1998 (12) TMI 70

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..... petitioner's business and residential premises on March 5, 1985. The third respondent completed the assessment for the year 1984-85 under section 143(3) of the Act on March 31, 1986, on a total income of Rs. 17,32,260 on making an addition of Rs. 50,000 being unexplained cash credit. The third respondent served exhibit P-1 assessment order and demand notice dated March 31, 1986, on the petitioner. On appeal before the Commissioner of Income-tax (Appeals), the addition of Rs. 50,000 was confirmed as per exhibit P-2 order. The petitioner then preferred a second appeal before the Income-tax Appellate Tribunal which as per exhibit P-3 order dated July 6, 1988, set aside the addition of Rs. 50,000 with a direction to the Assessing Officer to r .....

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..... ibunal set aside the additional amount of Rs. 50,000 with a direction to the Assessing Officer to re-examine the genuineness of the cash credit and so interest is leviable only from the date of exhibit P-5, i.e., April 24, 1989, the date on which order under section 154 of the Act was passed. It is her further case that exhibit P-1 assessment order was set aside by the Income-tax Appellate Tribunal and so interest should not have been demanded from March 31, 1986. According to her, the Assessing Officer overlooked the fact that exhibit P-1 assessment order was set aside by the Income-tax Appellate Tribunal and the only assessment which will govern the case is exhibit P-5. Counsel for the petitioner contended that the Income-tax Act does no .....

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..... ent order was wiped out by the order of the Tribunal. Exhibit P-5 order was passed giving effect to the order of the Income-tax Appellate Tribunal. It is seen from exhibit P-3 order that the original assessment order and demand have not been wiped out or cancelled by virtue of the said order. The assessment order was not even set aside, it was set aside only on the specific point regarding the addition of Rs. 50,000. Therefore, it is clear that there is only a partial setting aside of the assessment order. In the decision reported in New Woodlands v. CIT [1982] 138 ITR 795 (Ker), it is held that the notice of demand remains valid and effective to the extent that the tax is finally determined to be due and payable by the assessee, and in ca .....

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