B V VENKATESAM CHETTY Vs. COMMISSIONER OF INCOME TAX ANDHRA PRADESH HYDERABAD

JUDGEMENT

(1.) B.V. Venkatesam Chetty submitted a return for the assessment year 1970-71 under the I.T. Act, 1961. His assessment was finalised on 13/01/1971. The order was reopened later, for, in the return, Rs. 3,600, being dividend received by him from M/s. Aruna Roller Flour Mills Private Limited, Mandapaka, was not shown by him. Therefore, the ITO, under s. 148 of the Act, reopened the assessment and included the amount and taxed it. Venkatesam Chetty protested against the order. On appeal, the Commissioner of Income-tax, on 29/04/1976, confirmed the order and directed the ITO to suitably modify the assessment for 1971-72. Aggrieved thereby, Venkatesam Chetty has approached this court to quash all proceedings by which the assessment completed on 13/01/1971, was reopened.

(2.) It is argued, Venkatesam Chetty maintains account books under cash system, that he received on 11/05/1970, the dividend cheque and, therefore, he could not have shown Rs. 3,600 in the return for the assessment year 1970-71; consequently, he could not be assessed. This writ petition is resisted by the Revenue on the ground that Aruna Flour Mills declared the dividend on 28/03/1970, that therefore, from the stand point of "declaration of dividend", the inclusion of the amount is proper.

(3.) The question raised is no more res integra. It is covered by, at least, three cases of the Supreme Court. In the first case, in Dalmia v. CIT [1964] 53 ITR 83 (SC), the distinction between "interim dividend" and "dividend" was elucidated. That distinction is not relevant in the instant case as Rs. 3,600 dividend is not an interim dividend which can be rescinded before payment was made. In that case, it was held that