COMMISSIONER OF INCOME TAX Vs. REWASHANKER A KOTHARI

JUDGEMENT

(1.) The Income Tax Appellate Tribunal, Ahmedabad Bench "C" has referred the following two questions under Section 256(1) of the Income Tax Act, 1961 (the Act) at the instance of the Commissioner of Income Tax, Rajkot.

(2.) The assessment year is 1987-88 and the relevant previous year is the year commencing on 1st July 1985 and ending on 30th June 1986. The assessee was originally assessed u/s 143(1) of the Act on 28-7-1987. The Commissioner of Income Tax, Rajkot (CIT) issued notice u/s 263 of the Act on 19/2/1990. The assessee submitted a detailed reply dated 2/3/1990. However, the CIT passed an order on 12/3/1990 in the following terms:

(3.) The assessee carried the matter in appeal before the Tribunal. After hearing both the sides, the Tribunal made an order on 11/6/1992 holding that the CIT had incorrectly exercised jurisdiction under Section 263 of the Act and also, in the process, holding that, on facts, the Commissioner had failed to point out any error committed by the Assessing Officer.