COMMISSIONER OF INCOME TAX Vs. MARIKAR MOTORS LIMITED

JUDGEMENT

(1.) The assessee, M/s Marikar Motors Limited, Trivandrum is a company registered under the Indian Companies Act. In respect of the assessment years 196465, 196667 and196768 it was assessed to income tax. The orders of assessment were carried up in appeal and in further appeal to the Income Tax Appellate Tribunal. In respect of the latter two years, viz., 196667 and 196768, the orders of the Appellate Tribunal were passed after 1st April 1971, viz., on 30th November 1971. (The significance of the date 1st April 1971 will presently appear). Bat, for the assessment year 195465, with which we are concerned in this reference, the order of the Tribunal was passed on 22nd August 1970. After the Tribunal passed the said order, the Surtax Officer, acting under the provisions of S.14 of the Companies (Profits) Surtax Act, 1964, read with S.13 thereof, proceeded to take action by way of recomputation of the assessment and amendment of the assessment order. S.13 and 14 of the said Tax Act are as follows

(2.) We think, the Tribunal was right in its view. On the terms of S.14 itself there are a few things which stand out clear: First, that the right of action with respect to an order passed by the Appellate Tribunal under S.254 of the Act was itself granted for the first time only by the Taxation (Amendment) Act of 1970 with effect from 1st April 1971. Next, the right conferred is only to recompute the chargeable profits determined in any assessment under the Surtax Act; and third, that the said right of recomputation springs from any order, inter alia, under S.254 of the Income Tax Act. Subject to

(3.) Counsel for the revenue cited to us the decision of the Andhra Pradesh High Court in Freny Rashid Chewai v. Assistant Controller of Estate Duty 90 ITR 31and of the Supreme Court in Mahendra Mills Ltd. v. P. B. Desai, A. A. C. 99 ITR 135. The former of these decisions has no application to the facts of this case. The only question which there arose was whether the award passed by the Assistant Controller, which was modified on reference by the Civil Court would entitle the Estate Duty Officer to treat the Civil Court's order as part of "record" for the purpose of S.61 of the Estate Duty Act. It was held that it could be so treated as part of the "record". The complicating feature in this case of the power itself having been conferred only on and from a certain date, and of the officer seeking to rectify the order passed on an anterior date, did not arise for consideration and was not dealt with in the judgment,