TaxTMI 
TaxTMI 
2004 (11) TMI 96
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....leted and revised in respect of all the four assessment years, where-under the rate of tax of 65 per cent, plus surcharge was applied. The respondent moved separate applications dated April 16, 1981, seeking rectification of the assessment orders on the ground that the rate of tax should be 55% plus surcharge as it was an industrial company. In the return filed by the respondent it had mentioned at page 2 of Part I that it was a trading company. Before the Income-tax Officer, the respondent took a stand that it was the duty of the Assessing Officer to allow statutory benefits and there was no question of taking advantage of its ignorance as to its rights. The Income-tax Officer, however, rejected the applications under section 154 of the Act and declined to treat the respondent as an industrial company in view of its own stand vis-a-vis the return filed. Feeling aggrieved by the orders, the respondent preferred separate appeals before the Commissioner of Income-tax (Appeals) who had allowed the appeals by observing that the capacity in which the respondent was to be assessed and the rate which was to be properly applied, was not dependent upon the description given in the return by....
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....his aforesaid submissions, he has relied upon the following decisions: (i) T.S. Balaram, ITO v. Volkart Bros. [1971] 82 ITR 50 (SC); and (ii) CIT v. Hero Cycles P. Ltd. [1997] 228 ITR 463 (SC). Learned counsel for the respondent, on the other hand, submitted that the respondent was an industrial company as it was engaged in the manufacture, sale and export of brass artwares, a fact which is not being disputed by the Revenue. According to him, the Income-tax Officer himself has treated the respondent as an industrial company during the assessment year 1978-79 and had also rectified the mistake under section 154 of the Act in respect of the assessment year 1977-78 by treating it as an industrial company. In respect of the assessment year 1979-80, the Tribunal has also held the respondent to be an industrial company. He submitted that the respondent ought to have granted the benefit of lower rate of tax if the same was admissible and merely because a mistake was committed by the respondent in not staking a claim, the benefit should not have been denied. He relied upon a circular issued by the Central Board of Direct Taxes dated April 11, 1955, to the effect that where an assessee w....
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....e point of law is not a mistake apparent from the record. In the aforesaid case, the facts were that the original assessments of Volkart Brothers, a firm duly registered under the Acts, were made on the slab rates prescribed under the respective Finance Acts applicable to registered firms. In the individual assessment of the partners of the firm, their respective shares were included and the tax was assessed at the maximum rate since the partners were assessed as non-residents. The Income-tax Officer initiated the proceeding under section 154 of the Act as there was a mistake apparent on the record inasmuch as the firm had not been charged at the maximum rate of tax under section 17(1) of the Indian Income-tax Act, 1922. The Income-tax Officer rectified the assessment by applying the provisions of that section. On these facts, the apex court has held that the question whether sections 17(1) and 2(9) of the Indian Income-tax Act, 1922 were applicable to the case of the firm was not free from doubt and it was not open to the Income-tax Officer to go into the true scope of the provisions of the Act in a rectification proceeding under section 154 of the Act and the Income-tax Officer w....
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....strial company. The necessary details may or may not be available on record and merely because the respondent had claimed itself to be a trading company under some mistake, would not ipso facto mean that it is an industrial company. If there are materials available on record in respect of each assessment year that the respondent is engaged in the business of manufacturing and processing of goods and its income not less than 51 per cent. before deduction under Chapter VIA of the Act is attributable to such manufacturing or processing activities, it would be an industrial company. In the case of Anchor Pressings (P.) Ltd. v. CIT [1986] 161 ITR 159, the apex court has held that an obligation is imposed on the Income-tax Officer by section 84 of the Act to grant relief thereunder and it could not be refused merely because the assessee had omitted to claim the relief. But mere existence of such an obligation on the Income-tax Officer is not sufficient. Before the Income-tax Officer can grant relief, there must be clear data in the assessment record sufficient to enable him to consider whether the relief should be granted under section 84 of the Act and if there is no such material, no ....