CHITRA CINEMA Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THE petitioner claims to be a partnership firm consisting of Jyoti Bhushan Gupta, his wife, Srimati Sulbha Gupta, and their son, Anil Kumar Gupta. THE firm carries on the business of exhibiting cinematograph films at the Chitra Cinema, Varanasi. THE petitioner filed the returns of its income in respect of the assessment years 1958-59 and 1959-60 in the status of a partnership firm. the income-tax Officer assessed the petitioner in the status of an association of persons. THE petitioner appealed against the assessments and the Appellate Assistant Commissioner held that the income of the cinema business belonged to Jyoti Bhushan Gupta as an individual. the case was carried in further appeal to the Income-tax Appellate Tribunal. THE Tribunal affirmed the finding of the Appellate Assistant Commissioner and setting aside the assessment orders remanded the case. THE order of the Tribunal was made on April 2, 1962. No fresh assessment has yet been made upon the petitioner. the petitioner, however, dissatisfied with the order of the Tribunal, has obtained a reference to this court arising out of the Tribunals appellate order. That reference is still pending.

(2.) THE Income-tax Officer, A Ward, Varanasi, has passed an order under section 210 of the Income-tax Act, 1961, calling upon the petitioner to pay advance tax in the sum of Rs. 37,920 for the financial year 1963-64. the order was made on July 30, 1963. It appears from the order that the amount of advance tax was determined on the basis of the total income of the previous year relevant to the assessment year 1959-60. By a notice of demand of the same date the petitioner has been called upon to pay the said amount of advance tax. Proceedings for recovering the advance tax are being taken by the Income-tax Officer against the petitioner and the furniture of the Chitra Cinema has been attached. THE petitioner prays for relief against the order under section 210 , the notice of demand and the related recovery proceedings.

(3.) IT is clear from the provision of section 209 that for the purposed of computing the amount of advance tax payable in a financial year the starting point is the total income of the latest previous year in respect of which a regular assessment has been made. The subsequent computation proceeds on its basis. if the assessment of that total income has been set aside, it is not open to the Income-tax Officer to consider that total income for the purpose of computing the amount of advance tax. An assessment which has been set aside exists no longer. IT cannot constitute any basis for computing the amount of advance tax. Parliament, when it enacted section 209 , could not have intended that an assessment of total income which has been set aside should form the basis of the computation.