TaxTMI 
TaxTMI 
1982 (5) TMI 3
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....rnest money and promised to pay the balance before or at the time of the execution of the sale deed. The petitioner could buy the property in his own name or in the name of his nominee or nominees partly in his name and partly in the names of his nominees and in one lot or in pieces and at one time or at different times. The possession of the bungalow except for the portion occupied by the Kapoor was delivered to the petitioner who was entitled to make additions or alterations therein without diminishing the value of the property. It was further agreed that the petitioner could prepare layout plan for the development of the said property and get the necessary sanction therefor. The transaction was agreed to be completed within two years, that is by May 18, 1969, provided Sri Kapoor vacated the portion occupied by then, and in case he did not do so the price would stand reduced by Rs. 5,000. It was further provided in the agreement that during the said period of two years if the petitioner wanted that any portion of the said property may be conveyed to any other person, the company would sell the same to the said person as the petitioner's nominee and the price was to be paid at the....
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....sp; ------ Total 63,268 ------ ------------------------------------------------------- The preamble further recited that the balance consideration of Rs. 71,732.00 had been paid by the petitioner to the company by means of various cheques. It had been agreed that out of the said payments the vendor was to sell the remaining property in favour of three persons : one to Mrs. Sandhu for Rs. 40,000; second portion to the petitioner's wife for Rs. 732 ....
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....2,20,625 -------- Less : Cost 1,35,000 -------- &nb....
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....l found that the real issues involved in the case had not been decided by the Revenue authorities and remanded the case to the ITO for making a fresh assessment. The conclusions arrived at by tile Tribunal were : " 1. That the assessee did carry out a business deal in purchasing the land and building and having plots thereof sold to various of his nominees. 2. That these sales which resulted in profit to the assessee took place in the previous year earlier to the previous year under consideration except for one sale of Rs. 40,000 to Mr. Sandhu, which alone was relevant for this year. 3. That the profits on transactions should be found out by estimating the cost price of the plot, and the land sold and considering the sale price for which that particular piece of land had been sold and treating the difference as the profit or the loss; and 4. That in so ascertaining the cost price, cost price of the building and the plot retained by the assessee should be excluded and the assessee should also be given the benefit of the development expenditure, if any, incurred for developing the land. " The Tribunal agreed with the Appellate Assistant Commissioner in respect of the o....
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....espondent-ITO has filed his counter-affidavits in both these petitions. In the counter-affidavit filed in the first writ petition in substance the case set up by him is that in its remand order the Tribunal has not precluded the ITO from looking into other points involved in the case. According to him the orders of the ITO and the AAC have been set aside and the matter has been restored to the file of the ITO for making the assessment afresh. The ITO thus thinks himself well within his rights to enquire into the other matters as well which are involved in the case and he has justified the issue of the notice under s. 148 as well for the reason that the petitioner's income had escaped assessment to tax. The impounding of the books and other documents as well has been justified for the same reasons. Two questions fall for our consideration in this writ petition Firstly, whether, after remand of the case by the Tribunal, the ITO could have gone beyond the directions given in the remand order and look into the matters which were not the subject-matter of appeal before the Tribunal. The second question is as to whether a notice under s. 148 could be issued when the assessment proceed....
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....ers of the Tribunal in dealing with appeals are expressed in the widest possible terms and are similar to the powers of an appellate court under the CPC. The Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The word " thereon " is significant inasmuch as it restricts the jurisdiction of the Tribunal to the subject-matter of the appeal. In other words, the original grounds of appeal and such additional grounds as may be raised by the leave of the Tribunal constitute the jurisdiction of the Tribunal. It can only adjudicate upon such grounds and not beyond them. It is not open to the Tribunal to adjudicate or give a finding on a question which does not constitute the subject-matter of the appeal as constituted by the original grounds of the appeal and such additional grounds as may be raised by the leave of the Tribunal. Further, the words "pass such orders thereon as it thinks fit " include all the powers except the power of enhancement which is conferred upon the AAC by s. 251. The distinction that the AAC is competent to examine all matters covered by assessment order while the Tribunal is to confine....
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....us comes out is that the powers of the AAC are wider than those of the Appellate Tribunal. The AAC while hearing an appeal under s. 251 of the Act can examine all matters covered by the assessment order and correct the assessment in respect of all such matters even to the prejudice of the assessee. He may remand the case to the ITO for enquiring into the items which were not the subject-matter of appeal also. If he sets aside an assessment and remands the case to the ITO for making a fresh assessment, the powers of the ITO while making the fresh assessment are the same as if he were making an original assessment under s. 143(3) of the Act. The AAC can, however, limit the powers of the ITO by giving suitable directions in regard to the scope of enquiry by the ITO. In the absence of such direction or restriction on the power of the ITO, while making a fresh assessment, the ITO is not bound by anything that had happened either when he made the original assessment or when the appeal was heard. When the remand is made by the Tribunal the position is different. The powers of the Tribunal are confined to the subject-matter of appeal as constituted by the original grounds of appeal and suc....
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....m not covered by these directions. Certainly the various notices issued by him under ss. 143(3) and 142(1) of the Act were not justified. This petition, therefore, is liable to succeed. Coming to the other petition, action can be taken under s. 147 of the Act in case certain conditions are satisfied. These conditions for the application of cl. (a) of s. 147 are that the ITO should have reason to believe that the income chargeable to tax has escaped assessment for the relevant year or has been underassessed or has been assessed at too low a rate or has been made the subject-matter of excessive relief or excessive loss or depreciation allowance has been computed. Further, he should have reason to believe that income has escaped assessment by reason of omission or failure on the part of the assessee to make return of his income under s. 139 for the year or to disclose fully and truly all material facts necessary for his assessment for the year. As for cl. (b), the ITO should have, in consequence of information in his possession, reason to believe that income has escaped assessment. In the notice which was issued under s. 148 to the petitioner it was not stated as to whether the ITO....