TMI Blog2004 (7) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... ceeding, the Commissioner can exercise jurisdiction under section 263 of the Act on other valid grounds. Therefore, the order of the CIT does not suffer from any illegality. The Tribunal was justified in upholding the order of CIT - - - - - Dated:- 30-7-2004 - Judge(s) : R. K. AGARWAL., K. N. OJHA. JUDGMENT The Income-tax Appellate Tribunal, Allahabad, has referred the following question of law under section 256(1) of the Income-tax Act, 1961, hereinafter referred to as "the Act" for the opinion to this court: "Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that despite the inquiries made by the Commissioner of Income-tax beyond the record of assessment, the Commissioner of Income-t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplication before the Commissioner of Income-tax, Allahabad, under section 273A of the Act for waiver of penalty and interest. That application led the Commissioner of Income-tax to hold an inquiry. The Commissioner of Income-tax called for the reports of the Income-tax Officer on the said application. Another comprehensive report was called for by the Commissioner of Income-tax in the same connection from the Income-tax Officer. The Commissioner of Income-tax eventually rejected the application of the assessee under section 273A of the Act on October 15, 1981. However, from the said record of assessment, the Commissioner of Income-tax noticed the following: (i) The assessment was completed by the Income-tax Officer on the very same date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without any application of mind. He submitted that the assessment order had been passed after the applicant had filed the revised return enhancing the value of the sale price of the truck sold during the year in question and also enclosing the copies of the statement of the bank account and other particulars. He further submitted that the proceedings under section 263 of the Act cannot be initiated if the Assessing Officer has failed to initiate penalty proceedings at the time of completion of the assessment. He relied upon a decision of the Delhi High Court in the case of Addl. CIT v. J. K. D'Costa [1982] 133 ITR 7, wherein the Delhi High Court has said that the mere fact that there is some minor omission or mistake in the assessment order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x was well within the jurisdiction to initiate the proceedings under section 263 of the Act. He relied upon a decision of the hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 83 (SC). Having heard learned counsel for the parties, we find that the Income-tax Officer had passed assessment order in the following terms: "Assessed under section 143(3) on a total income of Rs. 55,000 after giving deduction under section 80C on agreed basis. Issue notice of demand and challan. Penalty notices under sections 273(c) and 10(1) of CDS has also been issued." The aforesaid order was passed in the notice of demand issued under section 156 of the Act. From a perusal of the aforesaid order, it cannot be termed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l orders passed without applying the principles of natural justice or without application of mind". In the present case the Commissioner of Income-tax by initiating the proceedings under section 263 of the Act had given reasons as to why the order is erroneous and prejudicial to the interests of the Revenue. Even if it is held that no penalty proceeding have been initiated by the Income-tax Officer in the course of the assessment proceeding, the Commissioner can exercise jurisdiction under section 263 of the Act on other valid grounds. Therefore, the order of the Commissioner of Income-tax does not suffer from any illegality. The Tribunal was justified in upholding the order of the Commissioner of Income-tax. In this view of the foregoi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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