Law: Income Tax Ordinance, 1979

Section: 59

Income Tax Ordinance (XXXI of 1979)---S.59---Self-Assessment Scheme (1992-1993), para. 4(ii)---C.B.R. Circular No. 16 of 1982----Object and purpose of Scheme---Selection of return of assessee for total audit---Condition precedent---Jurisdiction and powers of departmental officers---Where according to the Assessing Officer he got local enquiries conducted after receiving the return and then on the basis of that enquiry the case was excluded from the purview of Self-Assessment Scheme, the procedure was not in consonance with the letter and spirit of law---Assessment order in pursuance of setting apart of the case for total audit was cancelled by the Tribunal and Assessing Officer was directed to process the case of assessee under the provisions of Self-Assessment Scheme (1992-93). Under para. 4(ii) of the Self-Assessment Scheme for the assessment year 1992-93 a return may be selected for audit with the approval of Regional Commissioner of Income-tax where gross understatement of income is suspected on the basis of definite information based on material evidence. This provision is to be considered in the totality of the scheme for self-assessment and the spirit contained therein. The Self-Assessment Scheme has been devised by reposing confidence in the assessee and provisions have been made whereby an assessee can be deprived of this benefit, if the department receives information that the confidence reposed in the assessee has been betrayed. However, this does not mean that any provision contained in Self-Assessment Scheme including para. 4(ii) of the Self-Assessment Scheme for the assessment year 1992-93, has vested discretion in the departmental officers for perusing any concealment or mala fides on the part of assessees. The departmental officers have no jurisdiction to initiate any enquiry or probe, for the purpose of excluding any return from the purview of Self-Assessment Scheme, meaning thereby that no enquiry or probe could be initiated and no roving and fishing enquiries could be made prior to the selection of case for total audit for the purpose of excluding the case from the purview of Self-Assessment Scheme. The condition precedent is that there…

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