SHETH BROTHERS Vs. JOINT COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) "It has been said that the taxes are the price that we pay for civilization. If so, it is essential that those who are entrusted with the task of calculating and realising that price should familiarise themselves with the relevant provisions and become well-versed with the law on the subject. Any remissness on their part can only be at the cost of the national exchequer and must necessarily result in loss of revenue. At the same time, we have to bear in mind that the policy of law is that there must be a point of finality in all legal proceedings, that stale issues should not be reactivated beyond a particular stage and that lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity. So far as the income-tax assessment orders are concerned, they cannot be reopened on the score of income escaping assessment under section 147 of the Act of 1961 after the expiry of four years from the end of the assessment year unless there be omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment". This approach is propounded by the Apex Court in the case of Parashuram Pottery Works Co.Ltd. Vs. Income Tax Officer, Circle I, Ward I, Rajkot reported in 106 I.T.R.1. We may examine the present petition in light of this proposition laid down by the Apex Court.

(2.) The petitioner is a registered partnership firm. The relevant assessment years are 1990-91, 1991-92 and 1992-93. As the facts for all the three years are similar, at the request of both the sides all the three petitions were heard together and are being disposed of accordingly by this common judgment.

(3.) For assessment year 1990-1991, the relevant previous year ended on 31/3/1990. On 29/10/1990, the return of income declaring total income of Rs.36,41,000.00 was filed by the petitioner firm, and after scrutiny an assessment was framed under section 143(3) of the Act, on 25/3/1991 on total income of Rs. 36,42,600.00. It appears that thereafter revisionary proceedings were initiated and order under section 263 of the Act was passed on 25/3/1993, whereby the assessment order dated 25/3/1991 was set aside on the ground that deduction under sections 80HH and 80I had been erroneously allowed in the said assessment.