TaxTMI 
TaxTMI 
2001 (11) TMI 44
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....ner was that he received summons from the court of the Chief Judicial Magistrate, Shimla, stating therein that proceedings have been initiated against him by the respondents for the above assessment years for commission of certain offences under the Income-tax Act, 1961 (hereinafter referred to as "the Act"). It is stated by the petitioner that for the four assessment years 1979-80, 1980-81, 1981-82 and 1982-83, the petitioner was assessed in accordance with law but thereafter notices were issued to him under section 271C of the Act for not paying legal income-tax and he was asked whether he was ready and willing to get the cases compounded. Pursuant to the said notice, the petitioner appeared before the Income-tax Officer and showed his willingness to get the cases compounded. Accordingly, on March 18, 1999, orders were passed compounding the cases pending against him (annexure PB). The relevant part reads as under: "In this connection, I am to inform you that you will pay compounding fee before composition of prosecution for each of the years as under: ------------------------------------------------------------------------ Assessment year: 1979-80  ....
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....-------- Assessment year: 1981-82: ------------------------------------------------------------------------ Income declared in the original return: 26,270 Income assessed after appeal effect: 92,630 Income sought to be concealed: 66,410 Amount of tax on it calculated at 60 per cent. 39,346 ------------------------------------------------------------------------ Assessment year: 1982-83: ------------------------------------------------------------------------ Income declared in the original return loss(-) 5,650 Income assessed after appeal effect: &nb....
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....ed a communication on October 25, 2000 (impugned in the present petition at annexure PK). The said communication, by the Income-tax Officer, Ward No. 4, Shimla, stated that the compounding charges had not been correctly calculated in the letter dated March 18, 1999. As in the case of the petitioner, the "total concealed income" exceeded Rs.1 lakh, the compounding fee payable by him would be more than the said amount and as such he was liable to pay Rs.3,51,304. The case, therefore, could not have been compounded and accordingly proceedings launched against him would proceed. The said action of the Department is challenged by the petitioner in these petitions. We have heard learned counsel for the parties. Several contentions have been raised by learned counsel for the petitioner. It is, however, not necessary for us to enter into the larger question. From the record, it is amply clear that the allegation of the Department against the petitioner was that there was concealment of income-tax by the petitioner in four assessment years 1979-80, 1980-81, 1981-82 and 1982-83. It is also not in dispute that the four cases have been instituted before a competent court. Even in the pre....
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....me-tax Department, and clause (3) of section 25A will have no application." In M.M. Ipoh v. CIT [1968] 67 ITR 106, the apex court observed that the doctrine of res judicata does not apply so as to make a decision on a question of fact or law in a proceeding for assessment in one year binding in another year. The assessment and, the facts found are conclusive only in the year of assessment; the findings on a question of fact may be good and cogent evidence in subsequent year, when the same question falls to be determined in another year, but they are not binding and conclusive. A similar view was taken in Sri Ramdas Motor Transport Ltd. v. Tadi Adhinarayana Reddy [1997] 90 Comp Cas 383 (SC). It is no doubt true that if a question of law has been decided independent of the assessment year such as, the constitutional validity or vires of an Act, such a decision would operate as res judicata even in future litigation and cannot be challenged (vide Amalgamated Coalfields Ltd. v. Janapada Sabha Chhindwara, AIR 1964 SC 1013). But, so far as the assessment years are concerned, it is well settled that each assessment year is an independent unit. In these circumstances, in our opini....