1957 (10) TMI 5 - SUPREME COURT

Whether it is open to an Appellate Assistant Commissioner on appeal to reject the assessee's books of account, which have been accepted by the Income-tax Officer ?

Whether it is open to an Appellate Assistant Commissioner appeal to invoke the provisions of rule 33 of the Indian Income-tax on Rules for the purpose of computing the income of a non-resident, the Income-tax Officer not having done so ?

Held that:- While we agree that, in the first instance, the Income-tax Officer as the first assessing officer has to form an opinion about the applicability of the proviso to section 13, we do not agree that it is not open to any other authority, which is lawfully in seizin of the order of assessment of which the method of accounting under section 13 is only a part, to come to a different conclusion with regard to the applicability of the proviso. The present is not a case where the Appellate Assistant Commissioner has travelled outside the ambit of his jurisdiction under section 31 of the Act. For the reasons given above, we would answer question No. 1 in the affirmative.

As to question No. 2, only a few words are necessary. A similar expression occurs in the rule : "In any case in which the Income-tax Officer is of opinion etc." For the same reasons which we have given with regard to question No. 1, the answer to question No. 2 is also in the affirmative. Appeal allowed. The judgment and order of the High Court of Bombay dated 4th March, 1953, is set aside and the two questions referred to the said High Court are answered in favour of the Revenue