1986 (3) TMI 120

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..... e, tax deducted at source, etc., it would be found that no interest was chargeable under section 217 as alleged. The assessee also submitted that action under section 263 cannot be taken as the assessment order was passed by the ITO after considering the instructions of the IAC under section 144B of the Act. It was also contended by the assessee that the order of the ITO was not erroneous or prejudicial to the interest of the revenue. It was urged, therefore, that the proceedings under section 263 should be dropped. 3. The Commissioner noted that section 217 has to be read with section 215(5) of the Act and the assessed tax would be the tax determined on the basis of regular assessment as reduced by the tax deducted at source. He found no .....

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..... ns made before the Commissioner have been incorporated in the grounds of appeal mostly. It is also appealed by the assessee that the Commissioner erred in cancelling the whole assessment and in directing the ITO to make fresh assessment and in the circumstances the Commissioner has exceeded his powers conferred by section 263 and in the circumstances, his order requires to be quashed. It is the assessee's submissions that even otherwise, the direction of the Commissioner should confine only to the point contained in the show-cause notice and, therefore, the order of the Commissioner on the facts of the case, cannot be sustained. 6. It is urged by the assessee's learned counsel that the order to charge or not to charge interest under secti .....

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..... 9. In the case of Singho Mica Mining Co. Ltd. the Hon'ble Calcutta High Court held that the order of the ITO failing to charge interest and no reason was mentioned for which it would not be possible to infer that the ITO has considered the matter at all or exercised his discretion. Action under section 263 was upheld. In the case of Premchand Sitanath Roy, the Calcutta High Court has sustained the order under section 263 as the ITO did not charge interest under section 139 on the facts of the case. 10. Thus, after hearing both the sides and after considering the orders of the authorities below and keeping in view the ratio of the different decisions noted above, we are of the opinion that the Commissioner has validly initiated the proc .....

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