TaxTMI 
TaxTMI 
1982 (9) TMI 48
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....eir request contained in the said letter to change the previous year to July/June and to prepare accounts for the period of 18 months from 1st January, 1976. The letter stated that the Government's annual newsprint policy covered the period April to March and was usually announced in May. It, therefore, became unrealistic for the petitioners to work on the budget and review the performance for business decisions and action for almost five months in their accounting year. By changing the accounting year to July/June, this difficulty would be overcome and it would facilitate decision making. On 28th February, 1976, the budget proposals were announced and contained some reliefs to newspapers. On 3rd April, 1976, the petitioners wrote to ....
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....petitioners to intimate to him whether they were agreeable to the conditions mentioned. On 3rd May, 1976, the petitioners informed the ITO that they were so agreeable. Appropriate resolutions were passed by the petitioners' board and accounts were prepared on the aforesaid basis. On 26th May, 1976, the Finance Bill received assent. It incorporated the relief to newspapers. On 24th January, 1977, the CIT, Bombay City VI, addressed to the petitioners a notice under s. 263 of the Act. The notice stated that the ITO's order dated 15th April, 1976, giving approval to the change in the previous year was erroneous and prejudicial to the interests of the Revenue. At the time when the order was made the Finance Bill had been introduced but its....
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....n the previous year was set aside and the ITO was directed to pass a fresh order according to law after safeguarding the interests of the Revenue and after allowing an opportunity to the petitioners to be heard. On 21st March, 1979, the first respondent, then the petitioners' ITO, passed this order : " The assessee has applied, vide their letters dated 25-2-1976 and 3-4-1976, that they may be permitted to change the previous year from the calendar year to the year ending on 30th April, 1976, The change requested for was originally granted by my predecessor, vide his letter dated 15th April, 1976. The CIT, vide his order under section 263 dated 25-6-1977 has set aside the above-mentioned change in the previous year. After a careful con....
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....all for and examine the record of any proceedings under this Act, and if he considers that any order passed therein by the Income-tax Officer is erroneous in so far as it is prejudicial to the interests of the Revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment." It is thus clear that the Commissioner can only revise: (a) an order, and (b) an order that is prejudicial to the interests of the Revenue. It was Mr. Kolah's submission that under s. 3(4) of the Ac....
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....xisted when the ITO passed the order under s. 3(4) and the law as it stood then. It was, therefore, not open to the Commissioner to take the Finance Bill that became law subsequent to the ITO's order into account. Mr. Joshi is right when he points out that at the time the ITO passed the order the budget proposals had been announced and were validly taken into consideration by the Commissioner in passing the order under s. 263. Mr. Kolah submitted that the doctrine of promissory estoppel applied in that the petitioners bad acted upon the order granting consent and had prepared their accounts accordingly and had, therefore, altered their position to their prejudice. This argument can be disposed of simply: no estoppel can operate against t....