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TMI Blog1967 (9) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... t Rs. 30,000. He, therefore, issued a notice against the assessee under section 34(1)(a) of the Indian Income-tax Act. At that stage the assessee himself disclosed new figures as to his receipts from the speculation business as also of his payments made in the speculation business. The figures as given at the time of the original assessment and as given by the assessee at the time of the reassessment proceedings under section 34 were as follows : Figures furnished at the Figures furnished at time of the original the time of proceedings assessment under section 34. Rs. Rs. Speculation receipts 3,83,436 4,14,585 Speculation payment made by the assessee 4,49,650 5,35,160 It will thus be noticed that the assessee himself showed at the time of the proceedings under section 34 that his receipts from the speculation business were larger by the sum of Rs. 31,149. At the same time, he claimed that his payments were larger by the sum of Rs. 85,510. He explained this difference in the figures of payments made as furnished at the time of the original assessment and as furnished at the time of the proceedings under section 34 by saying that the difference of Rs. 85,510 was accounted for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at "income, profits or gains chargeable to income-tax have escaped assessment for that year, or have been under-assessed, or assessed at too low a rate, or have been made the subject of excessive relief under the Act, or excessive loss or depreciation allowance has been computed", he "may proceed to assess or reassess such income, profits or gains or recompute the loss or depreciation allowance". What is emphasized is that in conferring the power upon the Income-tax Officer to assess or reassess the income, profits or gains the expression used is de such income, profits or gains", but when conferring the power to recompute the loss or depreciation allowance the word "such" is not used before the word "loss". The effect of this, according to counsel, is that in the case of income, profits or gains chargeable to income-tax which have escaped assessment, the power is limited to assessing or reassessing such income, profits or gains only, that is to say, income, profits or gains which have escaped assessment, but where it comes to recomputing the loss there is no limitation and it would be open to the Income-tax Officer to recompute the entire income so that the assessee would be entit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at recomputation can only take place with a view to garnering in the income escaping assessment under the first clause. It is clear from the provisions of the section itself that it was not intended for the benefit of the assessee but only for the benefit of the revenue. Moreover, we find that where an assessee is affected by such an error as has been pleaded on behalf of the assessee in the present case, a clear power of rectification of mistakes in favour of the assessee is granted by section 35. The mistakes which were pointed out in the present case on behalf of the assessee were, as we have shown above, two. Firstly, that there were mistakes in totalling, and secondly, that there was an amount of loss not declared at the time of the original assessment. If these were indeed mistakes, as is now sought to be made out, the power of rectification would clearly be under section 35. The existence of such a power by contrast negatives the interpretation which the assessee seeks to put upon the provisions of section 35. Looking at the section from any point of view and considering it in the context of the other provisions of the Act, we cannot suppose that when the original section a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, and those two items were under-assessed, and to the extent to which they were under-assessed they have escaped assessment. There is nothing to show that the other item 'other sources'---Interest, which includes interest on mortgages, bank deposits, and so forth, would have been assessed at a lower figure if the Income-tax Officer had had the right figure in respect of the interest on securities and dividends. It seems to me, therefore, that this is a case in which certain items have escaped assessment, although it is true, that another item has been overassessed. But credit cannot be given to the assessee in respect to the latter item." No doubt in that case, the income under another head of charge was claimed to have been over-assessed and in the present case the income under the same head of charge is concerned, but we do not think that in principle that would make any difference so far as the applicability of section 34(1)(a) is concerned. The decision in Madhavjee Domodar's case was followed in S. Inder Singh Gill v. Commissioner of Income-tax by a Division Bench of this court (to which my learned brother was a party). The Division Bench in that case considered the ambit o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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