Charanjit Talwar, J.
1. The petitioners, M/s. Delhi Cloth & General Mills Co. Ltd., have challenged the legality of the order dated January 30, 1973, passed by the Commissioner of Income-tax, Delhi, whereby the revision petitions filed by the petitioners were held to be barred by time and the application seeking condensation of delay in filing the revision petitions was dismissed.
2. To appreciate the contention raised by the petitioners, it is necessary to notice a few facts.
3. For the assessment years 1941-42 to 1947-48, the income from property let out to the employees of the petitioners had been assessed under section 9 of the Indian Income-tax Act, 1922 (hereinafter referred to as 'the Act'), under the head 'Income from property'. For the assessment year 1948-49, the petitioners claimed for the first time that the income from those properties let out to its employees should be assessed as business income of the petitioners under section 10 of the Act and not under section 9 of the Act. The plea was not accepted by the Department. However, this contention was accepted by the Punjab High Court. It was held that income from property owned by the petitioners which had been let out to its own employees was chargeable as business profits while the rent received from property let out to outsiders was to be taxed under section 9 of the Act. As a result of this decision, the Excess Profits Tax Officer reopened the excess profits tax assessments for the relevant assessment years namely, 1941-42 to 1946-47. From the record, it is not clear as to when the notices for the reopening of the assessments were issued by that E. P. T. Officer to the petitioners but from the impugned order, it appears that those were issued in the year 1961. Revised assessment orders, however, were passed on August 1, 1967. In all, an amount of Rs. 6,17,505.50 was demanded by way of additional excess profits tax. The petitioners challenged the legality of those orders of the Excess Profits Tax Officer before the Appellate Assistant Commissioner. The Commissioner has noticed in the impugned order that those appeals were decided by the Appellate Assistant Commissioner on October 28, 1968, against the assessed. The petitioners further preferred appeals before the Income-tax Appellate Tribunal which were dismissed on September 10, 1971. It is not necessary for the decision of this petition to go into the merits of those cases or notice the findings of the said Tribunal.
4. It was during the pendency of the appeals filed before the Appellate Assistant Commissioner by the petitioners against the order dated August 1, 1967, that the revision petitions for the assessment years 1941-42 to 1946-47 were filed by them before the Commissioner of Income-tax, Delhi, on May 8, 1968. Those petitions admittedly had been filed long after the time provided for filing revision petitions. By a letter dated February 18, 1972, the petitioners were asked to show cause by February 25, 1972, as to why those petitions be not rejected as having been filed out of time. In their reply, the petitioners submitted that :
'The revision of the income-tax assessments which were completed in the years 1943 to 1946, has become necessary because of the revised excess profits tax assessments done in 1967. It would be appreciated that the revision petitions in question could not have been made within one year of the original income-tax assessments which are sought to be revised. The cause for making the revision petitions arose as a result of the revision of excess profits tax assessments. Hence, there was no occasion for making the revision petitions before the revision of excess profits tax assessments in 1967, which could not have been anticipated. In view of this, our petitions should be accepted and should not be rejected merely on the technical ground that they have not been made within one year from the date of the order sough to be revised. The facts of the case show that the revision of the income-tax assessments is quite justified in view of the revised excess profits tax assessments.'
5. The learned Commissioner of Income-tax, has noticed in his order of January 30, 1973, that excess profits tax assessments were reopened some time in the year 1961 and were revised by orders dated August 1, 1967. It has further been noticed that the assessed, i.e., the petitioners herein, preferred appeals before the Appellate Assistant Commissioner, A-Range, who decided the appeals, vide his order dated October 28, 1968, and thereafter further appeals were filed before the Appellate Tribunal. The said Tribunal dismissed the appeals and the reasons for dismissing those have been also noticed in detail by him. The reasons for not condoning the delay under sub-section (2) of section 33A of the Act, are given in paragraph 6 of the order and read as under :
'Then again, the earliest occasion when the assessed came to know of the possibility of enhancement of the excess profits tax payable by him is the year 1961, when the Excess Profits Tax Officer reopened the already completed assessments. But the assessed waited for another seven years for moving an application under section 33A of the old Act, a period utilised in questioning the very validity of the reopening of the excess profits tax assessments.'
6. It is apparent that the learned Commissioner was of the view that the petitioners ought to have filed the revision petitions as soon as show-cause notices were issued by the Excess Profits Tax Officer in the year 1961. In my view, this finding is preserve. The assessment was revised by the Excess Profits Tax Officer, vide his order dated August 1, 1967. There was no occasion whatsoever for the petitioners to have challenged the said proceedings before they were concluded. The petitioners thereafter filed appeals before the Appellate Assistant Commissioner under the provisions of the Excess Profits Tax Act. Thereafter, further appeals as provided under that Act were filed by them before the Tribunal. The petitioners were well within their rights to exhaust the remedy under the Act. It was open to them to wait till the decision of the Tribunal and thereafter filed revision petitions under section 33A(2) of the Act. The pendency of the proceedings under the Excess Profits Tax Act to the time their appeals were decided by the Tribunal can be considered a sufficient cause which prevented them from making the revision petitions earlier. In the present case, while the appeals were pending, the petitioners moved the said petitions. As noticed above, the Commissioner in his order has referred to those proceedings, i.e., from the stage of the show cause notice under the Excess Profits Tax Act to the final pronouncement by the Tribunal. The reasons stated by him that the petitioners ought to have moved as soon as they came to know in the year 1961 of the possibility of an enhancement of the excess profits tax cannot be upheld as on the respondent's own showing, the revised assessments had not been completed then. In that view of the matter, the impugned order is to be set aside. I order accordingly. While allowing the writ petition, I remand the matter to the Commissioner of Income-tax, Delhi, for deciding afresh the question of condensation of delay in filing the revision petitions for the assessment years 1940-41 to 1946-47. It is open to the petitioners to file before the Commissioner documents and affidavits in support of their plea seeking condensation of delay in filing the revision petitions. This direction has become necessary in view of the submission of counsel for the respondent that the record maintained by the Commissioner's officer has been misplaced. I had asked him to produce it in the court for my perusal but he was unable to do so.
7. The petition is allowed but with no order as to costs.
8. Petition allowed.