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Issues: (i) Whether the corrigendum issued to complete the assessment order was invalid for want of power or limitation. (ii) Whether the reassessment was invalid for lack of proper material or application of mind. (iii) Whether the addition of on-money could be sustained when the assessee was not given effective cross-examination of the third parties whose statements formed the basis of the addition.
Issue (i): Whether the corrigendum issued to complete the assessment order was invalid for want of power or limitation.
Analysis: The assessment order contained an apparent omission in recording the concluding words relating to the addition, and the corrigendum did not alter the substance of the assessment or the computation. The correction was treated as a rectification of a typographical or inadvertent mistake and not as a review of the assessment order.
Conclusion: Decided against the assessee; the corrigendum was held to be valid.
Issue (ii): Whether the reassessment was invalid for lack of proper material or application of mind.
Analysis: The reasons recorded and communicated to the assessee were found to convey the basis for reopening, and the presence of a clerical error in the concluding part of the reasons did not vitiate the reopening. The assessee participated in the reassessment proceedings, and the material referred to was treated as sufficient for reopening.
Conclusion: Decided against the assessee; the reassessment was upheld.
Issue (iii): Whether the addition of on-money could be sustained when the assessee was not given effective cross-examination of the third parties whose statements formed the basis of the addition.
Analysis: The addition was founded on statements recorded from third parties during survey proceedings, but the assessee repeatedly sought cross-examination and was not afforded a proper opportunity. The Tribunal held that an addition resting on such material cannot be sustained without compliance with the principles of natural justice and effective cross-examination.
Conclusion: Decided in favour of the assessee; the addition was not sustained on this ground.
Final Conclusion: The challenge to the corrigendum and the reopening failed, but the addition could not survive for breach of natural justice, resulting in partial relief to the assessee.
Ratio Decidendi: A clerical corrigendum that does not change the substance of an assessment may be valid, but an addition founded on third-party statements cannot be sustained without granting the assessee a fair opportunity to cross-examine the persons whose statements are relied upon.
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