Law:

Section:

Section 143, read with section 263, of the Income-tax Act, 1961 - Assessment - On remand - Assessment year 1989-90 - Commissioner, while exercising powers under section 263, set aside assessment order and directed Assessing Officer to compute correct profit under section 115J - Before Assessing Officer, assessee claimed deduction of certain expenditure in relevant assessment year contending that said claim was made in subsequent assessment year but in assessment order for that year, Assessing Officer held that expenditure could not be allowed as it related to earlier assessment year, i.e., relevant assessment year - Assessing Officer rejected assessee's contention on ground that order passed by Commissioner under section 263 was on limited issue of computing profit under section 115J and, therefore, it was not possible for him to look into issue raised by assessee - Whether since order passed under section 263 by Commissioner related to re-computation of income, assessee was well within its rights to place all material on record of Assessing Officer to enable him to re-compute correct income and Assessing Officer ought to have taken those facts into consideration for purposes of computing correct income of assessee - Held, yes FACTS The assessment order made by the Assessing Officer did not contain computation of income under section 115J. The Commissioner, therefore, in exercise of her powers under section 263, set aside the assessment with a direction to the Assessing Officer to compute profit under section 115J. Before the Assessing Officer, the assessee claimed deduction of certain expenditure contending that said claim was made in the subsequent assessment year, i.e., 1990-91, but in the assessment order for that year, the Assessing Officer held that the expenditure could not be allowed in the assessment year 1990-91, as it related to the assessment year 1989-90, i.e., the relevant assessment year. The Assessing Officer rejected the assessee's contention on the ground that the order passed by the Commissioner under section 263 was on the limited issue of computing the profit under section 115J and, therefore, it was not possible for him to look into the…

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