KRISHNAMURTHY V G Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) FOR the asst. yr. 1975-76 relevant to the accounting year ending with March 31, 1975, the petitioner filed his return under the IT Act, 1961 (hereinafter referred to as the "Act" ), before the ITO, Assessment 9, Circle-1, Bangalore (hereinafter referred to as the "ITO"), disclosing a net income of Rs. 1,02,492. On an examination of that return, but without following the mandatory requirements of s. 144B of the Act that had come into force from January 1, 1976, the ITO on January 5, 1979, completed the assessment (Ext. A) enhancing the declared income of the petitioner to Rs. 3,05,582 or Rs. 3,05,580 and issued to him a demand notice thereto under the Act.

(2.) AGAINST the said order of the ITO, the petitioner has filed an appeal under s. 246 of the Act before the AAC (hereinafter referred to as the "AAC"), Range-I, Bangalore, challenging it on diverse grounds. Even before the AAC could hear the said appeal, the CIT, Karnataka-II, Bangalore (hereinafter referred to as the "CIT"), by his notice No. L.Rev. No. 3178-II, dated May 27, 1975 (Ext. B), proposed to suo motu revise the said assessment order made by the ITO under s. 263 of the Act, the validity of which is challenged by him in this writ petition under art. 226 of the Constitution.

(3.) SRI K.R. Prasad, learned counsel for the petitioner, contends that the order made by the ITO made in contravention of s. 144B of the Act, though erroneous, was not prejudicial to the interests of the Revenue and therefore it was not open to the CIT to exercise the suo motu power of revision under s. 263 of the Act. In support of his contention, SRI Prasad strongly relied on a Division Bench ruling of this Court in Uchal vs. Commissioner of Commercial Taxes (1967) 20 STC 67 (Mys).