TaxTMI 
TaxTMI 
1978 (8) TMI 110
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....der s. 263 of the IT Act, setting aside the assessment and directing the ITO to make a fresh assessment according to law after giving reasonable opportunity to the assessee. 2. The asst. yr. In question is 1972-73 for which the previous year ended in 1971. In the relevant previous year the assessee derived income from business in Beedi leaves and house property. The income as per the return was Rs. 39,846 but the assessment was completed on an income of Rs. 50,039. The ITO assessed the business income by applying a higher rate of gross profit at 13 per cent of the total sales and on this score the addition was Rs. 5,000. There was some addition in the income from the house property and a few items of expenditure were disallowed. The asse....
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....ring an additional ground was raised with the permission of the Bench wherein it was submitted that the order of the CIT was without jurisdiction as the ITO's order had merged with the order of the AAC. During the course of arguments, it was also submitted that the CIT did not afford reasonable opportunity to the assessee to show-cause against the proposed order. This last ground was not raised either in the memo of appeal or in the petition raising an additional ground. 7. Taking the last ground first, we find that the assessee was given sufficient time to represent against the proposed order and he availed of it by filing an objection and appearing through counsel. This objection has no substance. 8. On merits, after perusal of the ....
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....rom consideration by the ITO is still resintegra. There are diverse decisions of different High Courts but on this specific point we don not have any direct decision of the Supreme Court or the High Court of Madhya Pradesh. 11. Counsel for the assessee relied on the decision of the Bombay High Court in CIT vs. Tejaji Farasram Kharawala (2). This decision can be said to be a leading case on the issue and various decisions rendered by the various High Courts and even the Supreme Court appear to follow the Principles stated therein. In CIT vs. Amrit Lal Bhogilal & Co.(3), the question of merger was elaborately considered. The Lordships of the Supreme Court followed the Principle in Tejaji Farasram Kharwala's case (2) but distinguished the s....
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....eliance was placed on the decision of the Gujarat High Court in Karsandas Bhagwandas Patel vs. G.V. Shah, ITO (6). This case does not refer to the power of the Commissioner under s. 263 of the IT Act. The Gujarat High Court was considering the power of the ITO to rectify his order in respect of a particular item which was not considered by him in the original assessment order which was carried before the AAC in appeal and was decided. The principles which might govern the ITO's power to rectify need not be extended to the power exercisable by a Commissioner under s. 263 of the Act. The reason as explained in Tejaji Farasram Kharawala's case (2) is that in an appeal by the assessee against the assessment order, the Department can raise all t....