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TMI Blog1982 (10) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... 65-66 the Commissioner of Income-tax by his order dated August 23, 1968, passed under s. 264 of the Act allowed deduction of Rs. 4,800, being income-tax fees paid to M/s. P. L. Tandon Co. Thereafter, these two assessments were rectified on April 30, 1970, and 17th October, 1968. On 30th December, l970, the assessee made an application to the ITO under s. 154 claiming relief under s. 80-I on the ground that the assessee manufactured sugar machinery which comes under the head " Priority industry ". The ITO rejected the claim on the ground that the applications were barred by limitation provided under sub-s. (7) of s. 154. The AAC rejected the appeals of the assessee on the reasoning that the mistake was committed in the original assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances of the case, the assessee's applications under section 154 of the Act for the assessment year 1964-65 and 1965-66 were in time ? " As noted earlier, the original assessment for the assessment year 1964-65 was made on March 29, 1965. Thereafter, proceeding for reassessment was initiated and the order of reassessment was passed on December 3, 1968. The assessment was rectified on April 30, 1970. The application for seeking the relief under s. 80-I was made on December 30, 1970. Even if the order dated April 30, 1970, is ignored, the effect of the order of reassessment was that the earlier assessment was wiped out. The effect of reassessment proceedings came up for consideration before the Supreme Court in V. Jaganmohan Rao v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us that once the reassessment proceedings are started the earlier order ceases to exist and the ITO starts the assessment proceedings afresh. For the Revenue, reliance was placed on the decision of this court in Sir Shadi Lal and Sons v. CIT [1973] 92 ITR 453. In that case it was held that on reassessment the entire assessment is not opened. A claim for expenditure which has been disallowed during the original assessment cannot be re-agitated on the assessment being re-opened for bringing to tax income which has escaped assessment. The controversy on reassessment is confined to matters which are relevant in respect of the income which had not been brought to tax during the course of the original assessment. The controversy was confined to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court under arts. 226 and 227 of the Constitution. The principle of merger of orders of inferior courts would not become affected or inapplicable by making any distinction between a petition for revision and an appeal. It was further observed that the revisional jurisdiction is a part of the general appellate jurisdiction of the High Court as a superior court. It is only one of the modes of exercising power conferred by the statute ; basically and fundamentally it is the appellate jurisdiction of the High Court which is being invoked and exercised in a wider and larger sense. These observations were made while dealing with the nature of the revisional power of the High Court under s. 115, CPC, and the question of maintainability of a peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1967 SC): " But the doctrine of merger is not a doctrine of rigid and universal application and it cannot be said that wherever there are two orders, one by the inferior Tribunal and the other by a superior Tribunal, passed in an appeal or revision, there is a fusion or merger of the two orders irrespective of the subject-matter of the appellate or revisional order and the scope of the appeal or revision contemplated by the particular statute. In our opinion, the application of the doctrine depends on the nature of the appellate or revisional order in each case and the scope of the statutory provisions conferring the appellate or revisional jurisdiction. " In the present case the order of the Commissioner dated August 23, 1968, was con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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