Separate authorization required for audit and assessment; non-territorial officer's orders were set aside and remanded.

A non-territorial assessing officer cannot validly conduct both audit and assessment on the basis of a single authorization; separate authorizations are required for each function. Applying that settled position, the HC found the proceedings invalid because the officer lacked distinct authorization for audit and assessment. The consequential assessment and penalty orders were therefore unsustainable and were set aside. The matter was remanded to the territorial assessing officer for fresh orders after granting the petitioner an opportunity of hearing.

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Issues: Whether a non-territorial assessing officer could validly conduct audit and assessment on the basis of a single authorization, and whether the consequential assessment and penalty orders were liable to be set aside.

Analysis: The petitioner's case was that the officer lacked separate authorization for audit and assessment and, being not the territorial assessing officer, could not validly undertake both functions. The Court applied the settled position that where an officer is not the territorial assessing officer, separate authorizations are required for audit and assessment; in the absence of both, the proceedings are invalid.

Conclusion: The assessment and consequential penalty were held unsustainable and were set aside, with the matter remanded to the territorial assessing officer for fresh orders after giving the petitioner an opportunity of hearing.

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