1957 (9) TMI 69 - HC - Income Tax

Summary

Issues:
1. Jurisdiction of the Income-tax Officer under section 35 for revising the assessment.
2. Interpretation of section 35 in conjunction with section 34 for re-opening assessments.
3. Application of the four-year limitation period under section 35(1) for issuing a notice of demand.

Jurisdiction of the Income-tax Officer under section 35 for revising the assessment:
The judgment pertains to a petition seeking to quash an order of the Income-tax Officer revising the assessment of a non-resident petitioner for the year 1951-52 under section 35 of the Income-tax Act. The petitioner's income was initially computed without including super-tax and surcharge on super-tax. The court held that the officer had jurisdiction under section 35 to revise the assessment if there was a mistake apparent from the record, which, in this case, was the omission of super-tax and surcharge. The court emphasized that the officer's jurisdiction under section 35 was valid in this scenario.

Interpretation of section 35 in conjunction with section 34 for re-opening assessments:
The petitioner contended that the officer should have used section 34 instead of section 35 to re-open the assessment. However, the court disagreed, stating that the officer correctly exercised jurisdiction under section 35 as there was a mistake apparent from the record. The court highlighted that the question of jurisdiction under section 35 depends on the existence of a clear mistake, which, in this case, justified the officer's actions under section 35.

Application of the four-year limitation period under section 35(1) for issuing a notice of demand:
The petitioner argued that the officer had no jurisdiction to demand tax as the notice of demand was issued after the four-year limitation period prescribed by section 35(1). The court rejected this argument, clarifying that the limitation period in section 35(1) pertained to the making of the rectification order, not the issuance of a notice of demand. The court emphasized that the notice of demand under section 29 was a procedural requirement following the revision under section 35(1) and was not subject to the limitation period. Consequently, the court dismissed the petition and awarded costs to the respondent.

In conclusion, the judgment upholds the jurisdiction of the Income-tax Officer under section 35 to revise assessments based on apparent mistakes, rejects the petitioner's argument regarding the use of section 34, and clarifies that the limitation period under section 35(1) does not apply to the issuance of a notice of demand.