed by the ITO pursuant to the order of the AAC could not be said to be under the Act of 1961, but will have to be treated as one under the Act of 1922. The order of respondent No. 2 is under challenge. Mr. Khatri, learned counsel appearing on behalf of the petitioner, submitted that the petitioner is entitled to interest under s. 244 of the Act of 1961. Sub-s. (1) of s. 244 of the Act of 1961 reads as under " 244. (1) Where a refund is due to the assessee in pursuance of an order referred to in section 240 and the Income-tax Officer does not grant the refund within a period of three months from the end of the month in which such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2)(a) of s. 297 reads as under : " 297. (2) (a) Where a return of income has been filed before the commencement of this Act by any person for any assessment year, proceedings for the assessment of that person for that year may be taken and continued as if this Act had not been passed. " Mr. Joshi submits, and in my judgment with considerable merit, that the return of income was filed by the petitioner before the commencement of the Act of 1961, and proceedings for the assessment for the years 1947-48 and 1948-49 can be taken and continued under the Act of 1922 as if the Act of 1961 had not been passed. Mr. Khatri, on the other hand, urged that even though sub-s. (2)(a) of s. 297 of the Act of 1961 permits continuation of the proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt order. The effect of these two decisions is that, where a return of income has been filed before the commencement of the Act of 1961 for any assessment year, the assessment proceedings as well as the entire subsequent proceedings will be governed by the provisions of the Act of 1922 as if that Act has not been repealed. M. Khatri tried to place reliance upon the decision of the Division Bench of the Calcutta High Court in Imperial Chemical Industries Ltd. v. CIT [1979] 116 ITR 516, where it was observed as under (headnote): " Parliament has deliberately used the expression 'may' only in some sub-clauses of s. 297(2) of the I.T. Act, 1961. Due significance and weight must be given to the choice of language by Parliament. In cl. (a) of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled before the commencement of the Act of 1961, was not adverted to by the Supreme Court, as the same was not an issue in the case before the Supreme Court. In my judgment, it is not permissible to bypass the Supreme Court decision on this ground. The ITO is bound to continue the proceedings in accordance with the provisions of the Act of 1922. Mr. Khatri then submits that the ITO served notice under sub-s. (2) of s. 143 of the Act of 1961 and the assessment order dated June 12, 1969, recites that the assessment is completed in accordance with the provisions of sub-s. (3) of s. 143. In my judgment, the mere fact that the ITO quoted a wrong section in the order would not entitle the petitioner to claim that the order was not passed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 1962 issued by the Central Board of Revenue. The Circular was issued in exercise of the powers under s. 119 of the Act of 1961, and Mr. Joshi did not dispute that if there is anything in the Circular, which is in favour of the assessee, then the directions under the Circular are binding on the ITO. Mr. Khatri submits that paragraph 5(a) of the Circular supports the claim of the petitioner. It provides that interest will be payable on the following appellate, etc., refunds : " Where assessment was completed before April 1, 1962, and appeal, etc., order is passed after April 1, 1962. " Mr. Joshi is right in his submission that the direction given under this circular under paragraph 5(a) is in accordance with the provisions of s. 297(2)( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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