Law:

Section:

Section 263, read with section 143(1), of the Income-tax Act, 1961 - Revision - Of orders prejudicial to interest of revenue - Assessment year 1972-73 and 1973-74 - Whether Commissioner acting under section 263(1) could legally set aside an order of assessment made under section 143(1) in pursuance of scheme 'To help new taxpayers in small income groups' evolved by Government - Held, yes FACTS The Tribunal held that Commissioner acting under section 263(1) could legally set aside an order of assessment made under section 143(1) in pursuance of the scheme 'to help the new taxpayers in the small income groups' evolved by the Government. On reference: HELD Following the decision in CIT v. Pushpa Devi [1987] 164 ITR 639 and CIT v. Smt. Rambha Devi[1987] 164 ITR 658, it was to be held that Commissioner acting under section 263(1) could legally set aside an order of assessment made under section 143(1) in pursuance of the scheme 'to help the new taxpayers in the small income groups' evolved by the Government. Note : The decision is in favour of the department. CASE REVIEW CIT v. Pushpa Devi[1987] 164 ITR 639 (Pat.) and CIT v. Rambha Devi (Smt.)[1987] 164 ITR 658 (Pat.)followed and relied upon. JUDGMENT On an application by the Revenue under section 256(1) of the Income-tax Act, 1961, the following questions stated to be questions of law arising out of the order of the Tribunal have been referred to this court for its opinion: "1. Whether, on the facts and in the circumstances of the case, the Tribunal has rightly held that the assessment orders, having been passed by the Income-tax Officer after necessary enquiries in pursuance of the scheme to help the new taxpayers in the small income groups' launched by the Government, were not erroneous so as to enable the Commissioner of Income-tax to assume jurisdiction under section 263(1) of the Income-tax Act, 1961? 2. Whether, on the facts and in the circumstances of the case, the Tribunal has rightly held that the Commissioner of Income-tax did not follow the principles of natural justice before passing the impugned order and so his…

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