TMI Blog1992 (7) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Act, 1961 ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in directing the Income-tax Officer to redo the assessment after having found that the order recorded in the order sheet on April 11, 1967, was not in accordance with the law and contrary to the principles of natural justice ?" Shortly stated, the facts are that the assessee is a Hindu undivided family. The assessment year is 1962-63, relating to the Dewali year ending on November 3, 1961. The assessee was served, within the statutory period of time available for completion of assessment for the year under reference, with a notice of demand dated April 11, 1967, for the said year. The assessee, however, did not receive a copy of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated May 30, 1974, states that he had given sufficient opportunity to the authorities concerned to produce before him the original order which was supposed to have been scribbled or written out and a copy of which was typed on the form printed on November 16, 1967. Since no elucidation on this point was forthcoming, the Appellate Assistant Commissioner inferred that the order under section 143(3) of the Act was passed only after November 16, 1967. He, therefore, concluded that the order was made after the period of limitation provided under section 153 of the Act. Accordingly, he annulled the order of the Income-tax Officer made under section 143(3) of the Act, on the basis of which the notice of demand under section 156 of the Act dated A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the orders for the subsequent years. He, however, stated that the demand notice and challan for the assessment year under reference were received in April, 1967. Further, he submitted that the order sheet entry was not a speaking order and the detailed order, a copy of which was given to the assessee, was different from the order sheet entry dated April 11, 1967. In this connection, he further submitted that the Income-tax Officer was not empowered to amend the order without following the procedure prescribed in section 154 of the Act. He, therefore, urged that the latter order which was a detailed order was null and void as no notice for amendment of the order made by the order sheet entry was given to the assessee. Finally, he submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever, we have to see that the order must be a speaking order, an order which gives reasons for the decisions arrived at by the Income tax Officer, affecting the rights and interests of the assessee. The Income tax Officer has to act in a judicial manner, proceed with a judicial spirit and come to judicial conclusions. In this case, however, the impugned order dated April 11, 1967, does not rest on these pillars. The order which is supplied subsequently to the assessee on May 4, 1968, is different. It is non est in our opinion because the order dated April 11, 1967, on the order sheet could not have been amended, as rightly contended by learned counsel of the assessee, without following the procedure prescribed under section 154. Our conclus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs" or "filed", it has to be construed as an order disposing of the proceedings of assessment. The facts in this case are, however, slightly different. There, the entry in the order sheet was not made inflicting any tax liability but merely closing the proceeding as infructuous. None the less, it lays down a procedural principle that an entry in the order sheet could as well be an order of assessment. May be, the order is not a speaking one and, in that way, violates the principles of natural justice. Every authority functioning in a quasi-judicial capacity must pass his order by showing reasons which support or afford the basis for such order. It is an elementary principle of natural justice that justice should not only be done but should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . ITO [1960] 40 ITR 298 (SC). In that case, the Income-tax Officer issued a notice asking the assessee to show cause why penalty should not be imposed. The persons proceeded against could not say that the Income-tax Officer was devoid of jurisdiction to initiate the proceedings and to issue such notice. But the mistake the Income-tax Officer had committed was that he levied the penalty before he had heard the party. The Appellate Assistant Commissioner set aside the order directing the Income-tax Officer to refund any sum that might have been recovered from the assessee meanwhile. But the officer did not give up the matter. He issued a fresh notice to enable the assessee to present his case and to have an opportunity of being heard. The ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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