COMMISSIONER OF INCOME TAX Vs. ABAD FISHERIES

JUDGEMENT

(1.) INCOME-tax Appeal No. 91 of 1999 is filed by the Revenue while I. T. A, No. 150 of 2000 is filed by the assessee. Both these appeals are filed challenging the order passed by the INCOME-tax Appellate Tribunal, Cochin Bench, in I. T. A. No. 607/Coch. of 1995. The relevant assessment year is 1991-92. The facts of the case are as follows :

(2.) WHILE working out the deduction under Section 80HHC, the assessee has included export bills amounting to Rs. 11,10,377 which have not been realised before six months from the end of the assessment year. The Chief Commissioner of Income-tax has permitted the assessee to bring the sale proceeds to India in convertible foreign exchange up to December 31, 1993. Since this amount was not been brought into India till date, the Assessing Officer found that the profit included in the above sale proceeds is not eligible for deduction under Section 80HHC of the Act. The assessee received Rs. 15,23,037 as interest from fixed deposits with various banks and others. The Assessing Officer found that these deposits were made not during the course of business. Since the assessee is having surplus funds, those amounts were deposited and interest was earned by the firm. Hence, he took the view that the deposit cannot be included in the present profit. Thus, the assessment was made and the income from the business was determined at Rs. 5,69,05,619.

(3.) THE first question for consideration is whether the assessment was valid. THE contention taken by the assessee is as follows : Section 143(1)(a) of the Act provides the procedure regarding assessment. Under Section 143(1)(a) of the Act, the officer can, after being satisfied about the return, send an intimation. This intimation shall be deemed to be a notice of demand issued under Section 156. THE intimation may be either that the amount is due as per the return filed by the assessee or that refund is due to the assessee. In this case there was no proceeding under Section 143(2) or (3). THE return was processed under Section 143(1)(a) of the Act. THEn notice was issued under Section 148 and finally, the order was passed under Section 143(3) of the Act. THE contention of the assessee is that since no order was passed under Section 143(3) of the Act before the notice was issued under Section 148, the procedure under Section 148 of the Act is invalid. We are not able to appreciate the contention of learned counsel for the assessee.