I.T.A. NO. 3278 OF 1980-81, DECIDED ON 14TH OCTOBER, 1981. Versus I.T.A. NO. 3278 OF 1980-81, DECIDED ON 14TH OCTOBER, 1981.
ORDER
1. The appellant is an A.O.P. For the charge year 1976-77 income was derived from plying of buses on Lahore-Gujrat route. Original assessment was made on 22nd September, 1976 at a loss of Rs.5,310. Thereafter the Income Tax Officer issued notice under section 34 the repealed Income Tax Act. The Income Tax Officer while reprocessing the assessments determined unadjusted loss of Rs.13 or holding as under:-
2. "The facts of the case briefly mentioned are that assess, purchased two buses bearing Nos. LEJ-1117 and LFH 9955 with total cost of Rs.183,500 in the charge year 1973-7y. Depreciation on the said vehicles was allowed at Rs.1,46,958 thereby leaving WDV at Rs.36,542 for the year next following, Both the buses referred to above were disposed off during the charge year 1975-76 for total consideration of Rs.1,01,000. The profit u/s. 10 (2) (vii) proviso 2 would thus work out to Rs.64,458 for the assessment year 1975-76 which if set off against the profits calculated above would result in balance profits of Rs.43,082. There was brought forward loss of Rs.44,388. After setting off the said loss of Rs.44,388 against profits of Rs.43,082 as calculated above there will remain unadjusted loss of Rs.1306 to be carried forward".
3. The assessee went in appeal and the learned Appellate Assistant Commissioner maintained the action of re-opening of assessment but while dealing the assessee's grievance regarding computation of loss made the following directions:
4. "Next grievance of appeal is that while re-framing the assessment for the assessment year 1976- 77 the Income Tax Officer has also re-computed loss in the assessment year 1976-77 at Rs.1,306 against assessed loss of Rs.65,764 and as he has re-opened only one assessment order under section 34 (1) he can't re-determine loss in respect of the immediately preceding assessment year also. This contention is absolutely correct and is accepted as the Income Tax Officer is re-framing assessment for the assessment year 1976-77 his action re-framing of loss for the assessment year 1975-76 though factually and arithmetically correct is legally altogether incorrect. For that purpose he has to re-open the case for the assessment year 1976-77. In fact he re-calculated the loss in order to set off the loss against income for the assessment year 1976-77, but he lost sight of the legal position in this regard. He is directed to re-compute loss for the assessment year 1975-76 to accordance with the provisions of law to the separate order for the assessment year 1975-76. At present the loss assessed as per original assessment order dated 29th September 1975 for the assessment year 1975-76 at Rs. 65 764 stands",.
2. The appellant's Authorised Representative did not press his objection taken in ground No.2. The solitary grievance stated before me pertained to the directions given by the learned Appellate Assistant Commissioner for the assessment year 1975-76. It was submitted that in appeal; the learned Appellate Assistant Commissioner, was legally required to adjudicate the issue involved for the year under review and the appellate Court had no jurisdiction to issue directions for the preceding year. The Departmental Representative very frankly conceded that the learned Appellate Assistant Commissioner transgressed her limits in directing the income Tax Officer to re-compute loss for the assessment year 1975-76. There being no dispute in appeal for the charge year 1975-76, the learned Appellate Assistant Commissioner erred in issuing directions while bearing appeal for the charge year 1976-77. I would, therefore, delete the following observations of the learned Appellate Assistant 6oMMisioner from the impugned order:-
5. "He is directed to re-compute loss for the assessment year 1975-76 in accordance with law in a separate order for the assessment year 1975-76".
6. 'These observations being beyond the scope of jurisdiction of the appellate Court stand deleted. The appeal succeeds to that extent.
7. M.B.A./486/T Order accordingly.