SATISCHANDRA AND COMPANY Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) FOR the assessment years 1979-80, 1980-81 and 1981-82, the Income-tax Appellate Tribunal, Bangalore, for short "the Tribunal", has referred the following question of law to this court with appropriate statement of case. As the issue involved in the appeals before the Tribunal was the same, the appeals were, for the sake of convenience, consolidated and heard together. One common order was passed in all the appeals. The reference applications were also disposed of by a common order and therefore this order shall dispose of the reference petitions for all the three years by a common order :

(2.) THERE was carried forward business loss of Rs. 10,20,700 pertaining to the assessment year 1976-77. The Income-tax Officer set off this carried forward loss and made the assessment for the assessment years 1979-80 and 1980-81 at nil income and the remaining loss of Rs. 3,64,983 against the income of Rs. 4,61,267 for the assessment year 1981-82. In short, the Income-tax Officer set off the loss suffered for the assessment year 1976-77 against the income earned for the years 1979-80, 1980-81 and 1981-82.

(3.) THE Department carried a further appeal before the Tribunal. THE contention of the Department before the Tribunal was that the assessee itself had shown interest income under the head "Income from other sources". In the assessments made, interest income had been assessed under the head "Income from other sources". Since interest income had been assessed under the head "Income from other sources" it was an obvious mistake committed on the part of the Income-tax Officer to have set off carried forward business loss against the interest income as well. It was stated that it was a patent mistake of law which was certainly rectifiable under Section 154 of the Act. THE assessee raised the same plea which it had raised before the first appellate authority.