Per Shri H. S. Ahluwalia, Judicial Member - An interesting issue is involved in this appeal. The assessee filed a return declaring a total income at minus figures of Rs. 23,06,230. The ITO, however, computed the total loss of Rs. 16,35,954. Accordingly, he forwarded a draft of the proposed order of the assessment to the assessee on 2-3-1982 under section 144b (1) of the Income-tax Act, 1961 (the Act). The assessee did not file any objections and the assessment was, consequently, finalised as drafted. Thereafter the assessee filed an appeal before the Commissioner (Appeals) who was of the opinion that since the assessee had not filed any objections within the permissible time of 7 days nor did he file any application for extension of time as provided in section 144B (2), the ITO had to complete the assessment on the basis of the draft order. Relying upon a decision of the Nagpur Bench of the Tribunal in the case of Zila Krishi Audyogik Sahakari Sangh Ltd. v. ITO Trigest, Vol. IV, p. 129, he held that the assessee could not be said to be file an aggrieved by the assessment order and, hence, it forfeited its right to file an appeal under section 246 of the Act. The assessee has come up in second appeal before us.
2. We have heard the representatives of the parties at length in this appeal. The representatives of the parties drew our attention to a decision of the Special Bench of the Tribunal at Bombay in the case of ITO v. Sippy Films  ITD 1031, wherein it was held that silence cannot be construed as positive acceptance and by merely not filing objections to the draft assessment order, it could not be said that the assessee should be deemed to have accepted assessment. Therefore, the appeal filed by the assessee before the Commissioner (Appeals) was maintainable. The representative of the department was not in a position to produce any contrary judgment of the Tribunal even the one relied upon by the Commissioner (Appeals) but referred to the judgment of the Madhya Pradesh High Court in CIT v. Gupta & Sons (P.) Ltd.  146 ITR 506. In this case the question in dispute was whether the ITO had the power to condone the delay in making an application under section 146 of the Act because there was no specific provision in the Act and the High Court was the view that he had no such power and if an application was not filed within the time, the same had to be dismissed. According to the departmental representative the assessee was bound to file objections to the draft assessment order within the time prescribed by section 144B and had failed to do so. If now its objections are considered in appeal, it would be indirectly extending the limitation for these objections which the assessee has already lost. To our mind there is difference between the two proceedings. Even if the assessee had filed objections, and they had been rejected by the IAC, the assessee was entitled to file in appeal against the ultimate assessed income. In other words, the right of appeal is entirely different from the right to take objections under section 144B and in any case when there is a direct decision of the Tribunal on the subject, we are not inclined to take a different view. Accordingly, we accept the appeal, set aside the order of the Commissioner (Appeals) and restore the matter to his file for fresh decision on the merits of the case filed before him.