{"id":7667,"date":"1976-08-17T00:00:00","date_gmt":"1976-08-16T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/commissioner-of-income-tax-west-vs-simon-carves-limited-on-17-august-1976"},"modified":"2018-01-25T20:22:47","modified_gmt":"2018-01-25T14:52:47","slug":"commissioner-of-income-tax-west-vs-simon-carves-limited-on-17-august-1976","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/commissioner-of-income-tax-west-vs-simon-carves-limited-on-17-august-1976","title":{"rendered":"Commissioner Of Income-Tax, West … vs Simon Carves Limited on 17 August, 1976"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Commissioner Of Income-Tax, West … vs Simon Carves Limited on 17 August, 1976<\/div>\n
Equivalent citations: 1976 AIR 2368, \t\t 1977 SCR (1) 207<\/div>\n
Author: H R Khanna<\/div>\n
Bench: Khanna, Hans Raj<\/div>\n
           PETITIONER:\nCOMMISSIONER OF INCOME-TAX, WEST BENGAL-1,CALCUTTA\n\n\tVs.\n\nRESPONDENT:\nSIMON CARVES LIMITED\n\nDATE OF JUDGMENT17\/08\/1976\n\nBENCH:\nKHANNA, HANS RAJ\nBENCH:\nKHANNA, HANS RAJ\nSARKARIA, RANJIT SINGH\nSINGH, JASWANT\n\nCITATION:\n 1976 AIR 2368\t\t  1977 SCR  (1) 207\n 1976 SCC  (4) 435\n\n\nACT:\n\t    Income-tax\t(11 of 1922) ss. 34 and 42,  Income-tax\t Act\n\t(43 of 1961) s.147 and Income-tax Rules, 1922, r. 33  corre-\n\tsponding  to  r. 10 of 1962 Rules--One of the  methods\tmen-\n\ttioned in r. 33 applied for assessment--Higher tax liability\n\tif  another method in rule adopted--If a  case\t of   income\n\tescaping assessment.\n\n\n\nHEADNOTE:\n\t    Section 42, Income-tax Act, 1922, provides for assessing\n\tthe  income, profits gains deemed to accrue or arise in\t the\n\ttaxable territories to a person not resident in the  taxable\n\tterritories.  RuLe 33 of the 1922-Rules is made for  comput-\n\ting  the profits and gains of business deemed to  accrue  or\n\tarise  in India in cases where the income tax officer  finds\n\tthat  the  provisions  of s. 42 do  not\t provide  sufficient\n\tcriteria.   The rule mentions three methods and it would  be\n\topen  to the income-tax officer to select and apply  one  of\n\tthe three methods mentioned in the rule.\n\t    The\t assessee-respondent in the present case, is a\tnon-\n\tresident company carrying on business as construction  engi-\n\tneers  both in India. and in other parts of the world.\t The\n\tIncome-tax Officer found that s. 42 of the 1922-Act did\t not\n\tprovide\t sufficient criteria for computing the\tprofits\t and\n\tgains  of  the assessee deemed to accrue or arise  in  India\n\tand,  therefore,  assessed the income applying\tone  of\t the\n\tthree  methods mentioned in r. 33.  As it resulted in  lower\n\ttax liability, his successor initiated proceedings under  s.\n\t147(b), Income-tax Act, 1961, adopted another method contem-\n\tplated by r. 33. and assessed the income at a higher figure.\n\tThe Appellate Assistant Commissioner, the Tribunal and\tHigh\n\tCourt  held that in making the reassessment  the  Income-tax\n\tOfficer\t could\tnot depart from the  method  of\t computation\n\tfollowed  in the original assessment, and adopt an  alterna-\n\ttive method of computation though permitted by the rule.\n\t    In appeal to this Court, it was contended that the lower\n\ttax liability in the original assessment showed that it\t was\n\ta  case\t of  escaped assessment and as such s.\t147  of\t the\n\t1961-Act was attracted.\n\tDismissing the appeal,\n\t    HELD:  It is open to the Income-tax Officer at the\ttime\n\tof making the original assessment to adopt one of the  three\n\tmethods mentioned in r. 33 for computing the taxable  income\n\tof the assessee.  From the mere fact that the method select-\n\ted  by him resulted in lower tax liability compared  to\t the\n\tliability  which  would have resulted from the\tadoption  of\n\tanother method under the rule, it would not follow that\t the\n\tdiscretion was not  exercised  by the Income-tax Officer  in\n\ta  proper and judicious manner, and that it would be a\tcase\n\tof income escaping assessment.\t[212 E-F]\n\t    (1) The discretion to choose one of the methods in r. 33\n\tought to be exercised by the Income-tax Officer in a  proper\n\tand judicious manner.  In the present ease, there is nothing\n\tto  show  that the discretion was not so  exercised  by\t the\n\tIncome-tax Officer, nor was it suggested that he was actuat-\n\ted  by any oblique motive.  The Income-tax Officer  ordering\n\treassessment  does  not sit as a Court of  appeal  over\t the\n\tofficer\t making the original assessment, nor is it  open  to\n\thim  to substitute his own opinion regarding the  method  of\n\tcomputation  of\t the income especially when  the  method  of\n\tcomputation  adopted at the time of original assessment\t was\n\tpermissible  in\t law.\tThe  taxing  authorities    exercise\n\tquasi-judicial\tpowers, and in doing so, they must act in  a\n\tfair   and  not\t a partisan manner.  Although it is part  of\n\ttheir duty to ensure that no tax, which is legitimately\t due\n\tfrom an assessee, should remain unrecovered, they\n\t208\n\tmust  also at the same time not act in a manner which  indi-\n\tcates that the scales are weighted against the assessee.  It\n\tis not correct to say that unless. the authorities  exercise\n\tthe  power  in a manner most beneficial to the\trevenue\t and\n\tconsequently  most adverse to the assessee, they  should  be\n\tdeemed\tnot to have exercised their discretion in  a  proper\n\tand judicious manner. [213C, 212G]\n\t    (2)\t The original order of the first Income-tax  Officer\n\twas  a\tlegally correct order and was not  vitiated  by\t any\n\terror.\tThe absence of an error would justify the  inference\n\tthat it is not a case of income escaping assessment.   There\n\tis necessarily an element of error which becomes in cases of\n\tincome escaping assessment mentioned in s. 147(b) of Act  of\n\t1961  manifest\tin the light of subsequent  information\t re-\n\tceived\tby the Income-tax Officer.  In the present case,  no\n\tincome has escaped assessment due tO oversight, inadvertence\n\tor  a  mistake committed by the first  Income  Tax  Officer.\n\tTherefore,  the case would not fall within the ambit  of  s.\n\t147(b) of the 1961-Act or s. 34(1)(b) of the 1922-Act.\n\t\t\t\t\t\t\t   [213A-B]\n\n\n\nJUDGMENT:\n<\/pre>\n
\tCIVIL APPELLATE JURISDICTION: Civil Appeal No. 1313 of 1973.\n<\/p>\n
\t\t     (From the Judgment and Order dated 7-9-1972  of
\n\t\t the   Calcutta High Court in Income  Tax  Reference
\n\t\t No. 208 of 1966).\n<\/p>\n
\t\t     V.P.  Raman, Addl. Solicitor Genl.\t  and\tM.N.
\n\t\t Shroff for the Appellant.\n<\/p>\n
\t\t K.  Ray  and D.N. Gupta, for  the  Respondent.\t The
\n\t\t Judgment of the Court was delivered by
\n\t\t     KHANNA, J.\t This appeal on certificate, by\t the
\n\t\t Commissioner of Income-tax, is against the judgment
\n\t\t of  the Calcutta High Court whereby the High  Court
\n\t\t answered  in a reference under the  Income-tax\t Act
\n\t\t the  following question in favour of the  assessee-
\n\t\t respondent and against the revenue:\n<\/p>\n
\t\t “Whether, on the facts and in the circumstances  of
\n\t\t the   case, the Tribunal was right in holding\tthat
\n\t\t in  making  the  reassessment under section  147(b)
\n\t\t of  the Income-tax\tAct,  1961,  the  Income-tax
\n\t\t Officer  could not  depart from     the  method  of
\n\t\t computation permitted in Rule 33 of the  Income-tax
\n\t\t Rules and followed in the original assessment,\t and
\n\t\t adopt\tan  alternative method of  computation\talso
\n\t\t permitted  under the said Rules  (corresponding  to
\n\t\t Rule 10 of the Income-tax Rules, 1962) ?”\n<\/p>\n
\t\t     The  matter  relates  to  the  assessment\tyear
\n\t\t 1959-60, the corresponding financial year for which
\n\t\t ended\ton March 31, 1959.  The assessee is  a\tnon-
\n\t\t resident company carrying on business as  construc-
\n\t\t tion  engineers.  The Income-tax Officer  made\t the
\n\t\t original  assessment  on May 31, 1960\ton  a  total
\n\t\t income\t of Rs. 21,49,169.  On November 5, 1962\t the
\n\t\t Income-tax  Officer  initiated\t proceedings   under
\n\t\t section 147(b) of the Income-tax Act, 1961 (herein-
\n\t\t after\treferred to as the  Act)  and completed\t the
\n\t\t assessment  on February 29, 1964 on a total  income
\n\t\t of Rs. 69,85,097.\n<\/p>\n
\t\t     At\t the  time of the  original  assessment\t the
\n\t\t assessee filed the return of income along with\t the
\n\t\t auditor’s  certificate of the trading\tresults\t  of
\n\t\t the various contracts.\t One of those contracts\t was
\n\t\t in  respect of work at Durgapur with the  Hindustan
\n\t\t Steel Ltd.  In respect of that work
\n\t\t 209<\/span>
\n\t\t the assessee filed a provisional estimate of income
\n\t\t which\twas  arrived at “by calculating\t the  income
\n\t\t that  could be attributable in relation to the\t tax
\n\t\t deducted under section 18(B) by the Hindustan Steel
\n\t\t Ltd.”\tThe Income-tax Officer computed\t the  income
\n\t\t from  that  contract at Rs. 5,33,164.\t The  income
\n\t\t from  the  other  contracts  was  computed  at\t Rs,
\n\t\t 16,16,005 “as per audited statements.”\n<\/p>\n
\t\t     In the reassessment proceedings the  Income-tax
\n\t\t Officer purported to find as under:\n<\/p>\n
\t\t     (i) That the assessee’s outlay in India to\t the
\n\t\t total\toutlay\tin various contracts  represented  a
\n\t\t fair  index of operations carried out in India\t and
\n\t\t as such 60 per cent of the profits attributable  to
\n\t\t sterling payments and claimed to be exempt  related
\n\t\t to  operations\t in India and fell to be included in
\n\t\t the assessee’s total income;\n<\/p>\n
\t\t     (ii)  that the figure of depreciation  required
\n\t\t to be changed; and\n<\/p>\n
\t\t    (iii) that some portion of the income had to  be
\n\t\t assessed under section 4(1)(A) on receipt basis.
\n\tThe total income of the assessee, as already mentioned,\t was
\n\tdetermined as a result of reassessment to be Rs.  69,85,097.
\n\tIn arriving at the figure of the total income the Income-tax
\n\tOfficer estimated the income in respect of Durgapur contract
\n\tto be Rs. 5,33,164 as had been done in the original  assess-
\n\tment.  Regarding the other contracts, the Income-tax Officer
\n\tdetermined  the income of the assessee in reassessment\tpro-
\n\tceedings to be Rs. 64,51,933.  The difference in the  income
\n\tcomputed  at the time of the original assessment and at\t the
\n\ttime of reassessment was due to the fact that the Income-tax
\n\tOfficer\t at  the  time of original  assessment\tadopted\t one
\n\tmethod of computation under rule 33 of the Income-tax Rules,
\n\t1922 while the Income-tax Officer making reassessment adopt-
\n\ted another method under that rule.\n<\/p>\n
\t    On appeal it was submitted before the Appellate  Assist-
\n\tant  Commissioner on behalf of the assessee that the  action
\n\tof the Income-tax Officer in reopening the assessment  under
\n\tsection\t 147(b)\t was  without  jurisdiction  and  that\t the
\n\tIncome-tax  Officer  had  no  jurisdiction   to\t change\t the
\n\tmethod\tof computation as originally adopted in the  revised
\n\tproceedings.  The Appellate Assistant Commissioner held that
\n\tthe  proceedings under section 147(b) were bad and that\t the
\n\tIncome-tax Officer could not adopt an alternative method  of
\n\tcomputation in the reassessment proceedings.  He, therefore,
\n\tallowed the appeal.  The Appellate Assistant Commissioner at
\n\tthe same time observed that the Income-tax Officer would  be
\n\tjustified  in computing the income to  be Rs. 22,23,231\t and
\n\tthat the assessee had no objection to such a revision.
\n\t    In\tappeal\tbefore the  Tribunal the  department   urged
\n\tthat the Appellate Assistant Commissioner was not  justified
\n\tin holding that the Income-tax Officer (i) had no  jurisdic-
\n\ttion  to start proceedings under section 147(b) of the\tAct;
\n\tand (ii) that the Appellate Assistant
\n\t210<\/span>
\n\tCommissioner had erred in allowing deductions in the  income
\n\tof the assessee.  The Tribunal held on the first ground that
\n\tproceedings under section  147(b) had been validly  initiat-
\n\ted.   Regarding the second ground, the Tribunal observed  in
\n\tagreement with the Appellate Assistant Commissioner that the
\n\tmode  of computation adopted in the original assessment\t was
\n\tone permitted under rule 33 of the Income-tax Rules 1922 and
\n\tthat  the mode adopted in reassessment was another  alterna-
\n\ttive method.  The tribunal held that both the methods  being
\n\tpermissible,  it  could\t not be said that  any\tmistake\t was
\n\tcommitted in computing the income at the time of the  origi-
\n\tnal assessment on a particular basis adopted with  reference
\n\tto rule 33.  In the opinion of the Tribunal, the  Income-tax
\n\tOfficer\t could not in reassessment proceedings\tdepart\tfrom
\n\tthe method of  computation  adopted in the original  assess-
\n\tment.\tThe Tribunal directed that the reassessment be\tmade
\n\t“adopting the same method of computation as in the  original
\n\tassessment subject to any adjustments which may be justified
\n\tsuch as excess depreciation being charged in the account and
\n\tso on.”\n<\/p>\n
\t    At the instance of the revenue,  the question reproduced
\n\tabove was referred to the High Court. The High Court,  while
\n\tanswering the question against the revenue, referred to\t the
\n\tconnotation of the words “escaped income” and observed
\n\t\t       ”  ….\tit means an income which the  asses-
\n\t\t see  has  succeeded  in getting away  with  or\t has
\n\t\t eluded\t observation or search or notice of the\t tax
\n\t\t authorities.\tIn  other words, it cannot  mean  an
\n\t\t item of income which has not been taxed by purusing
\n\t\t a  method approved by law.  In the   instant  case,
\n\t\t the  excess income was not taxable under the  third
\n\t\t method\t but  it  has become  taxable  by  following
\n\t\t another method sanctioned by the same rule, namely,
\n\t\t rule 33.  This is not, therefore, a case of escaped
\n\t\t income which has not been brought into the orbit of
\n\t\t taxation in the reassessment proceedings.”
\n\t  In   appeal  before  us  learned   Additional\t   Solicitor
\n\tGeneral has assailed the judgment of the High Court and\t has
\n\tcontended  that the High Court was in error in holding\tthat
\n\tthe instant case was not one of income escaping\t assessment.
\n\tAs  against  that,  Mr.\t Ray  on  behalf  of  the  assessee-
\n\trespondent  has\t canvassed for the correctness of  the\tview
\n\ttaken by the High Court.\n<\/p>\n
\t    Before dealing with the contentions advanced, it may  be
\n\tapposite to refer to the relevant provisions.  According  to
\n\tsection 4(1 )(c) of the Indian Income-tax Act, 1922, subject
\n\tto  the\t provisions  of that Act, the total  income  of\t any
\n\tprevious year of any person includes all income, profits and
\n\tgains  from whatever source derived which if such person  is
\n\tnot  resident in the taxable territories during\t such  year,
\n\taccrue\tor arise or are deemed to accrue or arise to him  in
\n\tthe  taxable territories during such year.  Sub-section\t (1)
\n\tof section 42 of the Act of 1922, inter alia, provides\tthat
\n\tall  income, profits or gains accruing or  arising,  whether
\n\tdirectly or indirectly, through or from any business connec-
\n\ttion  in  the  taxable territories, shall be  deemed  to  be
\n\tincome
\n\t211<\/span>
\n\taccruing  or  arising within the  taxable  territories,\t and
\n\twhere the person entitled to the income, profits or gains is
\n\tnot resident in the taxable territories, shall be chargeable
\n\tto  income-tax\teither\tin his name or in the  name  of\t his
\n\tagent.\t According to sub-section (3) of section 42, in\t the
\n\tcase  of  a  business of which all the\toperations  are\t not
\n\tcarried\t out  in the taxable territories,  the\tprofits\t and
\n\tgains of the business deemed under this section to accrue or
\n\tarise in the taxable territories shall be only such  profits
\n\tand gains as are reasonably attributable to that part of the
\n\toperations carried out in the taxable territories.
\n\t    The\t assessee-respondent in the present case carried  on
\n\tbusiness  as construction engineers both in India and  other
\n\tparts of the world. The Income-tax Officer, it seems,  found
\n\tthat the provisions of section 42 of the Act of 1922 did not
\n\tprovide\t sufficient criteria for computing the\tprofits\t and
\n\tgains of business deemed to accrue or arise in India. Resort
\n\twas accordingly had to rule 33 of the 1922 Rules.  The above
\n\trule has been made to meet such an eventuality, and reads as
\n\tunder:\n<\/p>\n
\t\t “In any case in  which the  Income-tax\t Officer  is
\n\t\t of  opinion that the actual amount of\tthe  income,
\n\t\t profits or gains accruing or arising to any  person
\n\t\t residing  out\tof the taxable\tterritories  whether
\n\t\t directly or indirectly through or from any business
\n\t\t connection in the taxable territories or through or
\n\t\t from  any property in the taxable  territories,  or
\n\t\t through or from any asset or source of\t income\t  in
\n\t\t the   taxable territories, or through or  from\t any
\n\t\t money lent at interest and brought into the taxable
\n\t\t territories  in  cash or in kind cannot  be  ascer-
\n\t\t tained, the amount of such income, profits or gains
\n\t\t for the purposes of assessment to income-tax may be
\n\t\t calculated  on such percentage of the\tturnover  so
\n\t\t accruing  or arising as the Income-tax Officer\t may
\n\t\t consider  to be reasonable, or on an  amount  which
\n\t\t bears\tthe same proportion to the total profits  of
\n\t\t the  business\tof such person (such  profits  being
\n\t\t computed  in accordance with the provisions of\t the
\n\t\t Indian Income-tax Act) as the receipts so  accruing
\n\t\t or arising bear to the total receipts of the  busi-
\n\t\t ness  or  in such other manner\t as  the  Income-tax
\n\t\t Officer may deem suitable.”\n<\/p>\n
\t\t Shorn of the parts with which we are not concerned,
\n\t\t the  rule  provides that in any case in  which\t the
\n\t\t Income-tax  Officer  is  of the  opinion  that\t the
\n\t\t actual amount of income, profits or gains  accruing
\n\t\t or arising to any person residing out of the  taxa-
\n\t\t ble  territories, whether directly  or\t indirectly,
\n\t\t through  or  from any business\t connection  in\t the
\n\t\t taxable  territories  cannot  be  ascertained,\t the
\n\t\t amount\t of  such income, profits or gains  for\t the
\n\t\t purpose  of assessment to income-tax may be  calcu-
\n\t\t lated\n<\/p>\n
\t\t     (i)  on  such  percentage of  the\tturnover  so
\n\t\t accruing  or arising as the Income-tax Officer\t may
\n\t\t consider to be reasonable, or\n<\/p>\n
\t\t    (ii)  on an amount which bears the same  propor-
\n\t\t tion  to the total profits of the business of\tsuch
\n\t\t person (such
\n\t\t 212<\/span>
\n\t\t profits  being\t computed  in  accordance  with\t the
\n\t\t provisions  of\t the Indian Income-tax Act)  as\t the
\n\t\t receipts  so accruing or arising bear to the  total
\n\t\t receipts of the business, or\n<\/p>\n
\t\t    (iii)  in  such other manner as  the  Income-tax
\n\t\t Officer may deem suitable.\n<\/p>\n
\t\t The above rule makes  it clear that if other condi-
\n\t\t tions mentioned in the rule are satisfied, it would
\n\t\t be open to the Income-tax Officer in computing\t the
\n\t\t income, profits or gains to apply  one of the three
\n\t\t methods  mentioned in the rule.  It is\t the  common
\n\t\t case of the parties, and that is also the  underly-
\n\t\t ing assumption of the question referred to the High
\n\t\t Court,\t that the Income-tax Officer in\t making\t the
\n\t\t original  assessment adopted one method  while\t the
\n\t\t Income-tax  Officer  making  reassessment   adopted
\n\t\t another  method contemplated by rule 33. The  ques-
\n\t\t tion  with  which we are concerned  is\t whether  it
\n\t\t would\tbe a case of income escaping  assessment  if
\n\t\t the Income-tax Officer adopts a method of  computa-
\n\t\t tion  which is permissible under the law but  which
\n\t\t method\t results in lower tax liability compared  to
\n\t\t the  other method which too is permissible in\tlaw.
\n\t\t According  to\tthe  learned  Additional   Solicitor
\n\t\t General,  the\tadoption  of a\tmethod\teven  though
\n\t\t permitted  by\trule 33 which results in  lower\t tax
\n\t\t liability  of\tthe assessee compared to  the  other
\n\t\t method\t mentioned  in the rule\t would\twarrant\t the
\n\t\t conclusion  that income has escaped assessment\t and
\n\t\t as  such section 147 of the Act of 1961  would\t get
\n\t\t attracted.   After  giving the matter\tour  earnest
\n\t\t consideration,\t we find it difficult to accept\t the
\n\t\t above\tcontention.   It was open, as  already\tmen-
\n\t\t tioned,  to the Income-tax Officer at the  time  of
\n\t\t making the original assessment to adopt one of\t the
\n\t\t three\tmethods mentioned in rule 33  for  computing
\n\t\t the taxable income of the assessee. Discretion\t was
\n\t\t vested by rule 33 in the Income-tax Officer for the
\n\t\t purpose  of making his choice of the  methods,\t and
\n\t\t the same was to be exercised in a proper and  judi-
\n\t\t cious\tmanner.\t There is nothing before us to\tshow
\n\t\t that  the discretion was not exercised by the\tsaid
\n\t\t officer  in  a proper or judicious manner.   It  is
\n\t\t also not suggested that the Income-tax Officer\t was
\n\t\t actuated by some oblique motive. From the mere fact
\n\t\t that the method selected by him was such as result-
\n\t\t ed in\tlower tax liability of the assessee compared
\n\t\t to the liability which would have resulted from the
\n\t\t adoption of other method, it would not follow\tthat
\n\t\t the  discretion was not exercised in a\t proper\t and
\n\t\t judicious  manner. The taxing authorities  exercise
\n\t\t quasi judicial powers and in doing so they must act
\n\t\t in  a fair and not a partisan manner.\tAlthough  it
\n\t\t is part. of their duty to ensure that no tax  which
\n\t\t is legitimately due from an assessee should  remain
\n\t\t unrecovered,  they must also at the same  time\t not
\n\t\t act  in a manner as might indicate that scales\t are
\n\t\t weighted against the assessee. We are wholly unable
\n\t\t to subscribe to the view that unless those authori-
\n\t\t ties exercise the power in a manner most beneficial
\n\t\t to the revenue and consequently most adverse to the
\n\t\t assessee  they should be deemed not to\t have  exer-
\n\t\t cised it in a proper and judicious manner.
\n\t    The order made by the Income-tax  Officer at the time of
\n\tthe original assessment was a legally correct order and\t was
\n\tnot vitiated
\n\t213<\/span>
\n\tby  any error.\tThe absence of an error in that order  would
\n\tjustify\t the  inference that the present is not\t a  case  of
\n\tincome escaping assessment.  There is necessarily an element
\n\tof error in cases of income escaping assessment mentioned in
\n\tsection\t 147(b) of the Act of 1961. Such error resulting  in
\n\tincome escaping assessment becomes manifest in the light  of
\n\tinformation  coming subsequently into the possession of\t the
\n\tIncome-tax  Officer.   Where, as in the\t present  case,\t the
\n\torder  making the original assessment was a legally  correct
\n\torder and was not vitiated by any error, the case would\t not
\n\tbe  one which would fall within the ambit of section  147(b)
\n\tof  the Act of 1961 or section 34(1)(b) of the Act of  1922.
\n\tWe  may add that the Income-tax Officer\t ordering  reassess-
\n\tment’ does not sit as a court of appeal over the  Income-tax
\n\tOfficer\t making the original assessment.  Nor is it open  to
\n\tthe  Income-tax Officer ordering reassessment to  substitute
\n\this own opinion regarding the method of computing the income
\n\tfor  that  of the Income-tax Officer who made  the  original
\n\tassessment, especially when the method of computation adopt-
\n\ted  at\tthe time of original assessment was  permissible  in
\n\tlaw.   The fact that the adoption of a different  method  of
\n\tcomputation  would  have resulted ‘in higher  yield  of\t tax
\n\twould  not in such a case justify the reopening of  the\t as-
\n\tsessment.\n<\/p>\n
\t    It\thas  been  argued on behalf of\tthe  appellant\tthat
\n\treassessment  under section 147(b) would be justified  where
\n\tin the original assessment income liable to tax has  escaped
\n\tassessment  due\t to  oversight, inadvertence  or  a  mistake
\n\tcommitted  by the Income-tax Officer.  The present  however,
\n\twe  find,  is  a case which does not fall in  any  of  those
\n\tcategories.\n<\/p>\n
\t    We\twould,\ttherefore, uphold the judgment of  the\tHigh
\n\tCourt and dismiss the appeal with costs.\n<\/p>\n
\tV.P.S.\t\t\t\t\t\tAppeal\tdis-\n\tmissed.\n\t214<\/span>\n\n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Commissioner Of Income-Tax, West … vs Simon Carves Limited on 17 August, 1976 Equivalent citations: 1976 AIR 2368, 1977 SCR (1) 207 Author: H R Khanna Bench: Khanna, Hans Raj PETITIONER: COMMISSIONER OF INCOME-TAX, WEST BENGAL-1,CALCUTTA Vs. RESPONDENT: SIMON CARVES LIMITED DATE OF JUDGMENT17\/08\/1976 BENCH: KHANNA, HANS RAJ BENCH: KHANNA, HANS […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-7667","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nCommissioner Of Income-Tax, West ... vs Simon Carves Limited on 17 August, 1976 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/commissioner-of-income-tax-west-vs-simon-carves-limited-on-17-august-1976\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Commissioner Of Income-Tax, West ... vs Simon Carves Limited on 17 August, 1976 - 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