- (1.) Heard Sri Dhananjai Awasthi, learned counsel for the appellant and Sri Mukesh Jain, alongwith Sri R.S. Agrawal, learned counsel appearing on behalf of the respondent.
(2.) This Appeal, under Section 260-A of the Income Tax Act, relating to the assessment year 1988-89 and 1989-90, arises from the order of the Tribunal, dated 19th May, 1990, which raises following substantial questions of law: i)Whether the Tribunal was justified in upholding the order of CIT(A) who directed the Assessing Officer to frame a single assessment for the entire period from 1.1.87 to 31.3.89? ii)Whether the Tribunal was justified on the facts of the case in upholding the order of CIT(A), who observed the order, passed u/s 3(4) of I.T. Act, 1961 on 7.12.1987, remained legally valid and did not become nonest as a result of the amendment introduced in section 3 of the I.T. Act, 1961 by the Taxation Laws (Amendment) Act, 1987, despite the fact that, in terms of the said order u/s 3(4) the assessee would not have any previous year relevant to A.Y. 1988-89, a situation which is incongruous with the amended provisions of Section 3(2) of the I.T. Act, 1961?
(3.) The brief facts, giving rise to the present Appeal, are that the respondent-assessee, (hereinafter referred to as the 'assessee') is a Company, incorporated under the Indian Companies Act, 1956, which is engaged in the business of running the Distillery and Fertilizer etc., filed the return, for the assessment year 1989-90, declaring a loss of Rs.7,87,68,821. The return was filed for the period 1.1.1987 to 31st March, 1989, that is, for 27 months.;