TMI Blog1991 (3) TMI 219X X X X Extracts X X X X X X X X Extracts X X X X ..... nses for road work being capital . . (4,01,333 + 1,22,680) 5,24,013 . . 5,96,017 . Cane farm expenses limited to actual net . . expenditure over income. 2,28,847 . Cane development salary 10,65,076 . . 18,89,940 . Weighted deduction @ 1/5th of the same (18,89,940) Rs. 3,77,9874 Subsequently, invoking the powers vested in him by s. 263 of the Act the CIT called for and examined the assessment records of the assessee. On such an examination he found that the ITO had erroneously allowed the assessee allowance of Rs 3,77,984 under s.35C of the Act. The CIT found that the balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Eimco KCP Ltd (1984) 147 ITR 603 (Mad). He also relied in this connection on the order dt. 26th Nov., 1985 of the Tribunal, Madras Bench in the case of Coromandel Engineering Ltd. in ITA No. 2630(Mad)/1984. 5. On the limitation issue, the assessee's case was that, the impugned assessment order having been passed on 11th Sept., 1984, the order in revision ought to have been passed on or before 10th Sept., 1986 and not later. In this regard, the assessee's case was that the extension of the limitation period brought about by the Taxation Laws (Amendment) Act, 1984 would be effective only from 1st Oct., 1984 and it cannot apply to an assessment completed prior to that date. The CIT rejected these contentions also relying on the ratio of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td vs. ITO (1985) 22 TTJ (Mad) 185: (1986) 17 ITD 305 (Mad) Dwarkadas Co. P. Ltd. vs. ITO (1982) 13 TTJ (Bom) 107 (SB): (1982) 1 ITD 303 (Bom)(SB). In respect of the third proposition, reliance was placed on the Bombay case of Ritz Ltd vs. Union of India (1990) 83 CTR (Bom) 177: (1990) 184 ITR 599 (Bom). 10. Shri Krishnan, next contended that the CIT was not justified in relying on the M.P. Case of Banwarilal. According to him, when there is no direct decision of the jurisdictional High Court on this issue, the Commissioner ought to have followed the decision favourable to the assessed In this regard, he relied on the Bombay case of Subramanian, K., ITO vs. Siemens India Ltd (1983) 36 CTR (Bom) 197: (1985) 156 ITR 11 (Bom). 11. Turn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said decision, the Bombay case of Ritz Ltd. was also considered. He was requested to make his submissions in the light of the said three decisions. 14. In the course of the hearing on 14th Feb., 1991, Shri Krishnan, made the following points: (i) The decision of the Tribunal, Madras Bench in the case of Carborandum Universal Ltd. vs. ITO was not considered in the said three cases. (ii) in the case of CIT vs. East Coast Marine Products Pvt. Ltd (1990) 88 CTR (AP) 156 the Andhra Pradesh High Court had no doubt made certain observations on Expln. (c) to s.263. But, these observations are in the nature of obiter. (iii) The Bombay decision, in the case of Ritz Ltd. is directly applicable to the case before us and, consequently, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT has no jurisdiction to invoke the powers under s. 263 of the Act, 61?" This question was answered by the Andhra Pradesh High Court in favour of the Revenue. It was in that context that the Andhra Pradesh High Court referred to the 1988 Amendment to s. 263. Therefore, the said decision was rightly referred to and relied upon by the Tribunal in the case of Investment Trust of India (P) Ltd. 18. There is yet another matter that is noteworthy. Prior to the introduction of Expln. (c) to s. 263, there was difference of opinion amongst the Courts as to Whether an assessment order completely merged with the order of the first appellate authority. The Bombay High Court has subscribed to the view of total merger. This recent decision in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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