SETH GOVINDRAM GORDHANDAS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE assessee was assessed on March 31, 1939 by the Income-tax Officer, Special Circle, and on the next day the amendments to the Income-tax Act came into operation. On April 15, a demand for payment was made on the assessee. He applied under Sec. 27 of the Act to get the assessment set aside, but his application was rejected. On April 7, the Central Board of Revenue, acting under Sec. 5(2) of the Act, as amended, transferred the case of the assessee by name to the Commissioner of Income-tax, (Central). Now, this Court held in Dayaldas Kushiram v. THE Commissioner of Income-tax, (Central) (1), [1940]8ITR139(Bom) , that cases transferred under Section 5(2) of the Act could not include assessments already completed. That decision binds us, and it follows that the assessment, which was completed on March 31, 1939, was not included in the transfer of the assessees case. Any further proceedings relating to the assessee were validly transferred, but the completed assessment was not transferred.

(2.) ON May 10, the assessee appealed against his assessment, and his appeal was admittedly disposed of by the Appellate Assistant Commissioner, Secs. I to VI, A Range, Bombay. In my view, that Assistant Commissioner would have been the tribunal to hear the appeal, whether the transfer made on the 18th of April embraced this assessment or not, so that his entertainment of the appeal is a neutral act. The original assessment was made by the Income-tax Officer, Special Circle, and by virtue of Notifications 46 and 47 (2), (1939) 7 I.T.R. 121, published in the Gazette of India of June 3 and 10, 1939, Sections I to VI (Central), were in effect substituted for Special Circle and by Notification of February 24, 1940 (3) The Notification of February 24, 1940, is as follows :

(3.) KANIA, J. - Two point arise for consideration on this application; (1) whether after the assessment was made on March 31, 1939, the order transferring the case to the Commissioner of Income-tax, (Central), by the Central Board of Revenue, and thereafter by the order of the Commissioner of Income-tax, (Central), to the Income-tax Officer, (Central), was valid in law having regard to the fact that the assessment order was made before the amended Income-tax Act of 1939 came into operation. (2) If that transfer was invalid, whether the decision of the Appellate Assistant Commissioner, as given, was in his capacity as a subordinate to the Commissioner of Income-tax Bombay Presidency, Sind and Baluchistan, or as a subordinate to the Commissioner of Income-tax, (Central).