S.K. Desai, J.
1. Prayer (a), in this petition is for a writ in the nature of mandamus directing the 1st respondent to the petition, who is the ITO, Companies Circle VI (5) (or his successor), to consider the petitioner's application for rectification of certain proceedings. A few facts may be stated :
There were various pending assessment proceedings and as a result of various factors, which need not be set out, there was a settlement between the assessee (the petitioner) and the department for the two relevant assessment years, viz, assessment years 1958-59 and 1959-60, the corresponding accounting years for these two years are the years ending 31st March, 1958, and 31st March, 1959, respectively. These assessments were completed on 31st January, 1961, on a total income of Rs. 4,12,987 and Rs, 4,69,809, respectively. Thereafter, on 6th January, 1964, the petitioner made an application for rectification of their assessment for the two years, contending, inter alia, that the addition of 1,25,294 and Rs. 11,729 for the two assessment years was not justified for the reasons indicated in the letter and that the assessments were required to be rectified and credit given to the company in respect of the excess tax demand. A copy of this application is annexed as Ex. C to the petition. The annexure to the application shows, according to the petitioner, how what they had contended can be substantiated. It appears that thereafter certain queries were made by the ITO and several letters were addressed by the petitioner referring to the discussion held and giving explanations as to the points raised by the ITO. According to the petitioner, no final decision was taken by the ITO, presumably because there were many transfers and because of these frequent changes the application of the petitioner for rectification remained unattended. The petitioner, therefore, addressed a letter dated 3rd November, 1970, to the Commissioner, Bombay City II, drawing his attention to the said state of affairs. Bu the letter, the Commissioner was requested to issue necessary instructions to the ITO who was then assessing the petitioner-company's case to pass an order on the application for rectification. A copy of this application is annexed as part of Ex. E (collectively) to the petition. The letter does not appear to have been properly considered by the Commissioner, since instead of directing the ITO to pass appropriate orders on the application for rectification, the Commissioner informed the director of the petitioner-company that the assessments under reference could not be rectified, and the reason given was that the income returned for these assessments had been accepted under s. 23 (1) of the Indian I. T. Act, 1922. Further correspondence was carried on with the Commissioner in which he was invited to reconsider his decision. But this request was not acceded to. The petitioner also addressed a letter to the CBDT and the Board also declined to interefere in the matter. The petitioner then also addressed a letter to Finance Minister, but Government refused to interevene.
2. Mr. Vyas, on behalf of the petitioner, has submitted that irrespective of the merits of the application for rectification the ITO was required to pass oan order thereon, which would be order on the merits of the same and it was not proper for the Commissioner to usurp the functions of the ITO. According to him, if an appropriate order ahd been passed, then if the same was adverse to the petitioner, the petitioner would have carried the matter to the higher authorities in the proper manner as provided in the I. T. Act According to Mr. Vyas, what has been done is to short circuit the entire proceedings in the manner not warranted by the provisions of the income-tax law.
3. Without expressing any opinion on the merits of the application for rectification, which appears to me to be within the period of four years provided for that purpose, I think there is considerable substance in Mr. Vyas' contention. It is true that there is great delay of nearly seven years in coming to the High Court. But the petitioner himself has given reason for this delay, viz., that the ITOs were being frequently transfered and, therefore could not take a decision. The petitioner cannot be held responsible for this delay. After the Commissioner gave his decision, it is true that the petitioner asked the Commissioner to reconsider the decision, which he did not do. But that does not imply that the petitioner accepted the Commissioner's competence to give a decision on the application for rectification which the ITO alone was empowered to do.
4. I think an order must be made in terms of prayer (a) of the petition and the ITO must be directed in terms of prayer (a) with a further direction that he will pass proper orders on the application for rectification ignoring the decision of the Commissioner and the further letters of the CBDT and of the Govt. of India, which must not influence his determnation. This order must not be taken to mean that either there is substance in the application for rectification or there is not. The ITO will pass his order on the application for rectification on merits after considering the application and the applicable legal provisions.
5. Accordingly, the rule is made absolute in terms of prayer (a). It is unnecessary to consider prayer (b). Further, in view of the fact that the ITO concerned has been specifically directed under this order to ignore the communications of the Commissioner, the CBDT and the Govt. of India at the time of passing his order on the application for rectification, it becomes unnecessary to give any relief in terms of prayer (c) and no specific order need be made since these communications are to be ignored by the ITO.
6. The parties are directed to bear their own costs fo this miscellaneous petition.
7. It is hoped that the ITO will dispose of the matter expeditiously.