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TMI Blog1985 (9) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... 15 under section 172(4). 2. Subsequently, the agent of the assessee sent a letter dated 14-10-1977 to the ITO. This letter was received by the ITO on 18-10-1977. In that letter the agent of the assessee stated that 'claim application' dated 9-10-1977 received from the assessee claiming refund under section 172(7) was being forwarded with the said letter to the ITO. It was further mentioned therein that other connected documents would be forwarded in due course. 3. The 'claim application' mentioned in the said letter was a 'claim for refund of tax' in Form No. 30 under rule 41 of the Income-tax Rules, 1962 ('the Rules'). It was mentioned in this 'claim for refund of tax' that the total income of the assessee for the accounting year ending on 31-12-1975 relevant for the assessment year 1976-77 was Rs. 1,10,970 and that total income-tax and supertax chargeable on that income was Rs. 40,728 and that total income-tax and supertax paid under section 199 of the Act was Rs. 95,922. There was request for refund of Rs. 55,140. 4. On 3-12-1977, the assessee through its agent sent letter dated 3-12-1977 to the ITO in which it was stated that in the earlier assessment order under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (7) of section 172, and as such, it was barred by time. He, therefore, directed that the return submitted by the assessee be filed. The appeal filed by the assessee against that order was dismissed by the Commissioner (Appeals) on two grounds. The first ground was that no appeal was maintainable against an order under section 172(7). The other ground was that no assessment under section 172(7) could be made because of the fact that the return was filed after the expiry of the relevant assessment year and as such, no relief regarding refund could be granted to the assessee. He observed that it was open to the assessee to explore administrative remedies. The assessee has now come in further appeal before us. 7. The first point that requires decision is whether the order of the ITO refusing to entertain the claim for refund and refusing to make regular assessment was appealable. Elaborate arguments were made before us by the parties and several decisions were cited. We do not consider it necessary to record a finding on the point whether the order of the ITO in this case was appealable. We shall assume, for the purposes of this appeal, that said order was appealable. Even then, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first part of the claim is to the effect that income has been wrongly assessed in the summary assessment at Rs. 1,29,615 in fact it should have been assessed at Rs. 1,10,972. The tax payable on regular assessment according to the assessee on the latter figure was Rs. 81,562.95 as against Rs. 95,267 assessed by the ITO in summary assessment. Hence, the excess tax paid on summary assessment should be refunded. It is obvious that a claim for refund of this nature can be entertained only if the assessee requires the ITO under section 172(7) to determine his total income in accordance with the other provisions of the Act. For that purpose the assessee has to file return as required in section 172(7). However, there is time limit for making the said claim and that time limit is date of expiry of the assessment year. If no claim envisaged under sub-section (7) of section 172 is made before the expiry of the relevant assessment year, the summary assessment made earlier under sub-section (4) becomes final and the remedy to claim refund of the above nature is barred. 10. The second part of the claim is that the assessee is entitled to reduction of 50 per cent in the assessed tax. This cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... determined on total income on regular assessment in the above manner that a claim for reduction of 50 per cent in tax charged could be made under clause (1) of article VI. This claim is entertainable only when adjustment as contemplated in sub-section (7) of section 172 is made. As already stated remedy under sub-section (7) of section 172 is barred in the present case because of expiry of time limit for availing thereof. Hence, the second part of the claim also could not have been entertained in the present case. 12. The learned counsel for the assessee drew our attention to section 44B of the Act, which was inserted in the Act with effect from 1-4-1976 by the Finance Act, 1975. This section in substance provides that a non-resident engaged in the business of operation of ships is not entitled to have his income from the business computed under sections 28 to 43A of the Act but an amount equal to 71/2 per cent of his gross receipts is deemed be his profit taxable under the Act. The gross receipts covered by this section are the fare or freight paid in or outside India on account of carriage of shipment at any Indian port and also fare and freight received in India on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In Form No. 30 itself which is prescribed under rule 41, it is specifically mentioned that the said form should be accompanied by the return of income in the prescribed form unless the claimant had already made such return. The return referred to is obviously return on which regular assessment could be made. Such a return in the present case could have only been the return filed under sub-section (7) of section 172 in view of provisions of sub-section (1) thereof already referred to and since the right to file such return was barred by time, claim under the said provisions could not be entertained. Besides, as the recitals in that form indicate, the refund could be claimed under rule 41 when the total income-tax chargeable is less than the total income-tax paid under section 199. In the present case no income-tax has been paid under section 199. The income-tax paid is under section 172. In section 199 income-tax paid under various sections is mentioned but section 172 is not one of them. This is an additional reason for holding that claim under rule 41, read with section 237, was not entertainable. Besides, as already stated, in view of the express provision in sub-section (1), rea ..... 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