Commissioner of Income Tax vs Mohan Lal Kansal

D.S. Tewatia, J.—The ITO completed the assessment for the assessment year 1970-71 on 15-12-1970. However, on 19-1-1973, in view of the law laid down in BRIJ BUSHAN LAL Vs. COMMISSIONER OF Income Tax, PUNJAB., , he reopened the assessment and issued notice u/s 148, read with section 147(6) of the income tax Act, 1961 (''the Act''). The ITO in his order dated 19-11-1974 completed the fresh assessment and included in the income of the assessee Rs. 11,575 as being his profit on the basis of 10 per cent profit on the value of stores supplied by MES to the assessee for the execution of the contract which he had entered into. The AAC sustained the said order of the ITO. However, on an appeal, the Tribunal by its order dated 13-12-1976 set aside the orders of the ITO and that of the AAC holding that Rs. 11,575 treated as profit are not includible.

On an application u/s 256(1) of the Act, the Tribunal at the instance of the revenue has referred the following question of law for the opinion of this Court :

"Whether, on the facts of the case, the income tax Appellate Tribunal has been right in law in holding that the reassessments u/s 147(6) were wrongly framed in the cases ?"

The question has to be answered in the affirmative in favour of the assessee and against the revenue in view of the Supreme Court decision reported as Brij Bhushan Lal Parduman Kumar Vs. Commissioner of Income Tax , Haryana Himachal Pradesh and New Delhi III, , which has expressly overruled Brij Bushan Lal''s case (supra) on the basis of which the assessment was reopened by the ITO for including Rs. 11,575 in the income of the assessee. No order as to costs.