TMI Blog1980 (1) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... s Bank Ltd. v. ITO [1978] 115 ITR 799], in so far as it directs the ITO to make a fresh assessment in respect of the appellant. The appellant is a banking company incorporated in the United Kingdom with its registered office at London. It carries on banking business in India, and is assessed under the I.T. Act, 1961. The appellant filed a return of its income for the assessment year 1972-73. During the assessment proceeding, the ITO issued a notice under s. 142(1) of the I.T. Act requiring the appellant to produce certain account books and documents. The appellant applied against the notice to the High Court at Calcutta under art. 226 of the Constitution. A learned single judge of the High Court did not accept the wide construction whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er two years from the end of that assessment year. The end of the assessment year is March 31, 1975. However, the appellant filed the writ petition on March 17, 1975, fourteen days before the end of the period for making the assessment order. On the same date March 17, 1975, the learned single judge granted an interim injunction restraining the ITO from proceeding with the assessment, and on March 25, 1975, the injunction was made operative for the pendency of the writ petition. The writ petition was disposed of by the learned single judge by his judgment dated August 31, 1976. It is apparent that the assessment proceedings remained stayed throughout the period from March 17, 1975, to August 31, 1976, by virtue of the orders of the court. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entire period from March l975, to March 31, 1977, by successive orders of the court. If regard be had to cl. (ii) of Expln. 1 to s. 153, which provides that in computing the period of limitation for the purposes of s. 153, the period during which the assessment is stayed by an order or injunction of any court shall be excluded, it is abundantly clear that the assessment order dated March 31, 1977, is not barred by limitation. In computing the period for making the assessment, the ITO would be entitled to exclude the entire period from March 17, 1975, on which date there were fourteen days still left within the normal operation of the rule of limitation. The assessment order was made on the very first day after the period of stay expired ; i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adjudication by the High Court establishes a complete want of jurisdiction in the inferior court or tribunal to entertain or to take the proceeding at all. In that event, on the quashing of the proceeding by the High Court, there is no revival at all. But although in the former kind of case the High Court, after quashing the offending order, does not substitute its own order, it has power none the less to pass such further orders as the justice of the case requires. When passing such orders the High Court draws on its inherent power to make all such orders as are necessary for doing complete justice between the parties. The interests of justice require that any undeserved or unfair advantage gained by a party invoking the jurisdiction of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apse at best and one that could be readily corrected by serving an appropriate notice. It was not a defect affecting the fundamental jurisdiction of the ITO to make the assessment. In our opinion, the High Court was plainly right in making the direction which it did. The observations of this court in Director of Inspection of Income-tax (Investigation), New Delhi v. Pooran Mal Sons [1974] 96 ITR 390 at 395, are relevant. It said: " The court in exercising its powers under article 226 has to mould the remedy to suit the facts of a case. If in a particular case a court takes the view that the Income-tax Officer, while passing an order under section 132(5), did not give an adequate opportunity to the party concerned it should not be left ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... propriate, while disposing of the writ petition, to issue a direction to the ITO to complete the assessment which, but for the direction of the High Court, would have been barred by limitation. Our attention has been drawn to a recent decision of this court in Rajinder Nath v. CIT (Civil Appeals Nos. 1864-69/72 decided on August 13, 1979, by a Bench of this court of which one of us was a member) [1979] 120 ITR 14. In that case, the court considered the provisions of s. 153(3)(ii) of the I.T. Act and laid down that the word " direction " in that sub-section refers to a direction necessary for the disposal of the case and which the court has power to make while deciding the case. In the view taken by us that the order made by the High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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