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TMI Blog1969 (10) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... lour mill as income from other sources and not as income from business. The assessee (respondent) filed an appeal before the Appellate Assistant Commissioner of Income-tax, who accepted the appeal by order dated July 24, 1959, and held that the income from the lease of Jawala Flour Mills, Amritsar, was liable to be assessed under the head " business ". The Commissioner of Income-tax directed the Income-tax Officer on October 17, 1959, to file an appeal against the order of the Appellate Assistant Commissioner of Income-tax before the Tribunal. The appeal was accordingly filed but was withdrawn later on. On March 21, 1960, the Income-tax Officer issued a notice under section 34(1)(b) of the Indian Income-tax Act, 1922 (hereinafter called " the Act "), to the respondent for the assessment year 1955-56 and made a reassessment order on March 20, 1961. In this order, he assessed the income from the lease of Jawala Flour Mills, Amritsar, under the head " other sources " instead of the head " business " with the result that the brought forward business loss which had been set off in the original assessment dated November 21, 1965, was not set off against the income from business in the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief of the Income-tax Officer who initiated the proceedings under section 34(1)(b) that income from lease money should be treated as income from other sources is based on no information whatsoever, but is merely a change of opinion by the successor Income-tax Officer on absolutely the same set of facts on which his predecessor had come to a finding that the income was from business. It would thus be seen that the proceedings under section 34(1)(b) have been instituted merely because of a change of opinion. Since there was no information in the possession of the Income-tax Officer in consequence of which he had reason to believe that the assessee had been granted excessive relief, the Appellate Assistant Commissioner was justified in holding that the proceedings under section 34(1)(b) were bad in law. His order is, in the circumstances, affirmed. " Against that order, the Commissioner of Income-tax made an application before the Income-tax Appellate Tribunal under section 66(1) of the Act for drawing up the statement of the case and to refer to this court the following question of law : " Whether, on the facts and in the circumstances of the case, notice under section 34(1)(b) was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave that information to the Income-tax Officer or whether he informed himself was immaterial. It was also held that the availability of the powers to rectify the mistake under section 35 of the Act did not bar recourse to the jurisdiction of issuing notice under section 34. In Commissioner of Wealth-tax v. Imperial Tobacco Co. of India Ltd. their Lordships of the Supreme Court, while considering the scope of section 17(b) of the Wealth-tax Act, referred to the decisions under 34(1)(b) of the Act, as the two sections were in pari mataria. Having referred to some judgments of the various High Courts, their Lordships observed as under: " It does appear that some High Courts at any rate are taking the view that a change of opinion by the Income-tax Officer in certain circumstances will be sufficient for the purpose of section 34(1)(b) and will justify the issue of a notice thereunder. It may be added that after the decision of this court in Maharaj Kumar Kamal Singh's case it is now settled that 'information' in section 33(1)(b) included information as to the true and correct state of the law, and so would cover information as to relevant judicial decisions, and that such information ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the opinion expressed by the Central Board of Revenue regarding the correct valuation of securities for purposes of estate duty, expressed in an appeal preferred by the accountable person, is " information " within the meaning of section 59 of the Estate Duty Act, 1953, as amended by the Estate Duty (Amendment) Act of 1958, on the basis of which the Controller can entertain a reasonable belief that property assessed to estate duty has been under-valued. At this stage we are only concerned with the question whether a question of law arises out of the order of the Income-tax Appellate Tribunal and are not concerned with answering the same. It was so held by their Lordships of the Supreme Court in Commissioner of Income-tax v. Jai Parkash Om Parkash Company Ltd. In that case the Tribunal had declined to state a case to the High Court whereupon the Commissioner moved the High Court under section 66(2) of the Act for an order directing the Tribunal to state a case and refer the question whether the sum of Rs. 94,253,00 or any part of it accrued or arose or could be deemed to have accrued or arisen to the assessee during the accounting year. The High Court refused to direct the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so, it would be a clear attempt to circumvent the said order, which had become final. We are not concerned in this appeal with a case where the Income-tax Officer got new information which he did not have at the time when the Tribunal made the order. The finding of the Tribunal is, therefore, binding on the Income-tax Officer and he cannot, in the circumstances of the case, reopen the assessment and initiate proceedings over again. If that was not in legal position, we would be placing an unrestricted power of review in the hands of an Income-tax Officer to go behind the findings given by a hierarchy of tribunals and even those of the High Court and the Supreme Court with his changing moods. " On the basis of this judgment, it has been submitted by the learned counsel for the respondent that in all the previous years and subsequent years the income from the lease of Jawala Flour Mills was considered by the department as income from business and the appeal filed before the Income-tax Appellate Tribunal against the order of the Appellate Assistant Commissioner of Income-tax for the year 1957-58 was withdrawn with the result that it has been accepted throughout by the department that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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