TaxTMI 
TaxTMI 
2005 (8) TMI 291
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.... head Tank Lorry Operational Expenses Rs. 2,00,000 (c) Under the head Telephone Expenses Rs. 30,882 (d) Under the head Travelling Expenses Rs. 10,000 ------------ &nbs....
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....xpenses - as discussed above. Rs. 51,479 3. Travelling and conveyance - as discussed above Rs. 10,000 4. Interest paid on loan taken on personal a/c - as discussed Above Rs. 2,00,000 5. Transportation charges and Tank lorry operational Expenses - as discussed above Rs. 5,00,000 ------....
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....3 the same is appealable before the ld. CIT(A) in terms of section 246A of the Income-tax Act, therefore, there is no error in the order of the ld. CIT(A) in deciding the appeal and accordingly the ground taken by the revenue is rejected. 5. The ground No. 2 reads as under: "That on the facts and in the circumstances of the case the ld. CIT(A) erred in deletion of addition of Rs. 2,00,000 on the ground that there was no direction to make such enquiry on the line even though the assessment was set aside by the CIT in order under section 263 directing the Assessing Officer to make fresh assessment." 5.1 The ld. Departmental Representative submits that since the ld. CIT has set aside the whole assessment, therefore, the Assessing Officer was justified in disallowing Rs. 2 lakhs out of interest and bank charges of Rs. 2,11,058 on the ground that such interest was paid in personal capacity and not for business purposes. She further submits that the ld. CIT(A) has erred in deleting the disallowance by holding that under section 263 there is no such direction to the Assessing Officer to make any such enquiry on these lines and thus the Assessing Officer seems to have exceeded his....
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....the assessment or he may cancel the assessment and direct a fresh assessment. The Commissioner in the instant case has set aside the assessment for the years 1974-75 and 1975-76 and directed the Income-tax Officer to make a fresh assessment in accordance with the law so as to exclude the losses of the Cashew Department and Hessian department (if any) after giving adequate opportunity to the assessee. The order of the Commissioner setting aside the assessment and his direction to make a fresh assessment in accordance with the law cannot be read in isolation, but, it must be read in the context in which the Commissioner has exercised his powers of revision. We have seen on the facts of the case that all three businesses cannot be regarded as one and it was fairly represented before the Commissioner that the loss incurred by the assessee in the cashew department and the hessian department cannot be set oil against the profits from the insecticides department. The irresistible conclusion one reaches is that the set off of the loss from the two different and distinct businesses against the profits of other businesses was not warranted by the provisions of the law and the direction of th....
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....e original assessment have attained the finality. Therefore, in a setting aside assessment made by the Assessing Officer under section 143(3)/263 neither the assessee is allowed to challenge those additions which have attained the finality nor the revenue is permitted to make any other addition which was not the subject-matter of the original assessment. 5.8 This view also finds support by the following decisions: (i) In Murlidhar Bhagwandas v. CIT [1998] 234 ITR 548 (Bom.) it has been held at page 554 that- "Law is well settled that in proceedings before the Income-tax Officer for making a fresh assessment pursuant to the directions contained in an appellate order, only such issues can be agitated which have not attained finality. Similarly, in an appeal against the fresh order, only such issues which have not become final by the earlier orders of the appellate authority can be agitated. The assessee cannot be allowed to challenge the findings of the appellate authority collaterally before the Income-tax Officer in the proceedings for the fresh assessment. In the present case, the Income-tax Officer disregarded the direction of the Appellate Assistant Commissioner when he....
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....tion of Mr. J.C. Paul would have been unassailable but unfortunately the fact is not so. There was no dispute with regard to the assessability of the sale proceeds of the loom hours at any stage of the proceedings. The Appellate Assistant Commissioner also did not consider that question at all, inasmuch as, that was not one of the points before him in appeal. The order of the Appellate Assistant Commissioner setting aside the assessment was only partial and to the extent as to the question of treatment of a loss in speculative transaction, as clearly indicated in the order itself. The order of the Appellate Assistant Commissioner, if read as a whole in its proper context, would clearly show that it was neither the intent nor the purpose not the import of the order that the whole assessment was set aside and everything is kept at large so as to allow the Income-tax Officer to make a fresh assessment on all the aspects of the matter and give a free hand to the assessee to make all claims and all arguments in that assessment. In that view of the matter, we are unable to accept the contentions of Mr. J.C. Paul. The hands of the Income-tax Officer and in appeal against his order, of the....
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....e assessee, ought to be granted to the assessee by the Assessing Officer while framing the fresh assessment order. As a matter of fact in the case before us, the situation is entirely different, therefore, the ratio of the decisions cited in above para 5.9 is distinguishable and not applicable to the facts of the assessee's case. 5.11 In this view of the matter, we are of the view that since the disallowance of interest of Rs. 2 lacs was not the subject-matter in the original assessment, therefore, the Assessing Officer has exceeded his jurisdiction in making such disallowance of interest of Rs. 2 lakhs in the present assessment which is against the provision of the law and, accordingly, there is no error in the order of the ld. CIT(A) in deleting the disallowance of Rs. 2 lakhs. The ground taken by the revenue is, therefore, rejected. 6. Ground No.3 is against the relief of Rs. 4 lacs allowed by the ld. CIT(A) out of the disallowance of transportation charges and tank lorry operational expenses of Rs. 5 lakhs. 6.1 The ld. Departmental Representative submits that for the reasons as discussed in the assessment order, the ld. CIT(A) has erred in reducing the disallowance to ....