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Mrs. Banoo E. Cowasji Vs. Commissioner of Income-tax - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtMadhya Pradesh High Court
Decided On
Case NumberMiscellaneous Civil Case No. 90 of 1980
Judge
Reported in[1982]138ITR686(MP)
ActsIncome Tax Act, 1961 - Sections 256(1)
AppellantMrs. Banoo E. Cowasji
RespondentCommissioner of Income-tax
Appellant AdvocateG.M. Chapekar, Adv.
Respondent AdvocateR.C. Mukati, Adv.
Excerpt:
.....it cannot be said that onus shifts exclusively and heavily on him to prove his innocence. conviction of appellant is liable to be set aside. - the tribunal took the view that so far as the assessments made in the case of the assessee were concerned, they were perfectly valid......of the fact that for these years, the ito had already assessed that income in the hands of the deceased, cowasji. the commissioner (appeals) held that the assessments made in the case of the assessee were quite valid but the assessments made in the case of the deceased, cowasji, were void ab initio and manifestly illegal. he, therefore, directed the ito to treat the assessments made in the bands of late shri cowasji as having been made on a protective basis, and, further, directed him to cancel the same and refund the taxes to the concerned taxpayers. aggrieved by the order of the commissioner (appeals), the department preferred appeals before the tribunal. the tribunal took the view that so far as the assessments made in the case of the assessee were concerned, they were perfectly.....
Judgment:

Sohani, J.

1. By this reference under Section 256(1) of the I.T. Act, 1961 (hereinafter referred to as 'the Act'), the Income-tax Appellate Tribunal, Indore Bench, has referred the following questions of law to this court for its opinion :

' (1) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the CIT (A) was not competent to issue directions to cancel the assessments made in the case of late E.C. Cowasji and to refund the taxes to the concerned taxpayers, and that to do so was beyond his jurisdiction ?

(2) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in deleting the findings of the CIT (A) that such assessments in the case of late E. C. Cowasji were on protective basis '

2. The material facts giving rise to this reference briefly are as follows :

One E.C. Cowasji died intestate on 23rd December, 1967. The deceased was, however, assessed for the assessment years 1969-70 to 1971-72. His widow, Mr. Banoo E. Cowasji, who was an assessee in the status of an individual, was assessed for the assessment years 1969-70 to 1971-72. The assessments were, however, reopened because the income from the assessee's share in the properties left behind by her deceased husband was not disclosed in the return shown by the assessee. Accordingly, fresh orders of assessment were passed. Aggrieved by these orders, the assessee preferred appeals before the Commissioner of Income-tax (Appeals). The assessee did not dispute the correctness of the assessments made by the ITO in the case of the assessee. It was, however, contended on behalf of the assessee that the ITO was not competent to include the income derived by the assessee from her share in the estate of the deceased in the total income of the assessee, in view of the fact that for these years, the ITO had already assessed that income in the hands of the deceased, Cowasji. The Commissioner (Appeals) held that the assessments made in the case of the assessee were quite valid but the assessments made in the case of the deceased, Cowasji, were void ab initio and manifestly illegal. He, therefore, directed the ITO to treat the assessments made in the bands of late Shri Cowasji as having been made on a protective basis, and, further, directed him to cancel the same and refund the taxes to the concerned taxpayers. Aggrieved by the order of the Commissioner (Appeals), the Department preferred appeals before the Tribunal. The Tribunal took the view that so far as the assessments made in the case of the assessee were concerned, they were perfectly valid. The Tribunal further observed that the assessments made in the case of the deceased, Cowasji, after his death were invalid in the eyes of law but the Commissioner (Appeals) was not competent to issue a direction regarding the assessments of the deceased, Shri E.C. Cowasji, while deciding the appeals in the case of the assessee, Mrs. Banoo E. Cowasji. In this view of the matter, the Tribunal modified the order passed by the Commissioner (Appeals) and deleted the following direction in his order: 'under the circumstances, the ITO is directed to treat these assessments as having been made on protective basis. He is further directed to cancel the same and refund the taxes to the concerned taxpayers.' Aggrieved by the order passed by the Tribunal, the assessee submitted an application for making a reference and it is at the instance of the assessee that the aforesaid questions of law have been referred to this court for its opinion.

3. Learned counsel for the assessee was unable to point out any provision of law under which the Commissioner (Appeals) could, while deciding an appeal preferred by the assessee, pass orders with regard to the assessments made by the ITO in the case of her deceased husband. The question for consideration before the Commissioner (Appeals) was whether the ITO was justified in reopening the assessments of the assessee by including the income derived by the assessee from her share in the estate of her deceased husband, E.C. Cowasji, in her total income. Under these circumstances, the Tribunal, in our opinion, was right in holding that the Commissioner (Appeals) was not competent to issue directions to cancel the assessments made in the case of the deceased, Cowasji, and to refund the taxes to the concerned taxpayers. In this view of the matter, the Tribunal was right in modifying the order passed by the Commissioner (Appeals) as aforesaid.

4. For all these reasons, our answer to the questions referred to us are in the affirmative and against the assessee. In the circumstances of the case, parties shall bear their own costs of this reference.

5. Reference answered accordingly.


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