FUEL SUPPLY CO Vs. COMMISSIONER OF INCOME TAX
LAWS(CAL)-1963-12-5
HIGH COURT OF CALCUTTA
Decided on December 06,1963

FUEL SUPPLY CO Appellant
VERSUS
COMMISSIONER OF INCOME TAX Respondents





Cited Judgements :-

COMMISSIONER OF INCOME TAX VS. RUPA TRADERS [LAWS(CAL)-1979-1-12] [REFERRED TO]
COMMISSIONER OF INCOME TAX VS. MAHABIR FANCY STORE [LAWS(ORI)-1993-2-31] [REFERRED TO]
ANSARI JEWELLERS VS. COMMISSIONER OF INCOME TAX [LAWS(RAJ)-1986-9-48] [REFERRED TO]


JUDGEMENT

K.C.Sen, J. - (1.)This is a reference under Section 66(2) of the Income-tax Act, 1922 hereinafter described as the Act. The following question of law has been referred to this Court for its opinion:
"Can an appeal under Section 30 of the Indian Income Tax Act against the claim of the best judgment assessment also combine an appeal against the refusal of registration when the assessment and the refusal are made in the same order under Section 23(4) of the Income Tax Act?"
The assessee Messrs. Fuel Supply Company is a partnership firm carrying on a business in colliery materials tools and other things. The assessment year in question is 1956-57 and the corresponding accounting year is the Diwali year 2011/12. This partnership firm was registered under Section 26A of the Income-tax Act ever since the assessment year 1946-47. A notice under Section 22(2) of the Act was served on the assessee on the 26th July 1956. There was no compliance with the notice by the assessee till the 16th September 1957. Thereafter a notice under Section 22(4) was also served upon the assessee to produce the books of accounts on the 10th September 1957 and the date of hearing before the Income-tax Officer was fixed on the 13th September, 1957. This notice was not also complied with. Accordingly, the Income-tax Officer completed the assessment under Section 23(4) on the 16th September 1957 to the best of his judgment and in the same order renewal of registration of the 'firm was refused. The assessee appealed to the Appellate Assistant Commissioner and its original grounds of appeal were confined only to the quantum of assessment and to the propriety of assessment under Section 23 (4). An additional ground was allowed to be raised by the Appellate Assistant Commissioner regarding the order of refusal of registration. It runs as follows:
"For that the learned Income Tax Officer was wrong in cancelling the registration of the firm and assessing the firm in the status of unregistered firm without giving the assessee any opportunity of being heard as laid down in the proviso to Section 23 (4) of the Income Tax Act."

(2.)It will appear from the statement of the case, in which the order of the Appellate Assistant Commissioner has been quoted, that the quantum appeal was dismissed by the Appellate Assistant Commissioner, but in the same order it was found that even though the application for renewal of registration was submitted long before the assessment order was passed, there was no specific order under Section 26-A, Accordingly, it was directed that the Income-tax Officer should consider the application under Section 26-A in accordance with law, which was submitted before the Income Tax Officer on the 29th June 1956.
(3.)The department was aggrieved by the decision and in the appeal before the Appellate Tribunal, it was contended that the appellate Assistant Commissioner erred in assuming jurisdiction for going into the question whether the Income Tax Officer was right or wrong in not disposing of the application under Section 26A, while hearing an appeal against an assessment made under Section 23(4) of the Act. Before the Tribunal it was contended on behalf of the assessee that when an appeal was taken against the best judgment assessment made under Section 23(4), the assessee had a right to agitate against the order of refusal of registration passed in the same order under Section 23 (4) The Tribunal after hearing the parties came to the conclusion that the quantum and registration appeals are two different matters and if the assessee wanted to agitate against the order of refusal of registration he ought to have filed am appeal in Form No. DII and could not agitate it in the quantum appeal. Furthermore, it was observed that in the appeal to the Appellate Assistant Commissioner the assessee had nowhere asked for relief under Section 26A and, therefore, the Appellate Assistant Commissioner acted without jurisdiction in taking upon himself the power to grant the assessee a relief which was not asked for. In terms of the Tribunal's order, it appears that although a composite order was passed by the Income Tax Officer, it was the bounden duty, under the statutory provision, on the part of the assessee to file two separate appeals viz., (i) Quantum appeal in the Form No. B and (2) Refusal of registration appeal in Form No. DII.


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