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TMI Blog1987 (5) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee that the same belonged to his married daughter Veena Gupta. However it was found that no satisfactory evidence regarding the source of acquisition of the said jewellery was filed before the ITO either by the assessee or Veena Gupta. Therefore, according to the CIT, the value of this jewellery was assessable in the hands of the assessee u/s 69A. The order of the ITO in not making the addition was, therefore, erroneous insofar as it was prejudicial to the interests of the revenue. He, therefore, initiated proceedings u/s 263 and asked the assessee to show cause as to why the order should not be revised. Ultimately, he was of the opinion that there was no documentary evidence regarding acquisition of jewellery. Further the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tinct matters. As against this, the departmental representative relied upon a Full Bench decision of the Madhya Pradesh High Court in the case of CIT v. R.S. Banwarilal [1983] 140 ITR 3. It has been held therein that the doctrine of merger applies to income-tax proceedings but the extent of its application depends on the scope and subject-matter of the appeal and the decision rendered by the appellate authority. The order merges only to the extent to which it was considered and decided by the AAC but on matters which were not covered by the appellate order, the order of the ITO survives and the CIT has the jurisdiction to revise the same. The decision of the Allahabad High Court in the case of J.K. Synthetics Ltd., which is the basic author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... presentative is a Full Bench decision of the M.P. High Court, wherein nearly all the relevant authorities on the subject have been considered. In the absence of any larger Bench decision to the contrary and any decision of the Punjab and Haryana High Court, a Full Bench decision ought to be given preference over the Division Bench decisions. The only authority of the Punjab and Haryana High Court cited at the Bar was New Diwan Oil Mills' case ; though it does not directly deal with the issue, whatever can be gathered from it, it goes to support the case of the revenue. 4. The other point argued was that the enquiry in question had already been conducted by the ITO in proceedings u/s 132(5). A copy of the order of the ITO u/s 132(5) was pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order passed by way of interim measure and it is liable to be scrutinised afresh at the time of final asstt. All that had been directly decided in the order was that the jewellery did not belong to Veena Gupta and she had not acquired it from her in laws. According to that order, jewellery belonged to the assessee. In what year it was liable to be assessed was probably not considered in that order, because that question would arise only when the price of the jewellery was sought to be added in the hands of the assessee. So far as assessment of Veena Gupta is concerned, any observation in that case would not be binding on the assessee. Accordingly, the same could not benefit the assessee. At present, the CIT has only observed that the ITO s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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