TMI Blog1994 (6) TMI 50X X X X Extracts X X X X X X X X Extracts X X X X ..... is an individual who receives pension from the Government of United Kingdom of Great Britain after retirement from Defence Service. He is getting pension from the Government of Great Britain through State Bank of India, Coimbatore Branch under the Foreign Exchange Regulation Act. After making enquiries, the Department set in motion the assessment proceedings by issuing statutory notice under section 139(2) on 16-12-1972. The assessee is being regularly assessed to tax as an individual resident and ordinarily resident from the assessment year 1972-73 onwards under section 143(1). On the same lines, the impugned assessments for the assessment years 1982-83 to 1985-86 were completed under section 143(1) and the Assessing Officer has raised demand separately as detailed in the accompanying Demand Notices. 3. Coming to know that an agreement for avoidance of double taxation and prevention of fiscal evasion with the Government of Great Britain was signed by the Government of India vide Notification No. GSR 612(E). dated 23-11-1981 and article 19(3) of the said Convention rendered the pension received by the assessee in India is taxable only in the Contracting State and not liable to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h as the case of the assessee squarely falls within the specific clause of section 264(1)(c), the appeals filed by the assessee were maintainable and remedies available to the assessee can be obtained from the Appellate Forum. 8. After due consideration of the rival submissions and the records, I agree that the submission of the learned counsel for the assessee that the appeals filed by the assessee were maintainable under section 246(1)(c). As indicated above, the assessee has been brought into tax net as a result of enquiries made by the assessing authorities and issued statutory notice under section 139(2) as per which regular assessments have been made right from assessment year 1972-73. Therefore, the assessee was under the same impression that he is liable to be taxed on the pension income received from the Government of Great Britain and hence filed the return for these years under consideration, admitting the pension income. As usual, the assessments have been made accepting the income returned though it is obligatory on the part of the Assessing Officer to apply the correct principle of law for taxation. It is for the assessing authority to point out the law and exempt t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee totally denies his liability to be assessed under the IT Act in terms of the Convention signed by the Government of India and the Government of Great Britain in general and article 19(3) in particular. The Supreme Court had an occasion to consider the scope of the relevant section under the IT Act, 1922 in the case of CIT v. Kanpur Coal Syndicate [1964] 53 ITR 225. At page 229 of the Report, the Supreme Court observed as under : " Under section 30 an assessee objecting to the amount of income assessed under section 23 or the amount of tax determined under the said section or denying his liability to be assessed under the Act can prefer an appeal against the order of the Income-tax Officer to the Appellate Assistant Commissioner. It is said that an order made by the Income-tax Officer rejecting the plea of an association of persons that the members thereof shall be assessed individually does not fall under one or other of the three heads mentioned above. What is the substance of the objection of the assessee ? The assessee denies his liability to be assessed under the Act in the circumstances of the case and pleads that the members of association shall be assessed only individu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee who denies his liability of being assessed is entitled to appeal on that ground only after assessment is made. No appeal lies before any assessment is made. 11. Even in the instant case, the assessee has disputed his liability to be assessed before the first appellate authority only after the assessments were made. Courts have held that it is not incumbent or necessary that an assessee should have denied his liability before the Assessing Officer and then only he can prefer an appeal on that ground Rani Anand Kunwar v. CIT [1940] 18 ITR 126 (Oudh) and M.M. Muthuwappa's case.They also held that mere filing of return cannot be said to be tantamount to an admission by the person submitting the return that he is liable to assessment Rani Anand Kunwar's case. The Mysore High Court in the case of Narsepalli Oil Mills v. State of Mysore [1973] 32 STC 599 held that " if an assessee makes a mistake in submitting a return and submits to be assessed on a particular income before the assessing authority, he is not estopped or precluded by law from preferring an appeal and showing to the appellate authority that the income is, in fact, either wholly or partially, not exigible to tax. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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