Rectification of patent tax error is valid where remand limits the inquiry and the assessee had substantive notice.

A remand confined the Income-tax Officer to determining the quantum of loss, and later assessment proceedings were treated as valid because the assessee had substantive notice and participated through its representative. The text states that a notice is not invalid merely because it is not in the exact prescribed form if the substance shows compliance and a reasonable opportunity to be heard was afforded. It also treats the earlier allowance of the full claimed loss as a mistake apparent from the record, capable of correction through rectification jurisdiction.

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Issues: Whether the Income-tax Officer had jurisdiction to pass the subsequent assessment orders after the earlier order was made pursuant to remand, and whether the later order could be sustained as rectification of a mistake apparent from the record.

Analysis: The remand order required the Income-tax Officer only to determine the quantum of loss. The later proceedings were taken after notice to the assessee and discussion with its representative, and the form of the notice was held not ative where the substance showed compliance with the remand. The earlier error in allowing the entire claimed loss was treated as a mistake apparent from the record capable of correction under rectification jurisdiction. Reliance was placed on the principle that an adverse rectification order is not invalid merely because a separate formal notice was not in the exact form, if the assessee had knowledge of the proceedings and a reasonable opportunity was afforded.

Conclusion: The subsequent assessment orders were valid and the answer to the referred question was in the affirmative, against the assessee and in favour of the Department.

Ratio Decidendi: An income-tax order passed to correct a patent mistake while complying with a remand direction is valid where the assessee had notice in substance and a reasonable opportunity to participate, even if the notice is not in the precise form suggested for rectification proceedings.

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