COMMISSIONER OF INCOME TAX Vs. KANTILAL R PATEL

JUDGEMENT

(1.) At the instance of the revenue, following two questions are referred to this Court :-

(2.) In this case, the Commissioner of Income-tax had exercised revisional powers under Section 263 of the Income-tax Act, 1961 while passing an order on 29.3.1984 wherein he had come to the conclusion that the interest was chargeable upon the assessee under Section 215 of the Act and the same was not charged by the Income-tax Officer on finalization of the assessment under Section 143(3) on 31.3.1982. The order of assessment was, therefore, erroneous and prejudicial to the interests of the revenue. The Commissioner, therefore, directed the Income-tax Officer to charge the same under Section 215 of the Act by passing appropriate order.

(3.) The said order of the Commissioner was challenged in appeal by the assessee before the Income-tax Appellate Tribunal, Ahmedabad and the Tribunal, vide its order dated 22.10.1985 and for the reasons recorded therein had come to the conclusion that there was no financial loss to the revenue. While recording that finding, the Tribunal had followed the decision of the Madhya Pradesh High Court in the case of H.H. Maharaja Raja Pawer Dewas vs. CIT, (1982) 138 ITR 518 and had held that the revisional order passed by the Commissioner under Section 263 of the Act was invalid and was not sustainable.