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I. T. As. Nos. 2616 and 2617 of 1977‑78, decided on 28th May, 1979.

--‑‑‑ S. 23 (3)‑Jurisdiction‑Appellate Tribunal on appellant's appeal deciding a certain Income‑tax Officer to lave no jurisdiction in matter and as such automatically meaning Income‑tax Officer (Companies '' Circle) to have such jurisdiction‑Order of Tribunal having attained ' finality binding on assessee as well as Department‑Income‑tax Officer, Companies Circle, having completed assessment of company for imme diately past year, objection regarding lack of jurisdiction, held, without force.

‑‑‑ S. 34‑A‑Revision‑Inspecting Assistant Commissioner's power to call for records of any case‑Not confined to cases where orders already passed and such orders also prejudicial to interest of revenue but also extend to calling for records of any proceeding under Income‑tax Act, 1922‑Proceedings started by Income‑tax Officer, even an order passed though for dropping of proceedings‑Such order too prejudicial to interest of revenue due to no assessment being completed on account of assessee's plea of assessment order passed by an Income‑tax Officer (dropping proceedings) being erroneous‑Assessee, held could not approbate and reprobate and having asked Income‑tax Officer to drop proceeding because of assessment having been completed by another income‑tax Officer, assessee could not take plea of order of Income‑tax officer being not of a kind as could be reopened under S. 34‑A.

Aziz Chaudhury, C. A. for Appellant.

Aftab Ahmad, D. R. for Respondent.

These two appeals have been filet against the order of the Inspecting Assistant Commissioner of Income‑tax Companies Range, Zone, I .dated 18‑2‑1977. The assessment year; involved are 1968‑69 and 1969‑70.

2. The brief facts of the case are that the appellant is a private limited company and manufactures nylon cloth. The factory of the assessee is a S .Road, F .while the declared Head Office is at .The assessment for the year 1967‑68 was completed by the Income‑tax Office....on 8‑6‑1972. Subsequently, however, it appears that the Income‑tax Officer, F made the assessment under section 23 (3) on 30‑6‑1972 for the years 1968‑69 to 1971‑72. Before the Income‑tax Officer, the assessee objected to his jurisdiction and filed the returns under protest. The assessee had also filed returns for the years 1968‑69 and 1969‑70, at or 23‑8‑1969 and 20‑9‑1969 with the Income‑tax Officer Companies Circle. Since the Income‑tax Officer, F had completed the assessments which was brought to the notice of the Income‑tax Officer ..therefore he dropped the proceedings on 21‑5‑73. On 20‑6‑1972 the assessee wrote a letter to the Secretary CBR and copy was endorsed to Income‑tax Officer F. However without awaiting for any order of the CBR the Income‑tax Officer F... completed the assessments on 30‑6‑1972. The CBR on the other hand instead of deciding the matter itself after considerable delay to five months wrote to the Authorised Representative of the assessee that he should write to the CIT R However in the meantime the assessment having been completed by the Income‑Officer the matter was taken up with the Tribunal who vide its order dated 30‑6‑1974 held that in such circumstances the only competent authority to decide the issue of jurisdiction of the case lay with the CBR. The operating part of the Tribunal's order is reproduced below :‑

"Consequently we cannot uphold these assessments which for the first year 1961‑68 for the double reason that an assessment had already been made by the ITO Cos and in the subsequent two years because the ITO F, had no jurisdiction over the matter. It was not the ITO who could decide the question about his jurisdiction but it was of course the CBR as referred to above. Consequently following the decision of the High Court as reported above we are constrained to annul all the three assessments."

After this order the IAC took up the matter under section 34‑A of the Income‑tax Act vide his impugned order dated 18‑2‑1977 made assessments for two years 1968‑69 and 1969‑70 and in so assessing adopted the income as was assessed by the ITO F .........

3. The learned A. R. has challenged the order of the IAC on more than one grounds. His first contention was that the IAC ..had no jurisdiction as the matter of jurisdiction is still undecided by the CBR. This contention is without any force. Firstly it is not the case of the appellant that he had places of business at more than one place. The object of challenging the jurisdiction of the ITO F. impliedly was that the jurisdiction in regard to the appellant's case rested with the ITO Cos. Circle ..Once it was decided by the Tribunal on the appeal of the assessee that the ITO F., had no jurisdiction it automatically meant that the Income‑tax Officer, Companies Circle , ..had jurisdiction in the matter. Para. 7 of the Tribunal's order is quoted below for reference‑-

"It will be clear from the perusal of the two notifications that in the Notification issued by the Commissioner of Income‑tax Zone, jurisdiction vested with ITO Cos. Circle I ..,where the "registered offices" of the limited company were situated in the area mentioned above. It therefore follows that according to the notification issued by the Commissioner of Income‑tax Zone, jurisdiction vested with ITO Cos at the time when returns were filed."

The appellant has therefore no legs to stand upon and to urge that the inspecting Assistant Commissioner, had no territorial jurisdiction in his case. Whatsoever is the order of the Tribunal it has attained finality and is binding on the assessee as it is binding on the Department. Apart from this it is pertinent to note that the Head Office of the assessee is at . And the Income‑tax Officer, Companies Circle, .had completed the assessment of the company for the immediately past year.

It was next contended by the Authorised Representative that since the proceedings had been dropped by the Income‑tax Officer, on 21‑5‑1973 the Inspecting Assistant. Commissioner could not reopen the case under, section 34‑A inasmuch as no order has been passed by the assessing officer. According to the Authorised Representative the Inspecting Assistant Com missioner could call for the records of the case where any order has been passed by the Income‑tax Officer which is erroneous and prejudicial to the interest of revenue. This argument is again misconceived. As far as the powers of the Inspecting Assistant Commissioner to call for records of any case under section 34‑A these are not confined only to cases where the order has been passed which is pre-judical to the interest of revenue alone. The powers of the Inspecting Assistant Commissioner under that section include the power to call for the records of any proceedings under the the proceedings had been started by the Income‑tax Officer , .and even an order had been passed though it was for dropping of the proceedings. That order too was prejudicial to the interest of revenue inasmuch as nor assessment could be completed because of the plea of the assessee that the assessment passed by the Income Officer, F which was the basis for dropping the proceedings at became erroneous. The assessee could not approbate and reprobate nor could he take advantage of his own actions. He asked the Income‑tax Officer , ..to drop proceedings because the assessment has been completed by the Income‑tax Officer, but at the same time challenged the order of the Income‑tax Officer F., before the Tribunal on the ground that it was without jurisdiction. The assessee, therefore, cannot take this plea now that the order of the Income‑tax Officer, was not the kind of order which could be reopened under section 34‑A.

The last contention of the learned A. R. was in regard to the quantum of assessment. It was submitted that the IAC has erred in adopting the figures of income as assessed by the ITO F without affording an opportunity of being heard to the assessee. This argument is also without any merit as the assessments completed by the Income‑tax Officer F., were after providing opportunity of being heard to the assessee. So far as the quantum assessment is concerned that cannot be contested merely on the ground that no opportu nity of hearing has been given.

4. As a result of the above discussion both the appeals fail arid are dismissed.

Appeal dismissed.

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