COMMISSIONER OF INCOME TAX Vs. R G UMARANEE

JUDGEMENT

(1.) IN pursuance of the directions of this Court in T.C.P. Nos. 49 and 50 of 1995, the INcome Tax Appellate Tribunal has stated the case and referred the following question of law in relation to the assessment year 1988-89 of the assessee :-

(2.) HOWEVER, the only question of law referred by the Appellate Tribunal is not correct, as seen from the order of this Court in T.C.P.Nos.49 and 50 of 1995, wherein this Court has directed the Appellate Tribunal to refer another question of law. The question that was also directed to be referred and reframed by this court reads as under:-

(3.) AS far as the first order of the Commissioner of the Income Tax is concerned, the Appellate Tribunal has cancelled the order of the Commissioner of the Income Tax only on the ground that the order of the Income Tax Officer was made under Section 143(1)(a) of the Act and since it was a summary assessment order, the Commissioner of Income Tax has no jurisdiction to revise the order of assessment. We are unable to accept the reasoning given by the Appellate Tribunal. Section 263 of the Act enables the Commissioner to call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the ASsessing Officer is erroneous in so far as it is prejudicial to the interest of the Revenue, it is open to the Commissioner to revise the order of the Income Tax Officer. Section 203 is widely worded and it would encompass any order passed by the ASsessing Officer which includes a summary order of assessment and the expression 'any order' is not qualified and restricted to the regular assessment order. The power given to the Commissioner by the Act is the revisional power and he is empowered to revise any order passed by the ASsessing Officer, which includes the order passed by the Income Tax Officer in his summary proceedings under Section 143(1)(a) of the Act as well. The scheme of the Act also discloses that 'any order' should be widely construed and unless there are grounds to show that the intention of the Legislature is to exclude the summary order of assessment from the purview of revision, we are unable to give a restricted meaning to the expression 'any order' excluding the summary assessment order. Learned counsel for the assessee has referred to some of the Board's circulars. We have carefully gone through the circulars issued by the General Board of Directors and the circulars only deal with the cases where the Board has directed that in the cases where there is a small or negligible tax effect and if the summary order of assessment has been passed, the Commissioner was advised not to initiate revision proceedings under Section 263 of the Act. We hold that the circular has no application to all situation and when the Commissioner is satisfied that the amount of tax involved is substantial, it is open to the Commissioner to exercise the power of revision even if the order of assessment is a summary assessment. We are of the view that the exercise of revisional power would be necessary and needed in case of summary assessments as the assessments are made without any inquiry and the assessments are completed according to the return of income submitted by the assessee.