COMMISSIONER OF INCOME TAX Vs. N KRISHNAN

JUDGEMENT

(1.) THESE references at the instance of the Revenue arise out of a common order passed by the Income-tax Appellate Tribunal, Cochin Bench, in I. T. A. Nos. 1299/Coch. of 1987 and 135/Coch. of 1988, and the cross-objections C. O. No. 11 (Coch.) of 1988 in I. T. A. No. 135/Coch. of 1988. The relevant assessment year is 1981-82. The following is the question raised in I. T. R. No. 124 of 1994 :

(2.) THE assessee is a cashew exporter. He had also business in foreign liquor and toddy and was deriving share income from certain firms. For the previous year, relevant for assessment year 1982-83, the assessee filed a return of income on November 3, 1983, admitting a loss of Rs. 58,216. THE total loss returned was Rs. 11,53,920. Since the assessee did not comply with the requirements of notices issued by the Income-tax Officer, ex parte assessment was passed under Section 144 of the Income-tax Act on September 12, 1984. Notice of demand along with the assessment order was served on the assessee's advocate. On the basis of a petition dated September 15, 1984, filed in the name of the assessee but signed by his advocate, the ex parte assessment was cancelled under Section 146 on September 24, 1984, and fresh assessment was completed on March 27, 1987, making certain additions, etc. Thus, against the income initially assessed under Section 144 at Rs. 2,16,336, the income that is finally determined came to Rs. 23,28,394. Aggrieved by the fresh assessment order, the assessee filed an appeal before the Commissioner of Income-tax (Appeals) who confirmed the assessment with slight modifications. THE assessee filed I. T. A. No. 1299/Coch of 1987 before the Income-tax Appellate Tribunal and the Revenue filed I. T. A. No. 135/Coch of 1988 against that portion of the order of the first appellate authority where relief was granted to the assessee. THE assesses had filed a cross-objection in I. T. A. No. 135/Coch. of 1988.

(3.) LEARNED counsel further pointed out that even in the cross-objection filed to the appeal filed by the Revenue, this point has been taken by the assessee before the Tribunal. Referring to the terms of the vakalath, learned counsel would contend that it has not specifically authorised the advocate to file a petition under Section 146 of the Income-tax Act on behalf of the assessee. If that be so, any proceeding taken by the assessing authority on the basis of such a petition cannot survive legal scrutiny and, therefore, the Tribunal was fully justified in holding that the order dated September 24, 1984, was void in the eye of law so also further assessment dated March 27, 1987.