UTKAL GALVANIZERS P LTD Vs. ASSISTANT COMMISSIONER

JUDGEMENT

(1.) THE petitioner in this writ application seeks to challenge an order dated March 14,1995, passed under Section 154 of the Income -tax Act, 1961, by the Assistant Commissioner of Income -tax, Cuttack Circle for the assessment year 1991 -92, inter alia, exercising his power under Section 154(1A) purportedly seeking to revise the depreciation earlier allowed to the assessee and seeking to levy interest under Section 234B (allegedly on the ground of having omitted to make such levy at the time of passing the order under Section 143(3)) and therefore, seeking to rectify the aforesaid mistake by passing the impugned rectification order under Section 154 and raising an additional demand of Rs. 9,89,700. The assessee being aggrieved by such order, filed a revision under Section 264 of the Act before the Commissioner of Income -tax, Orissa, and the revision having been rejected vide order dated February 28, 1996, the present writ application has been filed challenging the said order under Section 154 as well as the revisional order.

(2.) THE assessee filed its return for the year 1991 -92 disclosing income of Rs. 2,76,306 on December 30, 1991, whereafter it was duly assessed under Section 143(1)(a) and by order dated March 7, 1994, total tax and interest was assessed at Rs. 1,45,084 and it was determined that since the assessee has already deposited tax of Rs. 1,67,362, an amount of Rs. 30,358 was found to be refundable. It is further alleged that instead of effecting refund as determined in the order of assessment as indicated above, the Assessing Officer instead issued a notice under Section 143(2) to the assessee and pursuant to such notice, the income of the assessee was determined at Rs. 13,59,510, essentially by making additions under two heads, namely, (1) trading account -Rs. 9,38,989, and -(2) scrap sale -Rs. 1,10,487. Being aggrieved by the said order, the assessee carried an appeal to the Commissioner of Income -tax (Appeals) and by order dated January 25, 1995, the Commissioner of Income -tax (Appeals) was pleased to quash the enhancement/additions made by the Assessing Officer both on account of trading account as well as scrap sale, but came to determine that since there was stock discrepancy of Rs. 2,52,000, the said amount should be taken into account for the purpose of levy of tax thereon. In other words, while the enhancement effected by the Assessing Officer was quashed, yet an addition for discrepancy in stock of Rs. 2,52,000 was directed by the Commissioner of Income -tax (Appeals).

(3.) PURSUANT to the said show -cause notice, the assessee filed its objections, inter alia, on the ground that the proposed Section 154 action was no longer available since the very order which was sought to be corrected or rectified, had already merged in the appellate order passed by the Commissioner of Income -tax (Appeals) and on the ground that the notice did not specifically point out as to where excess depreciation has been allegedly allowed.