- (1.) BY this application under S. 256(2) of the IT Act, 1961, assessee prayed that Tribunal be directed to refer the following questions for the opinion of this Court : (i) Whether in the facts and circumstances of the case the reassessment proceedings under S. 147 (a) of the IT Act, 1961 (IT Act) by the learned ITO and confirmed by the learned Tribunal are valid, wrong, illegal, and without jurisdiction and being violative on law of land as declared in Calcutta Discount Co. vs. ITO (1961) 41 ITR 191 (SC) : TC 51R.779 are violative of Art. 141 of the Constitution of India ? (ii) Whether in facts and in the circumstances of the case, addition of the amount of the remission of customs penalty to the income of the firm Assam Roller Flour Mills by the learned ITO under s. 148 and confirmed by the learned Tribunal is arbitrary, perverse, wrong, illegal incompetent and being in contravention of S. 41(1) and 170(1)(b) of the IT Act and S. 40 of Partnership Act is violative of Art. 265 of the Constitution of India ?
(2.) THE assessment year is 1982-83. The assessee firm continues to derive income from the manufacture and sale of various types of flours. Books of accounts maintained by the assessee were produced by the AO during the course of assessment. The original assessment was made under S. 143(3) on 27th March, 1985. Thereafter, a notice under S. 148 was issued, for reopening of the assessment under S. 147(a) of the IT Act. In the show-cause notice issued under S. 148, it was stated that as why the amount of Rs. 6,50,000 being the amount of remission of penalty, which was received by the assessee during the accounting year should not be taxed under S. 41(1) of the Act, 1961. In the order under S. 143(3) r/w S. 147, the AO has not only taxed the amount of Rs. 6,50,000 which was received from the custom authorities but also disallowed the depreciation of amount of Rs. 85,957 on the building, machinery and plant which were not destroyed in the fire. He also disallowed the investment allowance under S. 32A(5), earlier allowed in the original assessment order on the ground that the machinery and plant were transferred to a newly incorporated company. In the appeal, the CIT(A) has directed to allow Rs. 85,957 on account of depreciation which was earlier allowed but he confirmed the order of the disallowance of investment allowance under S. 32(A)(5) of the Act i.e., disallowance of Rs. 2,15,400 on account of investment allowance which was earlier wrongly allowed. In appeal before the Tribunal, the Tribunal has considered the validity of re-opening of assessment under S. 148 and found that the reopening was valid, considering the fact that the assessee failed to disclose fully and truly all material facts for the assessment. For taxing the amount of Rs. 6,50,000, the Tribunal has again sustained the view taken by the AO holding that the amount of Rs. 6,50,000 was received by the assessee in the accounting year relevant to assessment year that should be taxed in the year under consideration.
(3.) LEARNED counsel for the assessee, Mr. Bhojwani submits that the reopening of the assessment is bad is law as far as he submits that all the relevant material facts necessary for the assessment, assessee has disclosed all material facts fully and truly.;