IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITR Nos.51-52 of 1987 Date of decision: 23.1.2008 M/s. Hans Raj Raj Kumar, Jalandhar ......Applicant Versus The Commissioner of Income-tax, Jalandhar ......Respondent CORAM:- HON'BLE MR.JUSTICE SATISH KUMAR MITTAL HON'BLE MR.JUSTICE RAKESH KUMAR GARG * * * Present: Mr. Akshay Bhan, Advocate for the assessee. Mr. Sanjiv Bansal, Advocate for the revenue. * * * Rakesh Kumar Garg, J . This judgement will dispose of ITR Nos.51 and 52 of 1987 arising out of ITA Nos.240 and 241 (ASR)/1983 for the assessment years 1976-77 & 1977-78. The Income Tax Tribunal, Amritsar Bench, Amritsar, vide its order dated 24.10.1986 referred the following single comprehensive question to seek the opinion of this Court in the case of applicant-assessee for the assessment years 1976-77, 1977-78 which is stated to be arising out of the order of the Income Tax Appellate Tribunal, Amritsar:- “Whether on the facts and in the circumstances of the case, the Tribunal is right in law in upholding the action of the C.I.T. (A) to set aside the assessments of a years 1976-77 and 1977-78 with a direction to the I.T.O. to make them afresh and not annulling these.” Briefly stated the relevant facts are that the assessee is a firm and the proceedings relate to its assessment years 1976-1977 and 1977- 78 for which the relevant previous years are financial years 1975-76 and 1976-77 i.e. from 1.4.1975 to 31.3.1976 and from 1.4.1976 to 31.3.1977. The business premises of the assessee firm as well as the residential premises of its partners were searched by the income tax department on 31.8.1976 and all its books including one heap register were seized. In spite of issuing notice under Section 139(2) for the two years on 3.8.1976 and 7.9.1977, returns of income were not filed. Eventually the Income tax officer completed ex-parte assessments under Section 144 on 29.3.1978 and 22.4.1978 computing the total income at Rs.2,59,913/- and 2,69,750/- respectively. The assessee filed application under Section 146 which was rejected. However, the appeals for these years were allowed by the CIT (A) vide a consolidated order dated 31.12.1978 and the Income-tax Officer was thereby directed to make fresh assessments. The CIT(A) had, inter alia, recorded in the order that the assessee had agreed to complete inspection of its account books and other documents in the presence of the department on 20 working days from 1.4.1979 and file its return of income for the two years within a week thereafter. The CIT (A) accepted the assessee’s submissions that it was not given an opportunity to inspect the reference and this according to him was a denial of natural justice and for this reason he set aside the assessment for the assessment year 1976-77 directing the Assessing Officer to verify various facts and figures and allow opportunity to assessee before making fresh assessment. For the assessment year 1977- 78 also the C.I.T. (A) has held that the assessee was not given proper opportunity to scrutinize the books of account and the material on the basis of the additions were made to the declared trading result. Observing that the assessee was prepared to get the various books of accounts and documents copied at his own cost, the Income tax Officer’s refusal to the assessee to get copies thereof, according to him, resulted in denial of proper opportunity & natural justice to the assessee which vitiated the assessment proceedings. For these and other reasons recorded in paragraph 10 of his order, he set aside the order of assessment for assessment year 1977-78 as well with a direction to the Assessing Officer to make a fresh assessment order after giving the proper opportunity to the assessee. Aggrieved against the above orders of the CIT(A), the assessee filed an appeal before the Tribunal and, inter alia, raised a common ground namely that the CIT(A) having found that the assessment orders were passed without affording the proper opportunity which meant denial of principles of natural justice, he should not have merely set aside the orders of the assessment but should have annulled the assessments. The Tribunal vide its order dated 29.1.1986 dismissed both the appeals filed by the assessee. The assessee filed Review Application Nos.67 & 68 (ASR) 1986 by raising various questions of law as stated in the reference application, however, the Tribunal vide its order dated 24.10.1986 referred the single comprehensive question for the opinion of this Court as referred in para No.1 of the judgement above. At the time of hearing Mr. Sanjiv Bansal, Advocate appearing for the revenue informed the Court that since the matter was remanded by the Tribunal to make a fresh assessment and in fact the fresh assessment has been made as per the order of the Tribunal and therefore this reference has become infructuous. The said factual statement made by the learned counsel for the revenue has not been disputed by the counsel for the assessee-applicant. In view of the facts stated above, the question of law referred by the Tribunal has become redundant and, thus, reference application is disposed of as having become infructuous. (RAKESH KUMAR GARG) JUDGE January 23, 2008 (SATISH KUMAR MITTAL) ps JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITR Nos.51-52 of 1987 Date of decision: 23.1.2008 M/s. Hans Raj Raj Kumar, Jalandhar ......Applicant Versus The Commissioner of Income-tax, Jalandhar ......Respondent CORAM:- HON'BLE MR.JUSTICE SATISH KUMAR MITTAL HON'BLE MR.JUSTICE RAKESH KUMAR GARG * * * Present: Mr. Akshay Bhan, Advocate for the assessee. Mr. Sanjiv Bansal, Advocate for the revenue. * * * Rakesh Kumar Garg, J .