TMI Blog1973 (5) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Income-tax Act, 1961, but in the assessment order stated that the assessment had been made under section 23(3), which was the relevant provision of the Act of 1922. The assessment order shows that the income was computed at Rs. 30,801. The assessee appealed to the Appellate Assistant Commissioner partly on the ground that the assessable income had been increased and partly on the ground that the assessment could not be made under the Act of 1922. The Appellate Assistant Commissioner held that the assessment should have been made under the Act of 1961 in view of section 297(2)(b) thereof. He held that the mention of section 23(3) in the assessment order might be an oversight, but the notice of demand had also been issued under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he period for making a valid assessment could not be extended by the Appellate Assistant Commissioner. The Tribunal relied on the decision of the Supreme Court in S. C. Prashar v. Vasantsen Dwarkadas [1963] 49 ITR 1 (SC). The direction of the Appellate Assistant Commissioner was set aside and the appeal allowed. The Commissioner of Income-tax sought a reference to this court, which had led to the following question being stated for our opinion: "Whether, on the facts and in the circumstances of the case, the order of the Appellate Assistant Commissioner directing the Income-tax Officer to make the assessment tinder the provisions of the Income-tax Act, 1961, was incompetent ?" It is apparent from the facts set out above that the basis o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly void in the eyes of law, then it follows that the Appellate Assistant Commissioner could not make a remand. There is some force in this contention. Therefore, the primary question for consideration is whether we have power to disturb the Tribunal's finding that the Income-tax Officer acted wholly without jurisdiction. For ascertaining how the Tribunal dealt with the appeal before it, it is necessary to refer to its appellate order, which is annexed to the statement of the case and forms part of it. The Tribunal held that the Income-tax Officer dealt with the case under the belief that he was acting under the Indian Income-tax Act, 1922. It then proceeded to hold that the assessment order was a nullity and, therefore, four years had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1922, which related to the assessment year 1946-47. The said order had transferred the assessee's case from the Income-tax Officer, Patiala, to the officer at Ambala. In consequence of this transfer, the officer at Ambala issued a notice under section 34 of the Patiala Income-tax Act of Samvat 2001. His jurisdiction was challenged on the ground that the transfer was invalid because in the assessment year 1946-47, the Income-tax Act which applied was the Patiala Income-tax Act and not the Indian Income-tax Act. The Supreme Court held that although the Commissioner of Income-tax had referred to the Indian Income-tax Act in passing the order of transfer, there were provisions which were almost similar to the Indian Income-tax Act to be fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act instead of section 35 of the old Act would take away the Income-tax Officer's jurisdiction to rectify the assessment. In our view if the notice issued by the Income-tax Officer purporting to be under section 154 of the new Act is treated as one under section 35 of the old Act, it cannot be considered to be defective or invalid and the validity of the notice does not depend upon the number of the section referred to therein. The validity of the notice will depend upon its substance and it is admitted that the notice issued in this case by the Income-tax Officer prior to the rectification contained all the essential requirements mentioned in section 35." This quotation is fully applicable to the facts of this case. The Income-tax Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make the correct order of assessment. In both cases, the Appellate Assistant Commissioner would be acting within the scope of his power as set out in section 251 of the Inicome-tax Act, 1961. It is only necessary to refer to the power set out in sub-clause (a) of sub-section (1) of that section, which reads: "(1) In disposing of an appeal, the Appellate Assistant Commissioner shall have the following powers: (a) in an appeal against an order of assessment he may confirm, reduce, enhance or annul the assessment; or he may set aside the assessment and refer the case back to the Income-tax Officer for making a fresh assessment in accordance with the directions given by the Appellate Assistant Commissioner and after making such further enq ..... X X X X Extracts X X X X X X X X Extracts X X X X
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