M M MUTHUWAPPA Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE assessee carries on business in Ceylon. For the assessment year 1950-51, a notice under Section 22 (2) was served on him on 21st June, 1950. No return was furnished. A further notice under Section 22(4) was served on 18th January, 1951. THE assessee applied for time to comply with the notice. Though the assessee's auditors promised to file a return before the end of January, there was no compliance with either of the notices issued by the Department. Accordingly, the Income-tax Officer proceeded to make an assessment under Section 23(4), that is a best of judgment assessment.

(2.) THE assessee took the matter up in appeal to the Appellate Assistant Commissioner. He objected to the quantum of the assessment. He also raised the plea that during the relevant accounting period, he was resident but not ordinarily resident, and that the assessment made on him on the basis of a resident and ordinarily resident was wrong. THE Appellate Assistant Commissioner made an order under Section 31(2) of the Act directing the Income-tax Officer to make a further enquiry with regard to the residence of the assessee and directed him further to re-compute the income after examination of the evidence and accounts to be produced by the assessee. Apparently, even at the stage when, the Appellate Assistant Commissioner made this order, the Income-tax Officer objected to the letting in of fresh evidence at that stage, but that objection was overruled by the Appellate Assistant Commissioner. In due course, the Income-tax Officer made his remand report. THE appeal came to be heard by another Appellate Assistant Commissioner before whom the assessee again pressed the grounds taken by him, one relating to his liability to assessment as resident and ordinarily resident, and the other, the quantum of the assessment. THE Appellate Assistant Commissioner examined the merits of these contentions and found against the assessee on the question of residence. With regard to the quantum, as against the total income of Rs. 88,000 estimated by the Income-tax Officer, the Appellate Assistant Commissioner fixed the amount at Rs. 77,546.

(3.) IN Naba Kumar Singh Dudhuria V. Commissioner Of INcome-Tax, AIR 1945 Cal 104 it was pointed out by the Calcutta High Court, while dealing with the claim of the assessee that he had two independent rights of appeal, that there is an inherent limitation with regard to the scope of appeal from an order under Section 27. The learned Judges say: