Commissioner of Income Tax vs Smt. Bibi Zaibunnisa

This is a reference u/s 256(2) of the Income Tax Act, 1961 (hereinafter to be referred to as "the Act"), which relates to the assessment year 1972-73. The questions referred to us for our opinion are as follows :

"1. Whether, on the facts and in the circumstances of the case, the Tribunal has rightly held that the Commissioner of Income Tax acting u/s 263(1) of the Income Tax Act, 1901, could not interfere with an order of assessment made u/s 1-13(1) in pursuance of the ''scheme to help the new taxpayers under the small income group'' launched by the Government ?

Whether, on the facts and in the circumstances of the case, the Tribunal has rightly cancelled the order passed by the Commissioner of Income Tax u/s 263(1) of the Income Tax Act, 1961, For the assessment year 1972-73 ?"

The assessee was assessed in terms of a scheme brought out by the Central Board of Direct Taxes. The scheme launched by the Government was meant to help new taxpayers under the small income group. In regard to ladies and minors, however, it had been directed in the scheme that the assessment was to be made in terms of Section 143 of the Act. The assessee was assessed in a summary manner by the Income Tax Officer in terms of the scheme. Later, the Commissioner of Income Tax cancelled the assessment order in terms of Section 263(1) of the Act. The assessee moved the Income Tax Appellate Tribunal against the cancellation order passed by the Commissioner of Income Tax. The Tribunal set aside the order of the Commissioner holding that the Commissioner had no jurisdiction to act in terms of Section 263(1) of the Act on the facts and in the circumstances of that case. Similar questions fell for consideration before us in several references. The law laid down by this court in this behalf is to be found in the case of Commissioner of Income Tax Vs. Pushpa Devi, , Commissioner of Income Tax Vs. Smt. Rambha Devi, and Commissioner of Income Tax Vs. Smt. Pushpa Devi, . In circumstances similar to those of the present case, we have held that the Commissioner Income Tax was fully justified in acting in terms of Section 263(1) of the Act. The present case also stands on the same footing.

We, therefore, hold, that the Tribunal was not right in holding that the Commissioner of Income Tax, acting u/s 263(1) of the Act, could not interfere in the matter of assessment passed by the Income Tax Officer. In that view of the matter, both the questions referred to us are answered in the negative, in favour of the Revenue and against the assessee, and the reference is answered accordingly. However, there will be no order as to costs.

Let a copy of this order be transmitted to the Assistant Registrar, Income Tax Appellate Tribunal, Patna, in terms of Section 260 of the Act.