Decided on March 15,1994



R.P.Garg, - (1.) THIS is an appeal by the Revenue against the order of the Deputy Commissioner (Appeals) for assessment year 1983-84. The only dispute raised in this appeal is that the DC (Appeals) erred in cancelling the assessment and in holding that the proceedings initiated under Section 147(a) were not proper as the assessee had no obligation to file return of income under Section 139(1 A) of the IT Act.
(2.) In the previous year relevant to assessment year 1983-84, the assessee was a Minister of Andhra Pradesh. He returned an income of Rs. 13,500 being the gross amount of salary from the Government of A.P. amounting to Rs. 28,500 as reduced by conveyance allowance and motor car allowance amounting to Rs. 15,000 which were exempt under Section 10(14). It came to the notice of the Income-tax Officer that the assessee enjoyed certain perquisites which were not included in the return filed by him. He, therefore, issued a notice under Section 148 to the assessee requiring him to furnish his return of income. No return was filed in pursuance of the aforesaid notice. The ITO, therefore, completed the assessment ex parte determining the total income of the assessee at Rs. 81,962. The proceedings under Section 147 were challenged by the assessee before the DC (Appeals) and the DC (Appeals), following the decision of his predecessor in the case of Sri P. Ranga Reddy, also an ex-Minister of Andhra Pradesh, wherein it was held that the ex-Minister, whose salary excluding perquisites was only Rs. 13,500, was under no obligation to file return of income in view of the provisions of Section 139(1A) of the Act, held that the proceedings under Section 147(a) were not proper and cancelled the assessment made against the assessee. The Revenue is in appeal.
(3.) THERE was no challenge of the assessment at Rs. 81,962 on merits of the case. In these circumstances, it is not understandable as to how it could be a case where the assessee could be said to be under no obligation to file the return of income under Section 139(1 A) of the Act. It is not the income in the opinion of the assessee which is taxable but the income which is assessable under the I.T. Act which is decisive of the fact whether the assessee is under an obligation to file the return under Section 139(1A). The income determined by the ITO stands at Rs. 81,962 and it is not disputed. In my opinion, therefore, the order of the DC (Appeals) cancelling the assessment on the ground that the assessee was under no obligation to file return of income under Section 139(1A), is not in accordance with law. His order, therefore, requires to be reversed.;

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.