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TMI Blog1985 (3) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income-tax Act, 1961 ('the Act'). The assessment year involved is 1978-79. The ITO originally completed the assessment on 5-5-1981, in which weighted deduction under section 35B of the Act had been allowed on the commission paid to H.M.T. Ltd. Subsequently, the ITO had reopened the assessment under section 147(b) of the Act on some other ground and also completed the reassessment without an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order is not vacated. He set aside the order of the ITO and directed him to disallow weighted deduction under section 35B. The assessee is in appeal. 2. It cannot be disputed that when the order sought to be revised is the order of reassessment, section 263 cannot be applied. The provisions of section 263(2), as they stood at the relevant time, are as follows : "No order shall be made under sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he entire assessment is open before the ITO and he can make additions which had not been made in the original assessment although the assessment had been reopened on the basis that certain items of income had escaped assessment. The reassessment gives the power to the ITO to rope in every item of escaped assessment. Under these circumstances, it would be more proper to hold that the original asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed, while actually the mistake had occurred in the original assessment. The Hon'ble High Court held that the original order did not exist as an independent order but merged with the reassessment order. It held that the time limit for rectification, accordingly, had to be counted from the date on which the reassessment order was passed. Respectfully following the above decision, we hold that there ..... X X X X Extracts X X X X X X X X Extracts X X X X
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