TaxTMI 
TaxTMI 
2005 (3) TMI 44
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....e circumstances of the case, the Tribunal was right in holding that powers under section 263 could be exercised by the Commissioner of Income-tax in respect of an order of the Income-tax Officer which was to the following effect: 'The assessee-company untraceable, proceedings dropped.' (2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in rejecting the plea of the assessee to the effect that powers under section 263 could not have been exercised by the Commissioner of Income-tax in respect of the order in question on the ground that the said order had not been served on the assessee? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in recording a finding ....
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....ssessment in accordance with law after making necessary inquiries and giving a reasonable opportunity of being heard to the assessee-company and to produce evidence, if any, in this regard. The said order came to be challenged by the assessee before the Tribunal, which for the reasons recorded in its order dated January 24, 1992, confirmed the order made by the Commissioner of Income-tax under section 263 of the Act, holding that the Commissioner of Income-tax had jurisdiction to exercise powers under section 263 of the Act; the Assessing Officer had dropped the proceedings without proper inquiry when the facts on record clearly necessitated such inquiry; such order of the Assessing Officer was erroneous and prejudicial to the interests ....
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....n Mica Industries Ltd. [1979] 120 ITR 627 (Cal). It is necessary to take note of the fact that on June 12, 1982, the assessee had filed a statement of advance tax payable under section 209A of the Act showing total income subject to advance tax at Rs. 1,35,404. Gross income-tax chargeable on the said income had been worked out at Rs. 76,332, and after taking credit for tax deducted at source of Rs. 2,332, net amount of tax payable was worked out at Rs. 74,000. In fact, in accordance with the aforesaid statement, the assessee had paid advance tax in three equal instalments of Rs. 24,667, totalling to Rs. 74,001. As already recorded hereinbefore, the Assessing Officer had issued notice under section 139(2) of the Act and there was failure ....
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.... account all relevant material which he may have gathered. This legal provision by itself is sufficient to empower the Commissioner of Income-tax to invoke section 263 of the Act and exercise jurisdiction. The action of the Assessing Officer in not making a best judgment assessment under section 144 (a) of the Act, despite failure of the assessee to file a return of income upon being served with a notice under section 139(2) of the Act, was itself an action which was erroneous in law. The assessee itself having submitted a statement of advance tax payable declaring income of more than Rs. 1,35,000 and having paid advance tax to the tune of Rs. 74,001, itself indicated that the assessee-company was having positive income in the year under....
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....] 41 ITR 539 (SC); and (2) CIT v. Bidhu Bhusan Sarkar [1967] 63 ITR 278 (SC). In the second decision, the words used were "the case is, therefore, filed". The settled legal position, therefore, is that even if the proceedings are dropped, terminated or filed, any such noting would amount to an order and it would be open to the Revenue to initiate reassessment proceedings or revisional proceedings upon the necessary conditions being fulfilled for the exercise of jurisdiction under one or the other provision. The Allahabad High Court decision in the case of Ramlal Kishore Lal [1972] 84 ITR 138, on which reliance has been placed on behalf of the assessee, instead of assisting the assessee, would go to support the stand adopted by the ....
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....ising statutory right of appeal. Section 263 of the Act states that the Commissioner may call for and examine the record of any proceeding under the Act, and if he considers that any order is erroneous, in so far as it is prejudicial to the interests of the Revenue, he may, pass such order thereon as the circumstances of the case justify after giving the assessee an opportunity of being heard and after making or causing any inquiry to be made. Such an order may include an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. The contention, therefore, that the noting made by the Assessing Officer in the present case was not an assessment order and could not be subjected to action unde....