Auditor appointment during block assessment upheld where statutory complexity and Revenue-interest conditions were satisfied

Appointment of an auditor under section 142(2A) is valid where block assessment proceedings under section 158BC are pending, because such proceedings are assessment proceedings and satisfy the statutory precondition. The authority's satisfaction that the accounts are complex and that audit is necessary in the interests of the Revenue is generally not open to reappraisal in writ jurisdiction when based on relevant material. The auditor appointment was therefore upheld and no writ interference was warranted.

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Issues: Whether the appointment of an auditor under section 142(2A) of the Income-tax Act, 1961 was valid during pendency of block assessment proceedings under section 158BC, and whether the writ court could interfere with the authority's satisfaction.

Analysis: Section 142(2A) permits audit where an assessment proceeding is pending and the accounts are of such nature and complexity that audit is necessary in the interests of the Revenue. Block assessment proceedings under section 158BC are also assessment proceedings, and their pendency satisfies the statutory precondition. The decision to appoint an auditor depends on the authority's satisfaction regarding complexity and Revenue interest, and such satisfaction cannot ordinarily be reappraised in writ jurisdiction when formed on relevant material.

Conclusion: The appointment of the auditor was held to be legally valid and no ground for interference in writ jurisdiction was made out.

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