9911796707
TMI Blog1972 (4) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... cording to law under the Income-tax Act, 1922 ?" The applicant, Shri Narinder Singh Dhingra, is assessed as Hindu undivided family as its karta. The Hindu undivided family is a partner in various partnership concerns and has also interest income from deposits and is also in receipt of dividends from certain shares. Shri Narinder Singh was co-opted as director of Messrs. Olympus Optical Instruments Manufacturing Co. (P.) Ltd., New Delhi, and in that capacity he was paid director's remuneration of Rs. 10,800 besides director's fee of Rs. 600 for attending meetings of the board of directors. On March 8, 1962, the family filed return of income before the Income-tax Officer. A separate return was filed by Shri Narinder Singh in the status of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. By its order dated 20th July, 1966, the Tribunal allowed the preliminary objection taken in the appeal before it, viz., that the assessment was invalid because it was made under the new Act. In paragraph 4 of its order the Tribunal stated as follows: " The orders passed by the authorities below are set aside and the case is restored to the file of the Income-tax Officer. He should proceed from the return stage and make a fresh assessment according to law under the old Act, viz., the Indian Income-tax Act, 1922." It is this part of the order of the Tribunal by which the assessee felt aggrieved and he asked for the question of law mentioned above being referred to this court. It is apparent that, as the return was filed before March 31 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the shareholder. The time limit for such a proceeding will be four years from the last day of the financial year in which the income first became assessable in the hands of the shareholder on June 25, 1956. The time limit will, therefore, be up to March 31, 1961." Following up this, the Income-tax Officer issued a notice under section 34 on October 27, 1956, and completed the reassessment. The question was whether the order made by the Appellate Assistant Commissioner operated so as to remove the bar of limitation prescribed by section 34 by virtue of the second proviso to section 34(3) and the reassessment made pursuant to his order was valid. It was held that the direction to assess the income in this case was not one that could naturall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... then referred us to another decision of the Madras High Court in Naganatha Iyer v. Commissioner of Income-tax, where it was said that a direction cannot be given by the Appellate Assistant Commissioner in the exercise of his powers under section 31 which goes to the extent of conferring jurisdiction on the Income-tax Officer where he is not lawfully seized of jurisdiction. On the basis of these authorities, it was contended that the Income-tax Appellate Tribunal having held that the assessment was invalid because it was made under the Act of 1961, when it should have been made under the Act of 1922, the Tribunal could not restore the case to the file of the Income-tax Officer and direct him to proceed from the return stage and make fresh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly restriction is about the use of the word "thereon" in section 33(4) which confines the jurisdiction of the Tribunal to the subject-matter of the appeal. There can be no doubt that the powers of the Tribunal in hearing appeals are very wide indeed, but the question still remains whether it has the power to confer jurisdiction on the Income-tax Officer to remove the bar of limitation and to proceed on the basis of a return long after the period prescribed by section 34(3) of the Act. Counsel for the revenue contended that the only mistake that the Income-tax Officer had made was that he had used section 143 of the Income-tax Act of 1961, whereas he should have used section 23 of the Income-tax Act of 1922. Merely because wrong sections ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at had happened was that the assessment had been set aside because of the mistake committed in the use of a wrong section of the statute. Unhappily for the department, however, if that was the view, it was open to the department to have asked the Tribunal to refer the question to this court as to whether the assessment made by the Income-tax Officer was invalid because it was made under the new Act. The department, however, did not ask for any such reference. On the other hand the question submitted to this court starts with the premise that the assessment made under section 143(3) of the Act of 1961 was invalid and, therefore, the Tribunal could restore it to the file of the Income-tax Officer and direct him to proceed from the return stag ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
