GEORGE PAUL PUTHURAN Vs. COMMISSIONER OF WEALTH TAX

JUDGEMENT

(1.) AS required by this court, the Income-tax Appellate Tribunal, Cochin Bench, referred the following questions of law at the instance of the assessee :

(2.) THE matter arises out of the wealth-tax assessments for the assessment years 1967-68, 1968-69 and 1969-70 for which the valuation dates are August 16, 1966, August 16, 1967, and August 16, 1968, respectively. Assessments for the years 1967-68 and 1968-69 were originally completed on March 31, 1970, and the assessment for the year 1969-70 was completed on October 22, 1970. THE property of the assessee was acquired by the Government in 1961 under the Land Acquisition Act and the compensation given by the authority was included in the assessment. THE compensation was includible in these assessments. THE assessee also agitated for enhanced compensation which was awarded by the court subsequently on October 28, 1968. THE Income-tax Officer thereafter reopened the assessments under Section 17 of the Wealth-tax Act pursuant to which returns were filed by the assessee for the aforesaid three assessment years on November 4, 1975, showing Rs. 3,34,548, Rs. 3,50,133 and Rs. 3,65,718, respectively, as compensation and interest. THEse returns were accepted by the Wealth-tax Officer. THEse amounts represented compensation and interest, though the split-up had not been shown in the return. THE asses-see filed appeals to the Appellate Assistant Commissioner. According to the Revenue, the assessee had challenged only the inclusion of interest, in the assessments, but according to the assessee, he has challenged also the inclusion of the enhanced compensation. THE Appellate Assistant Commissioner passed an order stating that the only ground urged before her was the inclusion of interest as being bad in law as such inclusion was held to be incorrect by the Tribunal in I. T. A. No. 27(Coch) of 1974-75 dated July 26, 1975, in the case of the same assessee. THE Appellate Assistant Commissioner deleted the inclusion of interest. THEreafter, the assessee filed a petition for rectification of the order praying that the additional compensation awarded by the court also should be excluded from the assessment for these three assessment years. THE Appellate Assistant Commissioner rectified the assessment under Section 35(8) of the Wealth-tax Act directing exclusion of the principal amount of additional compensation as well. THE Revenue thereafter filed appeals before the Tribunal. It was contended on behalf of the assessee that such appeals by the Revenue are not maintainable since no express provision is made for the filing of appeals against the orders passed under Section 35(8). This preliminary objection raised by the assessee regarding the maintainability of the appeals was rejected by the Tribunal and in so doing, the Tribunal relied upon the decision in CWT v. B.M. Ramalingam [1983] 140 ITR 219 (Mad). THE Tribunal held that there was no mistake in the original order of the Appellate Assistant Commissioner. In that original order, the Appellate Assistant Commissioner had deleted only the addition of interest. THE extra compensation received by the assessee and returned by him for these three assessment years had been retained by the Appellate Assistant Commissioner in the assessments. This was in conformity with the decision of the Supreme Court in Mrs. Khorshed Shapoor Chenai v. Assistant CED [1980] 122 ITR 21. Since the assessment of the additional compensation in these three assessment years was in conformity with the decision of the Supreme Court, the Appellate Tribunal cancelled the order passed under Section 35(8) by the Appellate Assistant Commissioner. It is thereafter that the aforesaid two questions were referred to this court for opinion.

(3.) IN the decision reported in S. Sankappa v. ITO [1968] 68 ITR 760, the Supreme Court also had an occasion to examine the nature of the proceedings for rectification. The Supreme Court considered the proceedings taken for rectification of assessment to tax and held that they are proceedings for assessment. The Supreme Court observed (at page 764) :