Doctrine of merger bars revision of an assessment once an appellate order has replaced the original order.

Where an assessment order has merged into an appellate order, the original assessment no longer survives as an independently revisable order. The revisional authority under section 16 of the Companies (Profits) Surtax Act, 1964, could therefore not reopen the same assessment by issuing a revisional notice after appellate adjudication. The doctrine of merger barred exercise of revision at the threshold, because the appellate order became the operative order in law. The notice and proceedings under section 16 were accordingly without jurisdiction and liable to be quashed.

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Issues: Whether the notice issued under section 16 of the Companies (Profits) Surtax Act, 1964, was without jurisdiction because the assessment order had already merged with the appellate order.

Analysis: The revisional power under section 16 could be exercised only in respect of an order that still survived in law. Once the assessee's assessment had been taken in appeal and the appellate authority had passed an order, the original assessment ceased to be independently open to revision by applying the doctrine of merger. The appellate order became the operative order, and the Commissioner could not reopen the same assessment by issuing a revisional notice. In the facts of the case, the proposed revision was therefore barred at the threshold.

Conclusion: The notice and the proceedings initiated under section 16 were without jurisdiction and were liable to be quashed in favour of the petitioner.

Ratio Decidendi: Where an assessment order has merged in the appellate order, the revisional authority cannot exercise jurisdiction to revise the original order.

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