COMMISSIONER OF INCOME TAX Vs. ZAFRUL HASSAN IRAGI

JUDGEMENT

(1.) HOARD learned counsel for the parties.

(2.) THIS is an application under Section 256(2) of the Income-tax Act, 1961. It relates to the assessment for the assessment year 1987-88. In the assessment made on March 20, 1990, certain additions were made in the income of the assessee without affording an opportunity of hearing to the asses-see. On appeal, the Appellate Assistant Commissioner set aside the said additions made without affording an opportunity of hearing to the asses-see and remanded the case back to the Income-tax Officer for deciding the case of additions so set aside after affording an opportunity of hearing to the assessee. Aggrieved by that order the assessee preferred an appeal before the Income-tax Appellate Tribunal. The Appellate Tribunal held that the additions made without affording an opportunity of hearing, being in contravention of the specific requirement of the provisions of the statute that before making any addition in the income returned by the assessee, the assessee has to be given an opportunity of hearing, renders the order void ab initio and nullity which could not be cured and has only to be quashed and could not be made the subject-matter of remand. Therefore, it allowed the appeal of the assessee, the additions made by the Income-tax Officer were set at naught.

(3.) IN this connection, it will be apposite to note that learned counsel for the Revenue relied on the decision of the Supreme Court in Kapurchand Shrimal v. CIT (1981] 131 ITR 451, wherein the Supreme Court has held that where a claim of partition in the Hindu undivided family is made in time and the assessment is made on the Hindu undivided family without holding an enquiry as contemplated by Section 25A(1), the assessment is liable to be set aside in appeal as it is in clear violation of the procedure prescribed for that purpose. The Supreme Court further went on to state that when the Tribunal holds that such an assessment is liable to be set aside, the duty of the Tribunal does not end with making a declaration that the assessment is illegal. The proper order to be passed in such a case would be to set aside the assessment and to direct the INcome-tax Officer to make a fresh assessment in accordance with the procedure prescribed by law.