Law: Income Tax Act, 1961

Section: 147,219,148

Income-tax--Reassessment---Scope of reassessment---Reassessment proceedings are for benefit of Revenue---Income for purposes of reassessment cannot be reduced below income assessed originally---Indian Income Tax Act, 1961, 5.147. (b) Income-tax--- ----Reassessment---Advance tax---Failure to submit returns---Reassessment proceedings stated against assessee---Assessee filing returns showing income on which tax payable is less than amount paid as advance tax---Advance tax had lost its character and had to be treated as income-tax for relevant assessment year ---Assessee could not claim that reassessment proceedings should be completed and income-tax liability reduced---Claim of assessee for refund of excess tax paid cannot be entertained---Indian Income Tax Act, 1961, Ss.219 & 147---Constitution of India, Art. 226. The proceedings under section 147 of the Income Tax Act, 1961, are for the benefit of the Revenue and not of the assessee and the assessee cannot be permitted to convert the reassessment proceedings as his appeal or revision, in disguise, and seek relief in respect of items earlier rejected or claim relief in respect of items not claimed in the original assessment proceedings, unless relatable to escaped income and reagitate concluded matters. It is further clear that allowance of such claim in respect of escaped assessment in the case of reassessment has to be limited to the extent to which they reduce the income to that originally assessed. The Supreme Court has categorically held that the income for the purpose of reassessment cannot be reduced below the income originally assessed. Any sum paid by or recovered from the assessee as advance tax shall be treated as payment of tax in respect of the income of the period which would be the previous year for an assessment for the assessment year next following the financial year in which it was payable. Once the amount of advance tax is treated as payment of tax in respect of the income of the relevant previous year, the amount loses its character of advance tax and is treated as income-tax paid in respect of the income of the relevant previous year. The petitioner was an individual. For the assessment…

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