COMMISSIONER OF INCOME TAX Vs. ALKEENSONS AGENCIES

JUDGEMENT

(1.) BY this reference under Section 256(1) of the Income tax Act, 1961 (the "Act"), the Income-tax Appellate Tribunal, Amritsar Bench, Amritsar (the "Tribunal"), has referred the following two questions of law to this court for opinion at the instance of the Revenue :

(2.) THE material facts of the case, giving rise to this reference, are as follows : the assessee, Alkeensons Agencies, Srinagar, was assessed by the Income-tax Officer, Srinagar, for the assessment year 1973-74 under Section 143(3) of the Income-tax Act, 1961. In the said assessment, the Income-tax Officer made an addition of Rs. 26,508 to the disclosed income of the assessee. THE assessee challenged the above addition before the Appellate Assistant Commissioner of Income-tax. THE Appellate Assistant Commissioner rejected the challenge and sustained the addition on the ground that the assessee itself had agreed to the impugned addition. THE assessee appealed to the Tribunal. Before the Tribunal, the assessee did not argue the merits of the addition but, relying upon the decision of this court in S. Mubarik Shah Naqshbandi v. CIT [1977] 110 ITR 217, raised a fresh legal objection that the assessment order was illegal, inasmuch as, the tax demanded from the assessee was not computed in the assessment order itself. This contention of the assessee was opposed by the Revenue. THE case of the Revenue was that the decision of this court in S. Mubarik Shah Naqshbandi v. CIT [1977] 110 ITR 217, had no application to the facts of the present case because here the tax payable by the assessee had been properly calculated in Form I. T. N. S. 150, which was prepared along with the assessment order and formed part of the same. It was contended that in that view of the matter, it cannot be said that the tax payable was not calculated in the assessment order. THE Tribunal did not accept the contention of the Revenue and held that as tax had not been calculated in the body of the assessment order the decision of this court in S. Mubarik Shah Naqshbandi v. CIT [1977] 110 ITR 217, was applicable and the impugned assessment was invalid. THE Tribunal deleted the additions made by the Income-tax Officer on that count. Aggrieved by the above decision, the Revenue sought reference of the questions of law arising out of the order of the Tribunal to this court under Section 256(1) of the Act. Hence, this reference.

(3.) THE Supreme Court also took note of the practice of calculating the tax payable in Form I.T.N.S. 150 and observed (page 638) :