Shakuntla Devi vs Deputy Commissioner of Income Tax

N.K. Sodhi, J.—This order will dispose of four Writ Petitions Nos. 17549, 17991, 17992 and 18904 of 1998 arising out of the same order of the Income Tax Appellate Tribunal in which common questions of law and fact are involved. Since arguments were addressed in Civil Writ Petition No. 17549 of 1998, the facts are being taken from this case.

By order dated March 27, 1990, the Assistant Commissioner of Income Tax, Karnal, framed an assessment u/s 143(3) of the Income Tax Act, 1961 (for short "the Act"), for the assessment year 1987-88 on a total income of Rs. 17,58,830 against the returned income of Rs. 26,200. Feeling aggrieved by this order, the petitioner filed an appeal before the Commissioner of Income Tax (Appeals) who partly allowed the same. Still not satisfied, she went up in appeal before the Income Tax Appellate Tribunal, New Delhi. The Department also felt aggrieved by the appellate order and preferred an appeal before the Tribunal. Both the appeals were disposed of together by order passed on September 11, 1996. One of the grounds on which the Department felt aggrieved by the appellate order was the deletion of Rs. 15,11,287 by the appellate authority. The Tribunal disposed of this issue in para. No. 8 of its order and observed as under :

"As regards the second contention relating to the deletion of an addition of Rs. 15,11,287 we find that the addition has been made on the basis of a document, namely, seizure memo 18-R, found in the premises of Shri Om Parkash. A similar issue arose in the case of Shri Prakash Chand where on the basis of the aforesaid documents an addition was made in his hands. For the reasons given in our order in I.T.A. No, 424/Delhi of 1992, we would remit the matter back to the file of the Assessing Officer with the directions that the matter be adjudicated upon afresh in the light of the decision which may be taken by the Settlement Commission on the application filed by Shri Om Parkash owning up the aforesaid amount."

This order has become final as neither party has approached this court in appeal or by way of reference.

In pursuance of the order of remand passed by the Tribunal, the Assessing Officer has by notice dated October 15, 1998, called upon the petitioner to appear before him and to produce the documents, account books and other evidence in support of the return filed by her. It is against this notice that the present petition has been filed under Article 226 of the Constitution.

In the reply filed by the Department, it is pleaded that the petitioner has challenged the notice and since no order prejudicial to her interest has been passed, the petition, according to the respondent, is not maintain- able. On the merits, it is averred that since proceedings before the Settlement Commission had not been completed, a fresh assessment had to be made on or before March 31, 1999, and, therefore, the Assessing Officer was justified in issuing the impugned notice.

We have heard counsel for the parties.

A plain reading of the order of the Tribunal shows that the assessment order had not been set aside in its entirety and that only one issue regarding the addition of Rs. 15,11,287 had been remanded to the Assessing Officer to be decided in the light of the decision taken by the Settlement Commission in the case of Om Parkash. We are informed that Om Parkash has already declared the disputed amount of Rs. 15,11,287 before the Settlement Commission as his income and has paid tax thereon. The case before the Settlement Commission has not been decided so far because the said Commission is not presently constituted. Since the tax on the disputed amount has already been deposited by Om Parkash, we are of the view that no prejudice would be caused to the Revenue if the Assessing Officer is directed not to proceed further in the matter till the matter is decided by the Settlement Commission in the case of Om Parkash. We, therefore, allow the writ petition and restrain the Assessing Officer from proceeding further till the dispute is decided by the Settlement Commission in the case of Om Parkash. Counsel for the parties informed us that some Benches of the Settlement Commission are functioning at different places and they have no objection if the case is transferred to any other Bench of the Commission. The competent authority may consider the desirability of transferring the case to some other Bench for early disposal of the case if the Bench at Delhi is not likely to be constituted in the near future.

Before concluding, we may clarify that as and when the Assessing Officer passes a fresh order in accordance with the decision of the Settlement Commission in the case of Om Parkash, the assessee herein (petitioner) will not be allowed to raise the plea of limitation because the proceedings are being stayed on her request.

The writ petition stands allowed in the above terms with no order as to costs.