COMMISSIONER OF INCOME TAX Vs. PUSHPA DEVI

JUDGEMENT

(1.) THESE are six references under Section 256(1) of the Income -tax Act, 1961 (hereinafter called "the Act"), and relate to the assessment years 1968 -69 to 1973 -74, The core question agitated in these references is whether the jurisdiction of the Commissioner of Income -tax to act under Section 263(1) of the Act was ousted by a scheme envisaged by the Central Board of Direct Taxes (hereinafter called "the Board"). A subsidiary question is whether the Tribunal had rightly held that the Commissioner of Income -tax had not followed the rules of natural justice and whether on that score his order was invalid.

(2.) IN 1972, the Board envisaged a scheme to help new taxpayers in the small income group. This was a follow -up of a programme of mass communication. IN terms of this scheme, no penalty under Section 271 or Section 273 was to be levied in the case of a person, who had not been assessed, if the return of income was filed voluntarily prior to January 1, 1973, and the income as declared or as assessed did not exceed Rs. 15,000. An order under Section 119(2)(a) of the Act had been issued by the Board authorising the INcome -tax Officer not to initiate penalty proceedings under Section 271 or Section 273 of the Act. IN terms of this scheme, the INcome -tax Officers were required to visit specially selected areas to assist new taxpayers to fill in the returns of income and, as far as possible, to complete the assessments on the spot. The areas were to be selected by the Commissioner of INcome -tax. Two INcome -tax Officers were to be deputed for the purpose for one area. Full complement of the staff was to accompany the INcome -tax Officers so that all formalities relating to assessment may be completed on the spot. Crossed cheques were acceptable towards the payment of the tax liability. Paragraph 4 of the Scheme read as follows :

(3.) THE order of the Income -tax Officer is an one -line order. From the order, it is difficult to gauge the stand of the assessee before him. If the report of the Inspector of Income -tax is of any indication, her case before the Income -tax Officer was that the income was earned by her by pawn broking business and by purchase and sale of oil seeds. Before the Commissioner, two affidavits were filed on behalf of the assessee, One was filed by Manu Lal Prasad (annexure B) and the other by Dewraj Agrawal (annexure C). THE affidavits were shown on December 9, 1974. THE three paragraphs in the affidavit of Manu Lal Prasad read as follows :