Bombay High Court
Saiko Matek Engineering Private ... vs D.C. Pant, Deputy Commissioner Of ... on 26 August, 1992
Equivalent citations: [1993]204ITR839(BOM)
Author: Sujata Manohar
Bench: B.N. Srikrishna, Sujata V. Manohar
JUDGMENT Mrs. Sujata Manohar, J.
1. This writ petition pertains to the assessment year 1990-91, the relevant accounting year being April 1, 1989 to March 31, 1990. The petitioner-company filed a return for the assessment year 1990-91 with the respondents on November 12, 1990, showing assessable income at Rs. 50,049 against which unabsorbed business loss of Rs. 50,049 was adjusted, resulting in nil income. The respondents, however, sent an intimation dated December 2, 1990, under section 143(1)(a) of the Income-tax Act, 1961, calling upon the petitioner-company to pay a sum of Rs. 1,89,480 by computing the taxable income at Rs. 2,25,269. The petitioners filed an application under section 154 of the Income-tax Act, 1961, for correction of several errors apparent on the face of the order. Thereafter, in the rectification application which was filed by the petitioners under section 154 of the Income-tax Act, 1961, the Deputy Commissioner of Income-tax, by his order dated February 22, 1991, partly rectified the quantum of income arrived at in the intimation and reduced it to Rs. 1,64,772. The petitioners were called upon to pay additional tax on the amount of Rs. 1,64,772.
2. After the filing of this petition, the Deputy Commissioner of Income-tax has passed a further order of rectification dated March 21, 1991, under section 154 of the Income-tax Act, 1961. This order has been annexed as exhibit 'I' by way of an amendment to the petition. As per this order, the contentions of the petitioners have been accepted and the assessable income for the assessment year 1990-91 has been considered as nil. The order under section 154, however, goes on to state that additional tax will be charged only on an amount of Rs. 1,64,772. Hence the petitioners have challenged this order by the present writ petition.
3. We have only to consider now the order of March 21, 1991. It is difficult to understand, how, after arriving at the conclusion that the assessable income of the assessee-company for the assessment year 1990-91 is nil, the assessee-company has been called upon to pay additional tax on Rs. 1,64,772. As per the second rectification order, on adjustment of carried-forward losses, the income of the petitioners becomes nil. There can, therefore, be no question of paying any additional tax. This part of the order is, on the fact of it, erroneous and Dr. Balasubramanian has very fairly stated that it is difficult to justify this part of the order. The petitioners have not paid so far any additional tax as per the impugned order of March 21, 1991. Therefore, the question of granting any refund does not arise at this stage. Even otherwise, under section 143(1A)(b) where, as a result of an order, inter alia, under section 154 the amount on which additional income-tax is payable has been increased or reduced, as the case may be, the additional income-tax shall be increased or reduced accordingly, and in the case of reduction, the excess amount, if paid, shall be refunded. There is no question, therefore, of the petitioners being liable to pay any additional income-tax. In the circumstances of this case, the impugned order in so far it levies additional income-tax on Rs. 1,64,772 is clearly a result of non-application of mind.
4. In the premises, the intimation dated December 2, 1990 (exhibit 'D'), the impugned order dated February 22, 1991 (exhibit 'F'), and the order dated March 21, 1991 (exhibit 'I'), in so far as it levies additional tax on Rs. 1,64,772 are set aside.
5. Rule is made absolute accordingly.
6. Certified copy expedited.