1988 (12) TMI 65

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....ered by S. S. SODHI J.-The question of law referred for the opinion of this court is in the following terms : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in annulling the reassessment framed by the Income-tax Officer in pursuance of notice under section 147(a) on the ground that it was a case in which the provisions of section 147(b) and not sec....

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....ter, on appeal, was reduced to Rs. 32,580. In the meanwhile, the levy of royalty under the Brick Price, Control Orders which had been challenged in writ proceedings before our High Court was decided on March 25, 1971, in Amar Singh Modi Lal. v. State of Haryana, AIR 1972 P & H 356 [FB], wherein it was held that the Government was not competent to levy any royalty. It was thereafter that on F....

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..... Further, it was observed that the royalty amount had been duly mentioned in the balance-sheet and the Income-tax Officer was supposed to have gone through it and, therefore, this was a case which could have been further processed only under section 147(b) of the Act and not under section 147(a) of the Act and the reassessment thus made in pursuance of the notice under section 148 of the Act bein....

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....tter, the Supreme Court held that after discovery of the primary facts relating to the transactions evidenced by the drafts, it was for the Income-tax Officer to make the necessary enquiries and draw proper inference as to whether the amounts represented by the drafts could be treated as part of the total income of the firm. This the officer did not do. It was plainly a case of oversight and it co....