High Court Of Madras
CIT vs. Sri Mahasastha Pictures
Sections 143(1)(c), 263
N.V. Balasubramanian & K. Raviraja Pandian, JJ.
TC Ref. No. 34 of 1999
13th November, 2002
Counsel Appeared : Mrs. Pushya Sitharaman, for the Applicant : V.S. Jaykumar, for the Respondent
ORDER
N.V. Balasubaramanian, J. :
The only point that arises in the Tax Case is whether the Tribunal was right in holding that the CIT hasjurisdiction to invoke the power under s. 263 of the IT Act (‘the Act’). In this case summary assessment order was made under s. 143(1)(a) of the Act. The CIT exercised the power under s. 263 of the Act. But the Tribunal held that in view of the Circular of the Board No. 176, dt. 26th Aug., 1987, the CIT has no jurisdiction to revise the order passed in summary assessment. We have already taken the view in the order in CIT vs. Smt. R.G. Umaranee (T.C. Nos. 61 and 62 of 1998, dt. 6th Nov., 2002) that the order passed by the ITO in the summary assessment can by revised under s. 263 of the Act, as s. 263 is widely worded to encompass any order passed by the AO including the summary assessment order. We also found that there are no limiting words found in s. 263 of the Act to exclude the exercise of the power of the CIT in the case where the AO has made a summary assessment order. We have already held that the CIT was advised not to invoke the powers of revision only in cases where there is a negligible tax effect. The Tribunal has proceeded only on the basis that the CIT has no jurisdiction to invoke the statutory powers under s. 263 of the Act in cases of order of summary assessment made by the ITO and we hold that the said view of the Tribunal is not legally sustainable. The question of law referred to us reads as under :
“Whether, the Tribunal was justified in cancelling the order passed by the CIT under s. 263 of the IT Act, 1961 in view of the Circular No. 176, dt. 26th Aug., 1987, of the CBDT?”
2. Accordingly, we answer the question in the negative in favour of the Revenue and against the assessee. The result is the Tribunal has to go into the question of merits of the case and decide the question as regards the merits of the claim of the assessee. The question is answered accordingly. However, in the circumstances, there will be no order as to costs.
[Citation : 263 ITR 304]
