COMMISSIONER OF INCOME TAX Vs. VISWANATHAM G

JUDGEMENT

(1.) TWO questions are referred under Section 2 56( 1) of the Income-tax Act, 1961, one at the instance of the assessee and the other at the instance of the Revenue. The question referred at the instance of the assessee is :

(2.) AT the instance of the Revenue, the following question is referred:

(3.) IN view of the finding recorded by the Tribunal in its order aforesaid (dated September 9, 1974), the INcome-tax Officer reopened the assessment under Section 147 of the Act, with a view to include the balance of the interest amount in the income of the said assessment year. The assessee objected to the reopening of the assessment unsuccessfully. His appeal to the Appellate Assistant Commissioner was also unsuccessful. The matter was then carried to the Appellate Tribunal. Two questions were urged before, and considered by, the Tribunal, viz., (i) that the finding recorded by the Tribunal in its order dated September 9, 1974, that the entire interest amount of Rs. 62,000 accrued to the assessee during the accounting year relevant to the assessment year 1966-67 and that it ought to have been assessed as such, was a finding which was not necessary for an effective disposal of the appeal before it, and (ii) that the reassessment proceedings initiated under Section 147 are barred by virtue of Sub-section (2) of Section 150. The Tribunal held on the first question that "the finding is irretrievably linked up with the contention raised by the assessee. It is, therefore, evident that what the Tribunal decided is a necessary finding for the purpose of the effective disposal of the appeal before it. To our mind, therefore, the case clearly comes within the purview of Section 150(1)." On the second question, it found that the reassessment proceedings in this case are barred by Sub-section (2) of Section 150. Accordingly, it allowed the appeal and set aside the reassessment proceedings. Thereupon, both the Revenue and the assessee asked for referring a question each, which has been done by the Tribunal.