1983 (9) TMI 102 - AT - Income Tax

Summary

Issues:
1. Condonation of delay in filing appeal.
2. Disallowance of depreciation by the assessing officer.
3. Jurisdiction of the Commissioner under section 263 to interfere in the assessment order.

Detailed Analysis:
1. The issue of condonation of delay in filing the appeal arose as the appeal was filed six days late. The assessee provided reasons for the delay, citing the illness of the principal officer who was handling taxation matters. The officer was confined to bed from 9-2-1981 to 28-2-1981, as supported by a medical certificate. The appeal fee was paid on 3-3-1981, immediately after the officer's recovery. The Tribunal, considering these facts, condoned the delay and proceeded to hear the appeal.

2. The assessing officer disallowed depreciation of Rs. 47,712 on service lines in the draft assessment order. The matter was referred to the Income-tax Appellate Tribunal (ITAT) under section 144B of the Income-tax Act, 1961. The ITAT confirmed the disallowance. However, the Commissioner initiated proceedings under section 263, deeming the assessment prejudicial to revenue. The Commissioner held that the assessee, after the takeover of the electricity business, was not entitled to any depreciation. The Commissioner directed the modifying of the assessment order accordingly.

3. The jurisdiction of the Commissioner under section 263 to interfere in the assessment order was contested. The assessee argued that since the matter of depreciation was referred to the Income-tax Appellate Tribunal under section 144B, the Commissioner had no authority to interfere. However, the departmental representative contended that the Commissioner's jurisdiction was not excluded concerning the depreciation on other items not subject to the reference to the Income-tax Appellate Tribunal. The Tribunal agreed with the departmental representative, holding that the Commissioner had the authority to interfere in the allowance of depreciation not referred to the Income-tax Appellate Tribunal. The Tribunal confirmed the Commissioner's order, dismissing the appeal.