Delhi High Court
Ram Singh Uppal vs Commissioner Of Income Tax on 21 May, 1984
Author: D Kapur
Bench: D Kapur, D Wadhwa
JUDGMENT
D.K. Kapur, J.
1. The petitioner filed ITC 85/80 u/s 256(2) of the IT Act relating to the asst. yrs. 1941-42 to 1945-46, i.e. five assessment years in all. The application was directed against the rejection of the applicant's five applications u/s 256(1) of the Act relating to these five years. A preliminary objection was taken regarding the maintainability of one application for five assessment years on the basis of our judgment in Nawal Bihari Lal Goel v. CIT (1983) 140 ITR 979 (Del). In that case also, in relation to four assessment years, one application had been filed and we had held that it could not be described as an error which could be condoned by permitting three additional applications being filed. We are of the view that the same position would hold true in the present case except for the fact that there is an exceptional circumstance, which has been brought to our notice by the ld. counsel. Four new applications have been filed u/s 256(2) along with the applications for condoning the delay. We will now deal with the question whether the delay should be condoned especially in the circumstances of this case.
2. The facts of the case are that while dealing with the assessment of the petitioner for subsequent years. The ITO came to the conclusion that income for several previous years had escaped assessment and accordingly the ITO got permission from the CBR u/s 34(1)(a) to reopen the case. The proviso to that provision fixes eight years as the limit for reopening the case u/s 34(1)(a), but provides that in case the amount which has escaped assessment amounts to more that Rs. 1 lakh in aggregate for a certain period, then the case can be reopened in spite of the limitation period having expired provided the CBR gives permission. Acting under this proviso, the ITO got permission to reopen the case for asst. yrs. 1941-42 to 1945-46, i.e. five years on the ground that the income that has escaped assessment for this period was more than Rs. 1 lakh. This is how the limitation period of eight years was overcome and the assessment was reopened by a notice served on 1-12-1961. Learned counsel submits that if five years are not clubbed together, then reopening cannot be done in any of the years and, therefore, it was thought that only one application had to be moved because all the five years had been clubbed together. Keeping in view that this is an exceptional circumstance, we would condone the delay in the filing of the four additional applications, as treating the application for only one of the years as being within time might lead to contradictory orders being passed. The five years were treated as one composite period by the IT Department and, therefore, the orders in this case on merits must also be in relation to all the five years.
(The Civil Misc. applications praying for condoning the delay are thus disposed of).
3. Having condoned the delay, it now remains to dealt with the application on merits. We have been taken throught the orders of the ITO, the AAC and the Tribunal, both in regard to merits as well as on the question of applicability of s. 34(1)(a) and its proviso (Act of 1922). We find that question of law do arise, especially question No. 1, as stated in the five petitions. There are three other questions raised. We do not think that question Nos. 2 is a question of law, Even question Nos. 3 and 4 do not appear to be question of law, but the ld. counsel has subitted on question No. 3 that the amount of Rs. 15,000 was excluded in the asst. yr. 1946-47 and so it could not be included in an earlier period. He wants to refer to the assessment year in question. As far as question No. 4 is concerned, he submits that it is covered by an authority of the Supreme Court.
4. We would accordingly direct the Tribunal to state a case and refer the same to this court on the following three questions :
"1. Whether, on the facts and in the circumstances of the case, the tribunal was right in holding that the provision of s. 34(1)(a) of the Act of 1922 were rightly invoked ?
2. Whether, on the facts and in the circumstances of the case, the ld. Tribunal was correct in including Rs. 65,000 in the total assets of the assessed as deposits in M/s Ram Singh & Sons when the availability of the said amount was admitted by the department in the asse. yr. 1946-47 ?
3. Whether, on the facts and in the circumstances of the case, the inclusion of the value of assets in the name of the assessed's wife and children was rightly made in the total assets for the purpose of charging the same to tax ?"
5. The same questions are to be referred in all the five assessment years.
6. The parties will bear their own costs.
