2004 PLP (Trib (PTD)

"(1) Income assessed from the Rima Dall Mills as discussed above and calculated above Rs.454,444 (2) Net loss assessed from the business of Ramesh Lal & Co. as discussed above Rs.(141,539) Rs.312,905 Add salary income as shown Rs. 168,000 Total income assessed for the year Rs.480,905" .

5. The learned CIT(A) confirmed the treatment meted out of the stage of assessment whereby rejected the version of the assessee, observing that the income declared by the assessee in the year under appeal is quite low as compared to the income shown in the immediately preceding year, for the purpose of comparison two sets of income have ` marked difference, and income from salary did not exceed 50% in the immediately preceding year and this year, income from salary shown being more than 50% is just manipulation. He added that the rejection of the claim for acceptance of the return of income under Self- Assessment Scheme on the part of the officer was quite justified whereby assessment so framed under the normal law does not warrant interference, which is confirmed.

6. Heard the learned representatives of the two parties. The learned counsel for the assessee argued that the return is fully qualifying to be processed under the scheme by virtue of "Note" appended to clause 1.1 of Self‑Assessment Scheme vide Circular No.4 of 2001 which reads as under:‑ "The condition regarding percentage increase in tax shall not be applicable if income consists of or includes salary and such income constitutes more than 50 % of the total income declared for the year or where income is derived from house property. "

7. The learned counsel referring above provision of law, stressed that the return is fully qualifying to be processed under Self‑Assessment Scheme as salary of the assessee (Rs.1,68,000) is much more than 50% of the total income of Rs.1,99,000 declared. In the circumstances condition to pay tax by more than 20% of the tax last assessed would not be applicable in case of assessee for the purpose of qualifying in the Self‑Assessment Scheme. The learned counsel added that the learned CIT(A) has mis‑stated that the case has been selected under total audit as there appears no such reference in the assessment order. The learned D.R. representing the department, on the other hand, argued that the case was selected for total audit, therefore, objection raised by the assessee did not arise.

8. Before taking into consideration, the other grounds related to requirement of the scheme to pay tax by more than 20% of the tax last assessed for the purpose of qualifying for the relevant Self‑Assessment Scheme, we would like to record our finding on the plea that the case was sale-deed under total audit or set apart for normal assessment. The assessment order is silent in respect of selection of case under provision of total audit, the learned Assessing Officer has recorded his order in view of the, objection raised by the counsel at the time of assessment with regard to processing of return under normal law and setting apart of the case because of condition of the tax to be higher by 20% and vide para. 3 of the order, he also recorded his version rejecting the assessee's plea observing that assessee was required to nay tax by more than 20% of the tax last assessed to qualify for acceptance of return under the Scheme. On the contrary, there is no discussion in the assessment order in respect of selection of case under total audit as such D.R's version finds no support from the assessment order. Besides there is no other evidence available on record to support the learned D.R. in his version that the case has been selected under total audit, as such bears no merit whereby, rejected being misconceived and presumptive.

9. Returning to the real controversy, we find that the Self- Assessment Scheme for the year 2000‑2001, as contemplated vide Circular No.4 of 2001 initially provides the scope of scheme for the purpose of qualification for acceptance and clause 1.1(e) of the Scheme further provides that all returns filed by the Tax Payers shall be eligible in case of persons not being companies, where tax payable on income declared is higher by 20% or more of the tax payable on the income last declared or assessed which is higher, however, situation will be changed due to application of "Note" appended to clause 1.1 which without any" shadow of doubt clarify and support the version of the assessee that the condition regarding percentage increase to tax shall not be applicable if income consists of or includes salary and such income constitutes more; than 50% of the total income declared for the year. In the circumstances, the learned DCIT mercilessly failed to appreciate that the percentage of salary income at Rs.168,000 constitutes more than 50% of total income such the condition of tax to be higher by 20% is not applicable in case of assessee by virtue of "Note", appended to clause 1.1(e) and 1.2 of the Scheme (Circular No. 4 of 2001). Apart from, this, clause (7) of the Scheme provides the details of cases where returns! would be ineligible for the purpose of accepting the claim under Self Assessment Scheme whereas the assessee's case does not fall within any of the sub‑clause of clause (7), hence not only return is eligible for; all the purpose but also fit for acceptance under the scheme by virtue of "Note" appended to clause 1.1(e)

10. In the circumstances supra, the process of return under normal law and order of the learned CIT(A) approving the treatment given by the learned CIT(A), Hyderabad, warrants interference being illegal, unjustified and contrary to law as well provisions of Self‑Assessment Scheme, for the assessment year 2001‑2002. As a result thereof, two orders below stand annulled.

11. Consequently, the Assessing Officer is directed to accept the claim of the assessee under Self‑Assessment Scheme. C.M.A./48/Tax (Trib.) Appeal accepted.