TMI Blog1976 (9) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... an Income-tax Act, 1922 (hereinafter referred to as the Act). Subsequent to the passing of the said orders of assessment the Income-tax Officer passed four orders in respect of the two assessment years against the two companies under section 23A of the Act on January 21, 1957, asking the companies to pay certain amounts of additional super-tax on the undistributed profit of the concerned years. In November, 1959, the Income-tax Officer issued a notice under section 35(1) of the Act for rectification of the mistakes committed in the previous orders passed under section 23A on January 21, 1957. The assessee-companies in response to the notices objected to the proposed rectification by the Income-tax Officer, inter alia, on the ground that he had no power to rectify any mistake in an order under section 23A of the Act. The Income-tax Officer overruled the objection raised by the companies, rectified the mistakes in his previous orders and increased the amounts of additional super-tax payable by the companies in relation to the two assessment years. The companies' revision applications filed before the Commissioner of Income-tax, U. P., were dismissed. Thereupon, four writ applications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng; in the context it can comprehend the whole procedure for ascertaining and imposing liability on the taxpayer. It is to be noticed that the marginal note of section 23 is "assessment" and sub-section (3) says "the Income-tax Officer...... shall, by an order in writing, assess the total income of the assessee" and then adds "determine the sum payable by him on the basis of such assessment ". Literally speaking, therefore, the assessment is of the total income of the assessee and then in the same order the sum payable by the assessee is determined which would include income-tax, surcharge, super-tax, etc. Under section 24 of the Act, loss is computed and is allowed to be set off against the income of the same year or carried forward to the next year. If one were to go upon the use of the literal words, then section 24 is for computation of the loss. Yet it is a step in the assessment proceeding and will form part of the order of assessment itself. Section 23A as the marginal note indicates is the "power to assess companies to super-tax on undistributed income in certain cases". The relevant words of sub-section (1) of section 23A are the following: " Where the Income-tax Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23 and an order made by the Income-tax Officer under sub-section (1) of section 23A. It is, therefore, plain that the Commissioner in revision, the Appellate Assistant Commissioner and the Tribunal in appeal can rectify a mistake in the record of the revision or the appeal, as the case may be, taken from the order of assessment under section 23, the order computing loss under section 24, or an order made under section 23A by the Income-tax Officer. Viewed in that light it follows as a matter of construction that the Income-tax Officer can rectify any mistake apparent from the record of assessment which expression is wide enough not only to cover an order of assessment made under section 23 but also an order computing loss under section 24 and an order made under section 23A directing the assessee company to pay additional super-tax. It is neither advisable nor necessary in these appeals to give a complete list of the types of orders apparent mistakes in which can be rectified by the Income-tax Officer under section 35(1) of the Act. Obviously the first proviso to sub-section (1) of section 35 and sub-section (3) lends support to the view that rectification of apparent mistakes in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pressed during the course of hearing. We need not say anything about that as we constitute a Bench of equal strength. But we are clear and definite in our mind that the ratio of Parikh's case is neither applicable nor should be extended to cover the expression "assessment order" occurring in section 35(1) of the Act. In the context the said expression would include an order made under section 23A also, as such an order undoubtedly forms part of the record of assessment. Mr. Gupte, learned counsel for the respondents, in his usual fairness conceded, and rightly, that the power of rectification of mistake conferred on the Income-tax Officer under section 35(1) of the Act cannot be confined within the very narrow limit of an order of assessment made under section 23 only. Counsel submitted that it does embrace some other kinds of order relating to assessment. Having conceded so far, Mr. Gupte endeavoured in vain to take an order made under section 23A of the Act outside the purview of the power of the Income-tax Officer for rectification of mistakes. In Sankappa's case, as we have said above, the same Bench which decided Parikh's case, after stating on the basis of certain earlier ..... X X X X Extracts X X X X X X X X Extracts X X X X
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