TMI Blog1979 (9) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Companies (Profits) Surtax Act, 1964, were not valid and in holding that the Appellate Assistant Commissioner was justified in annulling the reassessment order made by the Income-tax Officer ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the mere noting of the Income-tax Officer on the letter dated December 3, 1970, stating that the proceedings were already dropped could not be considered as an order to terminate the proceedings and further holding that the reassessment proceedings were not valid ? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the Income-tax Officer could not invoke rule 4 of the Seco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mounts not liable to be included in their total income as computed under the said Act and that, therefore, r. 4 of the Second Schedule to the Companies (Profits) Surtax Act, 1964, was applicable and the capital computation had to be reduced accordingly. The respondents filed an appeal against the said order. One of the grounds taken in the appeal by the respondents was that the ITO had no jurisdiction to reopen the assessment inasmuch as the assessment proceedings, pursuant to the returns filed by the respondents, had not been concluded and were pending. The respondents further objected to the disallowance of the said deductions. Both these objections were allowed by the AAC. There was another contention raised by the respondents with respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Estate of late A. M. K. M. Karuppan Chettiar v. CIT [1969] 72 ITR 403 (SC), held that a notice under s. 34 of the Indian I.T. Act, 1922, could not be issued unless the returns which had been filed were disposed of. The Supreme Court further held that that principle applied to the case before it as the material facts were not different. Mr. Joshi, learned counsel for the petitioner, has, however, referred us to two decisions of the Supreme Court and a decision of the Madras High Court in which it was held that the assessment proceedings in question were concluded by certain notings made by the ITO. In our opinion, none of those cases have any relevance to the facts before us. These notings are, as will be seen presently, different f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in response to notice under section 34(1)(a) (of the Indian Income-tax Act, 1922). The income should be taken in the assessment of the military contract income for which there is another file. The case is, therefore, filed." It is thus clear that in each of the Supreme Court cases relied upon by Mr. Joshi the order on the noting operated in praesenti. Here in the case before us the case is not closed nor the proceedings dropped by this noting. This noting refers to a fact which has already taken place earlier, namely, the dropping of proceedings. There is no order or noting at all to substantiate this statement of the ITO in the noting in question. It is somewhat surprising that had in fact the proceedings been closed by an order or noti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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