Assistant Commissioner of Income Vs. Sri Ranganatha Traders - Court Judgment

Excerpt:
1. these appeals are filed by the revenue against the order of the cit(a)-ii, hyderabad, dt. 25th feb., 2000 and 28th feb., 2000, for asst. yrs. 1991-92 and 1992-93. the effective grounds of appeal read as under: "2. the tribunal set aside the assessment and to determine the income as per provisions of sections 28 to 43c of the act. the cit(a) erred in holding that the unexplained cash credits cannot be considered in view of the tribunal's directions to compute the income as per provisions of sections 28 to 43c. 3. once the books of account are taken up for examination, it is part of the proceedings to compute the income under 'other sources', i.e., unexplained cash credits." for the sake of convenience, these appeals are disposed of by a common order as common issues are involved. brief facts of the case are as follows.2. the assessee is constituted as a partnership firm and it obtained licence for the sale of arrack for 128 shops in hyderabad and secunderabad, for the excise year 1990-91, i.e., 1st oct., 1990 to 30th sept., 1991. originally, the licence for sale of arrack was obtained by 9 partners, viz., (1) m. raj kumar, (2) balanarasaiah, (3) d.p.narayana swamy, (4) r. srinivas, (5) m. narayana goud, (6) m. srinivas, (7) a. rajender reddy, (8) t. ashok kumar and (9) m. ravinder goud, under the name and style of m/s raj kumar & others. later on, three financing partners were included, viz., (1) t. subhash goud, (2) s.manohar and (3) k. venkatesh. these persons formed a partnership under the name and style of m/s sri ranganatha traders, under partnership deed executed on 27th nov., 1990. this firm filed its return of income for the asst. yr. 1991-92 on 30th march, 1992, declaring taxable income of rs. 9,07,920. the ao applied the provisions of section 44ac of the it act, 1961, and determined the taxable income at rs. 89,78,800 in the assessment made on 30th march, 1994, under section 143(3) of the act.the ao also granted registration to the assessee-firm under section 185(1) of the act, while completing the assessment under section 143(3).3. the assessee-firm preferred an appeal against the assessment order passed under section 143(3) on 30th march, 1994, on the issue of application of provisions of section 44ac of the act. the learned cit(a)-v, hyderabad, confirmed the assessment stating that the hon'ble supreme court had stayed the operation of the judgment of the hon'ble andhra pradesh high court in the case of a. sanyasi rao and ors. v.union of india and anr. (1989) 178 itr 31 (ap) on further appeal by the assessee, the tribunal, hyderabad bench 'b', vide order dt. 12th aug., 1996, in ita nos. 1177 & 1178/hyd/1996 (and other cases), followed the judgment of the hon'ble supreme court in the case of union of india v.a. sanyasi rao and ors. "respectfully following the abovementioned decision of hon'ble supreme court, we set aside the orders of the first appellate authorities and restore the matters to the files of the ao for determining the income as per the provisions of sections 28 to 43c of it act." 4. during the course of the fresh assessment proceedings in pursuance of the order of the tribunal, the ao cancelled the registration granted to the firm and determined the status of the assessee as aop by following the decision of the hon'ble supreme court in the case of biharilal jaiswal v. cit (1996) 217 itr 746 (sc). the assessee had not carried this issue in appeal.5. the ao sought to enquire into the cash credits being investment made by the members of the aop, during the fresh assessment proceedings. she directed the assessee to furnish complete names and addresses of the members of the aop along with details of their gir numbers and copies of returns of income for the asst. yrs. 1990-91 and 1991-92 along with their sources of income. the assessee took a stand that all the details sought for had been filed during the original assessment proceedings and that the ao, during the original assessment proceedings, in his order dt. 30th march, 1994, had specifically stated : "capital investment of partners filed considered." and that no addition had been made in the original assessment on account of cash credits and that fresh enquiry into the issue of genuineness of the credits, when already a considered view had been taken on the same in the original assessment proceedings, was not called for. the assessee further argued that the direction of the tribunal to the ao was to determine the income as per the provisions of sections 28 to 43c of the act, that this direction is specific and that the ao should not rake up other issues, which had attained finality in the original assessment order.the assessee relied on a number of decisions in support of its arguments. the ao relied on the decision of the hon'ble rajasthan high court in the case of rambilas chandram v. cit (1985) 156 itr 344 (raj).in that case, reliance was placed on the decision of the hon'ble allahabad high court in j.k. cotton spg. & wvg. mills co. ltd. v. cit (1963) 47 itr 906 (all), wherein it was held that there were no restrictions at all on the powers of the ito when he proceeds to reassess the income, subject to the directions given by the aac and that the ito is not bound or restricted by anything that had happened either when he made the original assessment or when the appeal was heard by the aac; that he is not bound by his own findings arrived at in the original assessment; they do not operate as res judicata. the ito is free to take into consideration any relevant material that came into existence for the first time after the original assessment order was made by him. stating that the assessments were set aside by the tribunal with specific direction to determine the income as per the provisions of sections 28 to 43c in this case, the ao held that it is to be interpreted in the light of the fact that the original assessment was completed by applying the provisions of section 44c. she relied on a number of case law and on the ground that despite several opportunities, the assessee had not discharged the onus of proving the creditworthiness and genuineness of the transactions regarding the monies introduced by the members of the aop and that mere filing of routine confirmation letters, some of which did not even bear the gir numbers or source of income, does not discharge the onus of proving the transactions to the satisfaction of the ao, made an addition of rs. 1,41,80,000 being capital introduced by shri d.p. narayanaswamy, shri r. srinivas, shri a. rajender reddy and shri t. subhash goud. she also estimated the net profit @ 15 per cent of the purchase price by rejecting the books of account.6. the assessee carried the matter in appeal before the cit(a)-ii, hyderabad, and disputed both the addition on account of cash credits and the estimation of income at 15 per cent of the purchase price. it reiterated its contention that the directions of the tribunal are specific and clear directions and that the ao had travelled beyond her jurisdiction by enquiring into the merits of the cash credits already accepted by the ao in the original assessment. it further submitted that without prejudice to its legal contentions, the addition under section 68 in respect of the investments made by the partners is not correct in law as all the partners had made investments of the sums through banking channels and they had confirmed their investments and the partners are assessed to tax and that all this information had been filed during the original assessment proceedings. as already stated, the assessee had not disputed the rejection of its claim for status as partnership firm. the learned cit(a), while upholding the estimation of income by rejection of books of account at 15 per cent of the purchase price, held that the directions given by the tribunal were specific directions and there was no scope for the ao to travel beyond those directions. he held that the ao travelled beyond the limits for adding the cash credits and that she should have determined the income of the firm as per the provisions of sections 28 to 43c. he relied on the following case laws :smt. meenakshi khosla v. ito (1991) 39 ttj (del) 555 : (1991) 36 itd 400 (del) and other decisions.7. shri k.v. chowdary, learned departmental representative (cit), submitted that section 143(3) does not restrict the power of the ao while doing a fresh assessment. he took this bench through the order of the tribunal, dt. 12th aug., 1996, and submitted that the judgment of the hon'ble supreme court in the case of union of india v. a. sanyasi rao and ors. (supra) was applied by the bench and the ao was directed to recomputed the income in accordance with sections 28 to 43c of the act. he submitted that this direction cannot be considered as a specific direction and that the entire assessment was set aside for consideration by the ao. thus, he argued that it is an open remand and that the ao had every right to enquiry into cash credits and other issues and that it was the duty of the assessee to furnish the required information as called for by the assessing authority and satisfy the ao as to the genuineness of the credit. he relied on the judgment of the hon'ble supreme court in the case of kale khan mohammad hanif v. cit (1963) 50 itr 1 (sc) and submitted that it is well-settled that the amount of cash credit should be assessed to tax as income from undisclosed sources in addition to the business income computed by estimate. he specifically pointed out that the assessee had not contested the change of status from that of registered firm to aop by the ao. he argued that while one aspect of the assessment was not challenged by the assessee, the other aspect of reexamination of credits was being challenged. he submitted that the cit(a) has erred infolding that the ao travelled beyond her limits by adding the four cash credits while there is a clear and specific direction by the tribunal to determine the income of the assessee as per the provisions of sections 28 to 43c. he relied on the following case law in support of his contention that once an assessment is set aside, it is open to the ao to consider the entire matter afresh and that the jurisdiction of the ao cannot be restricted once the assessment is set aside and remitted back to him : (ii) abhai ram gopi nath v. cit (1971) 79 itr 339 (all) which was followed in cit v. seth manicklal fomra (by lr's) (1975) 99 itr 470 (mad) 8. shri p. murali krishna, learned counsellor the assessee, on the other hand, filed a paper book consisting of pp. 1 to 51 and submitted that during the original assessment proceedings the assessee had filed trading account, p&l a/c and balance sheet as well as extract of capital account. he drew the attention of the bench to the paper book at pp, 11 to 44 and submitted that each of the partners, who were subsequently treated as members of the aop, had confirmed the investment by way of a letter, as well as the mode of remittance of the money. he took this bench through each of the papers to submit that account copies as appearing in the books of the partners were filed before the ao and the assessment details, etc. were also placed on record. he submitted that all the partners who had contributed capital are assessed to tax and the ao in the original assessment proceedings had, based on these detailed documents, come to the conclusion that no addition was called for under section 68 of the act, while estimating the income of the assessee under section 44ac. he specifically drew the attention of the bench to the wording in the original assessment order, i.e., "capital investment of partners filed considered" and submitted that on consideration the ao had decided that no addition was called for under section 68 of the act. he drew the attention of the bench to the order of the tribunal, dt. 12th aug., 1996, and submitted that a specific direction was given to the ao for determining the income as per the provisions of sections 28 to 43c of the act.9. the learned counsel vehemently contended that the ao cannot go beyond the direction of the tribunal and should confine himself to determining the income as per the provisions of sections 28 to 43c of the act. he submitted that the ao wrongly relied upon the decision of the hon'ble rajasthan high court in the case of rambilas chandram (supra) and that when a remand is made with certain specific directions, the ao is bound by such directions and the case law does not lay down that when a specific remand is made, the ao can re-examine all the matters without limitation of jurisdiction.10. the learned counsel further contended that there is a difference between remanding and setting aside the assessment by the first appellate authority, i.e., the cit(a) and the second appellate authority, i.e., the tribunal. as per section 251 of the act, he submits, the first appellate authority can examine all the matters covered by the assessment order and correct the assessment order in respect of such matters even to the prejudice of the assessee; he may remand the case to the ao for enquiring into matters which were not subject-matter of appeal also and set aside the assessment and remand the case to the ao for making a fresh assessment and the ao's powers while making the fresh assessment are the same as if he were making an original assessment. in cases where the first appellate authority limits the power of the ao by giving specific direction, he submits, the scope of enquiry by the ao is restricted.11. the learned counsel vehemently contended that when a remand is made by the second appellate authority, i.e., the tribunal, the position is quite difference, as the powers of the tribunal are confined to the subject-matter of appeal before it, as constituted by the original grounds of appeal, and such additional grounds as may be raised by leave of the tribunal. thus, he argues that when the tribunal allows the appeal and set aside the assessment and remands the case for making a fresh assessment, the powers of the ao are confined to the subject-matter only. he contends that the ao cannot take up questions which were not subject-matter of appeal before the tribunal and that this would be so even if no specific directions were given and there is no scope whatsoever for the ao to travel beyond such jurisdiction.12. the learned counsel supported the order of the first appellate authority and reiterated his contention that the capitals introduced by the partners were accepted in the original assessment and they were never subject-matter of appeal either before the first appellate authority or before the second appellate authority. he submitted that in case the revenue was of the opinion that an erroneous decision had been taken by the ao while making the original assessment order, then remedy lay by way of invocation of powers under section 263 or reopening of assessment under section 147 and not otherwise. he reiterated that the judgment of the hon'ble rajasthan high court in the case of rambilas chandram (supra) states that if the remand is subject to directions, then the ao is bound by such directions. he relied on the following case law :union of india v. kamalakshi finance corporation ltd. air 1992 sc 711; and other decisions.13. we have heard rival contentions. before we go into the details of the issue, we deem it proper to extract the order of the tribunal, dt.12th aug., 1996, based on which the ao made the reassessment: "4. we find that the point at issue has been decided by the supreme court in the case of union of india and anr. v. a. sanyasi rao and ors. (1996) 219 itr 330 (sc), wherein the hon'ble supreme court held in the concluding para which reads as follows : 'we perused the aforesaid judgment of the andhra pradesh high court with care and we hold that in view of the absence of materials, the court was justified in its view that the remedy specified by section 44ac is disproportionate to the evil that prevailed and so to the extent the non obstante clause in section 44ac excluded the provisions of sections 28 to 43c (applicable to all assessees), the provisions are unreasonable. we concur with the aforesaid conclusion of the andhra pradesh high court on this aspect and hold that section 44ac is a valid piece of legislation and is an adjunct to and explanatory to section 206c. it does not dispense with the regular assessment as provided in accordance with sections 28 to 43c of the act. a direction will issue to that effect and to this limited extent the writ petitions filed by the assessees shall stand partly allowed. in all other respects the batch of cases shall stand dismissed. respectfully following the abovementioned decision of hon'ble supreme court, we set aside the orders of the first appellate authorities and restore the matters to the files of the ao for determining the income as per the provisions of sections 28 to 43c of it act." "in response to notice under section 143(2), sri amarnath, chartered accountant, and authorised representative of the assessee appeared and discussed the case. the assessee-firm has carried out arrack business during the asst. yr. 1991-92 and admitted net income of rs. 9,07,920 on total purchases of rs. 2,24,46,999 and sales of rs, 10,07,34,500. books of account produced examined. capital investment of partners filed considered. this is a case of application of provisions of section 44ac of the it act and income is fixed at rs. 89,78,000 which is 40 per cent of the purchase price admitted by the assessee, the assessment is finalised accordingly." 15. in the case of j.k. cotton spg. & wvg. mills co. ltd. (supra), hon'ble allahabad high court held that there are no restrictions at all on the powers of the ito when he proceeds to make a fresh assessment, for the fresh assessment is nothing but a second assessment in substitution of the one set aside. he has to proceed as if he were making an original assessment under section 23 (of the indian it act, 1922). he is not bound or restricted by anything that had happened either when he made the original assessment or when the appeal was heard. he is not bound by his own findings arrived at in the original assessment. nor is he confined to those materials which existed on the date of the original assessment order. he is free to take into consideration any relevant material that came into existence for the first time after the original assessment order was made by him. in that case, the aac had set aside the assessments on appeal and directed the ito to make fresh assessments. it was held that there were no fetters placed by the aac on the ito.16. in the case of abhai ram gopi nath v. cit (1971) 79 itr 339 (all), decided by the hon'ble allahabad high court, the decision in the case of j.k. cotton spg. & wvg. mills co. ltd. (supra) was followed. the court distinguished the judgment in the case of chhittarmal narain das v. cit (1969) 24 stc 451 (all), on the ground that in that case the remand order was expressly for checking the calculations and that in this case the aac set aside the assessment and directed the ito to make a fresh assessment. in this case as well as in the case of j.k. cotton spg. & wvg. mills co. ltd. (supra), it should be observed that no restrictions at all were placed by the first appellate authority on the powers of the ao and, on the contrary, a specific direction was given to make a fresh assessment.17. in the case of cit v. seth manicklal forma (supra), hon'ble madras high court held that once an assessment is set aside by the aac, the ito can consider the entire matter afresh notwithstanding the terms of the order of the aac directing the officer to consider the issue relating to the estimation of income alone. in this case, the court held that on facts it was unable to read the order of the aac as in any way limiting the scope of the ito to make a fresh assessment order.while saying so, it was held as follows : "once an order of assessment is set aside, it is open to the ito to consider the entire matter afresh and neither the order of the aac in terms restricts the ito to consider the issue relating to the estimation of the income alone nor there is any warrant for reading such a restriction of the power either under section 251(1)(a) or under section 143(3) under which the ito makes a fresh assessment." the court doubted the power of the aac to restrict the power of the ito while setting aside the assessment order. they also held that "once an order of assessment is set aside and the matter comes up for fresh assessment before the ito, we are of opinion that the powers will have to be decided with reference to the provisions under section 143(3) and not with reference to any observations made by the aac in his order or with reference to the scope of the appeal before the aac". the court followed the judgment of hon'ble allahabad high court in the case of j.k. cotton spg. & wvg. mills co. ltd. (supra) and distinguished the judgment of the hon'ble andhra pradesh high court in the case of pulipati subbarao & co. (supra).18. in the case of cit v. buildwell assam (p) ltd. (supra), hon'ble gauhati high court upheld the action of the ito of disallowing wholly the claim of the assessee under sections 80-i and 80j in the fresh assessment, which had been partly allowed in the original assessment order. it was held that the deductions under sections 80-1 and 80j were only considered but never finally decided by the aac and in the absence of a positive decision, the ito was entitled to go into the issue while making the fresh assessment. in other words, it was held that the issue had not attained finality through the order of the aac and hence the ito had jurisdiction to consider and decide the question when the matter was sent to him for making a fresh assessment.19. in the case of s.p. kochhar v. ito (supra), hon'ble allahabad high court dealt with the powers of the aac and the tribunal. it held that the powers of the aac are wider than those of the tribunal and that when the matter is remanded to the ito by the tribunal, the power of the ito is confined to the subject-matter of appeal before the tribunal. at p. 262 of the report, it was held as follows : "what thus comes out is that the powers of the aac are wider than those of the tribunal. the aac while hearing an appeal under section 251 of the act can examine all matters covered by the assessment order and correct the assessment in respect of all such matters even to the prejudice of the assessee. he may remand the case to the ito for enquiring into the items which were not the subject-matter of appeal also. if he sets aside an assessment and remands the case to the ito for making a fresh assessment, the powers of the ito while making the fresh assessment are the same as if he were making an original assessment under section 143(3) of the act. the aac can, however, limit the powers of the ito by giving suitable directions in regard to the scope of enquiry by the ito. in the absence of such direction or restriction on the power of the ito, while making a fresh assessment, the ito is not bound by anything that had happened either when he made the original assessment or when the appeal was heard. when the remand is made by the tribunal the position is ' different. the powers of the tribunal are confined to the subject-matter of appeal as constituted by the original grounds of appeal and such additional grounds as may be raised by the leave of the tribunal. thus, when the tribunal allows the appeal and sets aside the assessment and remands the case for making a fresh assessment, the power of the ito is confined to such subject-matter only. he cannot take up the questions which were not the subject-matter of appeal before the tribunal. this will be so even though no specific direction has been given by the tribunal. if a specific direction is given, then there is no scope whatsoever for the ito to travel beyond those directions or restrictions." 20. in the case of rambilas chanram v. cit (supra), hon'ble rajasthan high court dealt with setting aside of an assessment by an aac. in that case, the assessment was set aside by the aac with a direction to make a fresh assessment. the decision in the case of j.k. cotton spg. & wvg.mills co. ltd. (supra) was applied and the hon'ble high court held that where a case is sent back to the ito without any restrictions, there are no restrictions at all on the powers of the ito when he proceeds to make the fresh assessment in substitution of the one set aside.21. in the case of cit v. sun engineering works (p) ltd. (1992) 198 itr 297 (sc), the hon'ble supreme court was dealing with the scope of reassessment and not the case of a set aside assessment. it held that it was not open for the assessee to seek review of concluded items unconnected with the escapement of assessment for the purpose of computation of income in the reassessment.22. in the case of cit v. d. veerappan (supra), hon'ble madras high court followed the judgment in the case of cit v. seth manicklal fomra (supra) and held that once an assessment is set aside, it is open to the ito to consider the entire matter afresh, notwithstanding the terms of the first appellate authority. in this case, the tribunal had directed the ito not to increase the income beyond what was determined by the aac in the appeal proceedings. the hon'ble high court held that once an assessment is set aside, the tribunal cannot restrict the powers of the ito while remitting the matter for redoing the assessment afresh.23. in the case of murlidhar bhagwandas v. cit (1998) 234 itr 548 (bom), hon'ble bombay high court held that in proceedings before the ito for making fresh assessment pursuant to the directions contained in an appellate order, only such issues can be agitated which have not attained finality. the court was dealing with a case where the assessee had not challenged the order of the first appellate authority upholding the validity of the reassessment proceedings under section 147(a) while setting aside the issue of examination of hundi loans. the court held that the issue of validity of reopening had attained finality in the order of the first appellate authority and the assessee cannot reagitate the same.24. in the case of kunal engineering co. ltd. v. cit (2000) 241 itr 340 (mad), hon'ble madras high court followed the judgment of the hon'ble supreme court in the case of sun engineering works (p) ltd. (supra).25. reverting to the facts of the case on hand, we find that the ao during the original assessment proceedings, had examined the books of account as well as the capital investments of the partners. he considered the issue and did not make any addition under section 68 of the act. from the details furnished before the ao in the original assessment proceedings, we find that the assessee had filed confirmation letters, income-tax details, account copies, etc. a plain look at these details furnished would show that the ao, during the original assessment proceedings, had taken a considered view that no addition need be made under section 68 of the act. it is not a case of negligence or mistake. the learned cit(a) at para 5.1 on p. 9 of his order for asst. yr. 1991-92, held as follows : "5.1 further, it is seen from the original assessment order that the ao has mentioned therein that "books of account produced examined. capital investment of partners filed considered". from the above it can be said that the former ao has satisfied himself about the capital contributions made by the partners into the firms after verifying the confirmation letters filed by them explaining the sources. therefore, the action of the present ao, once again taking up examination of these credits, is not justified, since the tribunal has given a clear direction to determine the income of the appellant as per the provisions of sections 28 to 43c." we agree with this finding for the reason that the quality of evidence produced before the ao in the original assessment proceedings, as already stated, is such that it included income-tax details of the parties in whose names the credits had been made in the books of account along with their confirmations, account statements, etc. it is well-settled that the power of review is not available to the ao. on the same set of facts and information without any new material being brought on record, it is not open for the ao to take a different view.if it were the case of the revenue that the ao in the original assessment proceedings had made a mistake then, it would be a case for reopening the assessment under section 147 or for invoking of the powers of the cit under section 263, on the ground that the decision was erroneous and prejudicial to the interests of revenue. the ao cannot review his predecessor's decision. as it is a considered view taken by the ao in the original assessment proceedings, it is not open for the ao to call for information and take a contrary view in the absence of any independent fresh material coming to light. we view the issue from the angle as to whether the second ao can take a different view from that taken by the first ao on the same set of facts. this, to our mind, is not permissible as it is tantamount to review. in this view of the matter, the order of the learned cit(a) has to be upheld.26. going by the legal propositions culled out in the previous paragraphs, we find that in most of the cases a set aside order of the first appellate authority was the only issue. it is only in the case of s.p. kochhar (supra) the hon'ble allahabad high court laid down the law applicable to a matter set aside by the tribunal. this case law is in favour of the assessee. even otherwise, when appeals are taken at different levels, the issues get crystallised and when issues are remanded, the subject of controversy should be limited to issue in question, especially when there is no fresh material on record. all proceedings under the act have to attain finality. we are inclined to apply the view of the hon'ble allahabad high court in the case of s.p.kochhar (supra) for the reason that it is in line with the propositions approved by the apex court in the case of radhasoami satsang v. cit (1992) 193 itr 321 at 328 and 329 (sc). hon'ble supreme court in that case observed : "one of the decisions referred to by the full bench was the case of hoystead v. commissioner of taxation (1926) ac 155 (pc). speaking for the judicial committee, lord shaw stated (p. 165) : 'parties are not permitted to begin fresh litigations because of new views they may entertain of the law of the case, or new versions which they present as to what should be a proper apprehension by the court of the legal result either of the construction of the documents or the weight of certain circumstances. if this were permitted litigation would have no end, except when legal ingenuity is exhausted, it is a principle of law that this cannot be permitted and there is abundant authority reiterating that principle. thirdly, the same principle, namely, that of a setting to rest rights of litigants, applies to the case where a point, fundamental to the decision, taken or assumed by the plaintiff and traversable by the defendant, has not been traversed. in that case also, a defendant is bound by the judgment, although it may be true enough that subsequent light on ingenuity might suggest some traverse which had not been taken.' these observations were made in the case where taxation was in issue. this court in parashuram pottery works co. ltd. v. ito (1977) 106 itr 1 (sc) at p. 10 stated : 'at the same time, we have to bear in mind that the policy of law is that there must be a point of finality in all legal proceedings, that stale issues should not be reactivated beyond a particular stage and that lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity.' assessments are certainly quasi-judicial and these observations equally apply." 27. thus, we uphold the order of the learned cit(a) by applying the judgments in the cases of s.p. kochhar (supra) and radhasoami satsang (supra) and we feel it is not right at this length of time to accede to the request of the learned departmental representative (cit) to remand the matter for fresh consideration.28. in the result, the orders of the cit(a) are upheld and the appeals of the revenue are dismissed.

Judgment:
1. These appeals are filed by the Revenue against the order of the CIT(A)-II, Hyderabad, dt. 25th Feb., 2000 and 28th Feb., 2000, for asst. yrs. 1991-92 and 1992-93. The effective grounds of appeal read as under: "2. The Tribunal set aside the assessment and to determine the income as per provisions of Sections 28 to 43C of the Act. The CIT(A) erred in holding that the unexplained cash credits cannot be considered in view of the Tribunal's directions to compute the income as per provisions of Sections 28 to 43C. 3. Once the books of account are taken up for examination, it is part of the proceedings to compute the income under 'other sources', i.e., unexplained cash credits." For the sake of convenience, these appeals are disposed of by a common order as common issues are involved. Brief facts of the case are as follows.

2. The assessee is constituted as a partnership firm and it obtained licence for the sale of arrack for 128 shops in Hyderabad and Secunderabad, for the excise year 1990-91, i.e., 1st Oct., 1990 to 30th Sept., 1991. Originally, the licence for sale of arrack was obtained by 9 partners, viz., (1) M. Raj Kumar, (2) Balanarasaiah, (3) D.P.Narayana Swamy, (4) R. Srinivas, (5) M. Narayana Goud, (6) M. Srinivas, (7) A. Rajender Reddy, (8) T. Ashok Kumar and (9) M. Ravinder Goud, under the name and style of M/s Raj Kumar & Others. Later on, three financing partners were included, viz., (1) T. Subhash Goud, (2) S.Manohar and (3) K. Venkatesh. These persons formed a partnership under the name and style of M/s Sri Ranganatha Traders, under partnership deed executed on 27th Nov., 1990. This firm filed its return of income for the asst. yr. 1991-92 on 30th March, 1992, declaring taxable income of Rs. 9,07,920. The AO applied the provisions of Section 44AC of the IT Act, 1961, and determined the taxable income at Rs. 89,78,800 in the assessment made on 30th March, 1994, under Section 143(3) of the Act.

The AO also granted registration to the assessee-firm under Section 185(1) of the Act, while completing the assessment under Section 143(3).

3. The assessee-firm preferred an appeal against the assessment order passed under Section 143(3) on 30th March, 1994, on the issue of application of provisions of Section 44AC of the Act. The learned CIT(A)-V, Hyderabad, confirmed the assessment stating that the Hon'ble Supreme Court had stayed the operation of the judgment of the Hon'ble Andhra Pradesh High Court in the case of A. Sanyasi Rao and Ors. v.Union of India and Anr. (1989) 178 ITR 31 (AP) On further appeal by the assessee, the Tribunal, Hyderabad Bench 'B', vide order dt. 12th Aug., 1996, in ITA Nos. 1177 & 1178/Hyd/1996 (and other cases), followed the judgment of the Hon'ble Supreme Court in the case of Union of India v.A. Sanyasi Rao and Ors.

"Respectfully following the abovementioned decision of Hon'ble Supreme Court, we set aside the orders of the first appellate authorities and restore the matters to the files of the AO for determining the income as per the provisions of Sections 28 to 43C of IT Act." 4. During the course of the fresh assessment proceedings in pursuance of the order of the Tribunal, the AO cancelled the registration granted to the firm and determined the status of the assessee as AOP by following the decision of the Hon'ble Supreme Court in the case of Biharilal Jaiswal v. CIT (1996) 217 ITR 746 (SC). The assessee had not carried this issue in appeal.

5. The AO sought to enquire into the cash credits being investment made by the members of the AOP, during the fresh assessment proceedings. She directed the assessee to furnish complete names and addresses of the members of the AOP along with details of their GIR numbers and copies of returns of income for the asst. yrs. 1990-91 and 1991-92 along with their sources of income. The assessee took a stand that all the details sought for had been filed during the original assessment proceedings and that the AO, during the original assessment proceedings, in his order dt. 30th March, 1994, had specifically stated : "Capital investment of partners filed considered." and that no addition had been made in the original assessment on account of cash credits and that fresh enquiry into the issue of genuineness of the credits, when already a considered view had been taken on the same in the original assessment proceedings, was not called for. The assessee further argued that the direction of the Tribunal to the AO was to determine the income as per the provisions of Sections 28 to 43C of the Act, that this direction is specific and that the AO should not rake up other issues, which had attained finality in the original assessment order.

The assessee relied on a number of decisions in support of its arguments. The AO relied on the decision of the Hon'ble Rajasthan High Court in the case of Rambilas Chandram v. CIT (1985) 156 ITR 344 (Raj).

In that case, reliance was placed on the decision of the Hon'ble Allahabad High Court in J.K. Cotton Spg. & Wvg. Mills Co. Ltd. v. CIT (1963) 47 ITR 906 (All), wherein it was held that there were no restrictions at all on the powers of the ITO when he proceeds to reassess the income, subject to the directions given by the AAC and that the ITO is not bound or restricted by anything that had happened either when he made the original assessment or when the appeal was heard by the AAC; that he is not bound by his own findings arrived at in the original assessment; they do not operate as res judicata. The ITO is free to take into consideration any relevant material that came into existence for the first time after the original assessment order was made by him. Stating that the assessments were set aside by the Tribunal with specific direction to determine the income as per the provisions of Sections 28 to 43C in this case, the AO held that it is to be interpreted in the light of the fact that the original assessment was completed by applying the provisions of Section 44C. She relied on a number of case law and on the ground that despite several opportunities, the assessee had not discharged the onus of proving the creditworthiness and genuineness of the transactions regarding the monies introduced by the members of the AOP and that mere filing of routine confirmation letters, some of which did not even bear the GIR numbers or source of income, does not discharge the onus of proving the transactions to the satisfaction of the AO, made an addition of Rs. 1,41,80,000 being capital introduced by Shri D.P. Narayanaswamy, Shri R. Srinivas, Shri A. Rajender Reddy and Shri T. Subhash Goud. She also estimated the net profit @ 15 per cent of the purchase price by rejecting the books of account.

6. The assessee carried the matter in appeal before the CIT(A)-II, Hyderabad, and disputed both the addition on account of cash credits and the estimation of income at 15 per cent of the purchase price. It reiterated its contention that the directions of the Tribunal are specific and clear directions and that the AO had travelled beyond her jurisdiction by enquiring into the merits of the cash credits already accepted by the AO in the original assessment. It further submitted that without prejudice to its legal contentions, the addition under Section 68 in respect of the investments made by the partners is not correct in law as all the partners had made investments of the sums through banking channels and they had confirmed their investments and the partners are assessed to tax and that all this information had been filed during the original assessment proceedings. As already stated, the assessee had not disputed the rejection of its claim for status as partnership firm. The learned CIT(A), while upholding the estimation of income by rejection of books of account at 15 per cent of the purchase price, held that the directions given by the Tribunal were specific directions and there was no scope for the AO to travel beyond those directions. He held that the AO travelled beyond the limits for adding the cash credits and that she should have determined the income of the firm as per the provisions of Sections 28 to 43C. He relied on the following case laws :Smt. Meenakshi Khosla v. ITO (1991) 39 TTJ (Del) 555 : (1991) 36 ITD 400 (Del) and other decisions.

7. Shri K.V. Chowdary, learned Departmental Representative (CIT), submitted that Section 143(3) does not restrict the power of the AO while doing a fresh assessment. He took this Bench through the order of the Tribunal, dt. 12th Aug., 1996, and submitted that the judgment of the Hon'ble Supreme Court in the case of Union of India v. A. Sanyasi Rao and Ors. (supra) was applied by the Bench and the AO was directed to recomputed the income in accordance with Sections 28 to 43C of the Act. He submitted that this direction cannot be considered as a specific direction and that the entire assessment was set aside for consideration by the AO. Thus, he argued that it is an open remand and that the AO had every right to enquiry into cash credits and other issues and that it was the duty of the assessee to furnish the required information as called for by the assessing authority and satisfy the AO as to the genuineness of the credit. He relied on the judgment of the Hon'ble Supreme Court in the case of Kale Khan Mohammad Hanif v. CIT (1963) 50 ITR 1 (SC) and submitted that it is well-settled that the amount of cash credit should be assessed to tax as income from undisclosed sources in addition to the business income computed by estimate. He specifically pointed out that the assessee had not contested the change of status from that of registered firm to AOP by the AO. He argued that while one aspect of the assessment was not challenged by the assessee, the other aspect of reexamination of credits was being challenged. He submitted that the CIT(A) has erred infolding that the AO travelled beyond her limits by adding the four cash credits while there is a clear and specific direction by the Tribunal to determine the income of the assessee as per the provisions of Sections 28 to 43C. He relied on the following case law in support of his contention that once an assessment is set aside, it is open to the AO to consider the entire matter afresh and that the jurisdiction of the AO cannot be restricted once the assessment is set aside and remitted back to him : (ii) Abhai Ram Gopi Nath v. CIT (1971) 79 ITR 339 (All) which was followed in CIT v. Seth Manicklal Fomra (By LR's) (1975) 99 ITR 470 (Mad) 8. Shri P. Murali Krishna, learned counsellor the assessee, on the other hand, filed a paper book consisting of pp. 1 to 51 and submitted that during the original assessment proceedings the assessee had filed trading account, P&L a/c and balance sheet as well as extract of capital account. He drew the attention of the Bench to the paper book at pp, 11 to 44 and submitted that each of the partners, who were subsequently treated as members of the AOP, had confirmed the investment by way of a letter, as well as the mode of remittance of the money. He took this Bench through each of the papers to submit that account copies as appearing in the books of the partners were filed before the AO and the assessment details, etc. were also placed on record. He submitted that all the partners who had contributed capital are assessed to tax and the AO in the original assessment proceedings had, based on these detailed documents, come to the conclusion that no addition was called for under Section 68 of the Act, while estimating the income of the assessee under Section 44AC. He specifically drew the attention of the Bench to the wording in the original assessment order, i.e., "Capital investment of partners filed considered" and submitted that on consideration the AO had decided that no addition was called for under Section 68 of the Act. He drew the attention of the Bench to the order of the Tribunal, dt. 12th Aug., 1996, and submitted that a specific direction was given to the AO for determining the income as per the provisions of Sections 28 to 43C of the Act.

9. The learned counsel vehemently contended that the AO cannot go beyond the direction of the Tribunal and should confine himself to determining the income as per the provisions of Sections 28 to 43C of the Act. He submitted that the AO wrongly relied upon the decision of the Hon'ble Rajasthan High Court in the case of Rambilas Chandram (supra) and that when a remand is made with certain specific directions, the AO is bound by such directions and the case law does not lay down that when a specific remand is made, the AO can re-examine all the matters without limitation of jurisdiction.

10. The learned counsel further contended that there is a difference between remanding and setting aside the assessment by the first appellate authority, i.e., the CIT(A) and the second appellate authority, i.e., the Tribunal. As per Section 251 of the Act, he submits, the first appellate authority can examine all the matters covered by the assessment order and correct the assessment order in respect of such matters even to the prejudice of the assessee; he may remand the case to the AO for enquiring into matters which were not subject-matter of appeal also and set aside the assessment and remand the case to the AO for making a fresh assessment and the AO's powers while making the fresh assessment are the same as if he were making an original assessment. In cases where the first appellate authority limits the power of the AO by giving specific direction, he submits, the scope of enquiry by the AO is restricted.

11. The learned counsel vehemently contended that when a remand is made by the second appellate authority, i.e., the Tribunal, the position is quite difference, as the powers of the Tribunal are confined to the subject-matter of appeal before it, as constituted by the original grounds of appeal, and such additional grounds as may be raised by leave of the Tribunal. Thus, he argues that when the Tribunal allows the appeal and set aside the assessment and remands the case for making a fresh assessment, the powers of the AO are confined to the subject-matter only. He contends that the AO cannot take up questions which were not subject-matter of appeal before the Tribunal and that this would be so even if no specific directions were given and there is no scope whatsoever for the AO to travel beyond such jurisdiction.

12. The learned counsel supported the order of the first appellate authority and reiterated his contention that the capitals introduced by the partners were accepted in the original assessment and they were never subject-matter of appeal either before the first appellate authority or before the second appellate authority. He submitted that in case the Revenue was of the opinion that an erroneous decision had been taken by the AO while making the original assessment order, then remedy lay by way of invocation of powers under Section 263 or reopening of assessment under Section 147 and not otherwise. He reiterated that the judgment of the Hon'ble Rajasthan High Court in the case of Rambilas Chandram (supra) states that if the remand is subject to directions, then the AO is bound by such directions. He relied on the following case law :Union of India v. Kamalakshi Finance Corporation Ltd. AIR 1992 SC 711; and other decisions.

13. We have heard rival contentions. Before we go into the details of the issue, we deem it proper to extract the order of the Tribunal, dt.

12th Aug., 1996, based on which the AO made the reassessment: "4. We find that the point at issue has been decided by the Supreme Court in the case of Union of India and Anr. v. A. Sanyasi Rao and Ors. (1996) 219 ITR 330 (SC), wherein the Hon'ble Supreme Court held in the concluding para which reads as follows : 'We perused the aforesaid judgment of the Andhra Pradesh High Court with care and we hold that in view of the absence of materials, the Court was justified in its view that the remedy specified by Section 44AC is disproportionate to the evil that prevailed and so to the extent the non obstante clause in Section 44AC excluded the provisions of Sections 28 to 43C (applicable to all assessees), the provisions are unreasonable. We concur with the aforesaid conclusion of the Andhra Pradesh High Court on this aspect and hold that Section 44AC is a valid piece of legislation and is an adjunct to and explanatory to Section 206C. It does not dispense with the regular assessment as provided in accordance with Sections 28 to 43C of the Act. A direction will issue to that effect and to this limited extent the writ petitions filed by the assessees shall stand partly allowed. In all other respects the batch of cases shall stand dismissed.

Respectfully following the abovementioned decision of Hon'ble Supreme Court, we set aside the orders of the first appellate authorities and restore the matters to the files of the AO for determining the income as per the provisions of Sections 28 to 43C of IT Act." "In response to notice under Section 143(2), Sri Amarnath, chartered accountant, and Authorised Representative of the assessee appeared and discussed the case. The assessee-firm has carried out Arrack business during the asst. yr. 1991-92 and admitted net income of Rs. 9,07,920 on total purchases of Rs. 2,24,46,999 and sales of Rs, 10,07,34,500. Books of account produced examined. Capital investment of partners filed considered. This is a case of application of provisions of Section 44AC of the IT Act and income is fixed at Rs. 89,78,000 which is 40 per cent of the purchase price admitted by the assessee, The assessment is finalised accordingly." 15. In the case of J.K. Cotton Spg. & Wvg. Mills Co. Ltd. (supra), Hon'ble Allahabad High Court held that there are no restrictions at all on the powers of the ITO when he proceeds to make a fresh assessment, for the fresh assessment is nothing but a second assessment in substitution of the one set aside. He has to proceed as if he were making an original assessment under Section 23 (of the Indian IT Act, 1922). He is not bound or restricted by anything that had happened either when he made the original assessment or when the appeal was heard. He is not bound by his own findings arrived at in the original assessment. Nor is he confined to those materials which existed on the date of the original assessment order. He is free to take into consideration any relevant material that came into existence for the first time after the original assessment order was made by him. In that case, the AAC had set aside the assessments on appeal and directed the ITO to make fresh assessments. It was held that there were no fetters placed by the AAC on the ITO.16. In the case of Abhai Ram Gopi Nath v. CIT (1971) 79 ITR 339 (All), decided by the Hon'ble Allahabad High Court, the decision in the case of J.K. Cotton Spg. & Wvg. Mills Co. Ltd. (supra) was followed. The Court distinguished the judgment in the case of Chhittarmal Narain Das v. CIT (1969) 24 STC 451 (All), on the ground that in that case the remand order was expressly for checking the calculations and that in this case the AAC set aside the assessment and directed the ITO to make a fresh assessment. In this case as well as in the case of J.K. Cotton Spg. & Wvg. Mills Co. Ltd. (supra), it should be observed that no restrictions at all were placed by the first appellate authority on the powers of the AO and, on the contrary, a specific direction was given to make a fresh assessment.

17. In the case of CIT v. Seth Manicklal Forma (supra), Hon'ble Madras High Court held that once an assessment is set aside by the AAC, the ITO can consider the entire matter afresh notwithstanding the terms of the order of the AAC directing the officer to consider the issue relating to the estimation of income alone. In this case, the Court held that on facts it was unable to read the order of the AAC as in any way limiting the scope of the ITO to make a fresh assessment order.

While saying so, it was held as follows : "Once an order of assessment is set aside, it is open to the ITO to consider the entire matter afresh and neither the order of the AAC in terms restricts the ITO to consider the issue relating to the estimation of the income alone nor there is any warrant for reading such a restriction of the power either under Section 251(1)(a) or under Section 143(3) under which the ITO makes a fresh assessment." The Court doubted the power of the AAC to restrict the power of the ITO while setting aside the assessment order. They also held that "once an order of assessment is set aside and the matter comes up for fresh assessment before the ITO, we are of opinion that the powers will have to be decided with reference to the provisions under Section 143(3) and not with reference to any observations made by the AAC in his order or with reference to the scope of the appeal before the AAC". The Court followed the judgment of Hon'ble Allahabad High Court in the case of J.K. Cotton Spg. & Wvg. Mills Co. Ltd. (supra) and distinguished the judgment of the Hon'ble Andhra Pradesh High Court in the case of Pulipati Subbarao & Co. (supra).

18. In the case of CIT v. Buildwell Assam (P) Ltd. (supra), Hon'ble Gauhati High Court upheld the action of the ITO of disallowing wholly the claim of the assessee under Sections 80-I and 80J in the fresh assessment, which had been partly allowed in the original assessment order. It was held that the deductions under Sections 80-1 and 80J were only considered but never finally decided by the AAC and in the absence of a positive decision, the ITO was entitled to go into the issue while making the fresh assessment. In other words, it was held that the issue had not attained finality through the order of the AAC and hence the ITO had jurisdiction to consider and decide the question when the matter was sent to him for making a fresh assessment.

19. In the case of S.P. Kochhar v. ITO (supra), Hon'ble Allahabad High Court dealt with the powers of the AAC and the Tribunal. It held that the powers of the AAC are wider than those of the Tribunal and that when the matter is remanded to the ITO by the Tribunal, the power of the ITO is confined to the subject-matter of appeal before the Tribunal. At p. 262 of the report, it was held as follows : "What thus comes out is that the powers of the AAC are wider than those of the Tribunal. The AAC while hearing an appeal under Section 251 of the Act can examine all matters covered by the assessment order and correct the assessment in respect of all such matters even to the prejudice of the assessee. He may remand the case to the ITO for enquiring into the items which were not the subject-matter of appeal also. If he sets aside an assessment and remands the case to the ITO for making a fresh assessment, the powers of the ITO while making the fresh assessment are the same as if he were making an original assessment under Section 143(3) of the Act. The AAC can, however, limit the powers of the ITO by giving suitable directions in regard to the scope of enquiry by the ITO. In the absence of such direction or restriction on the power of the ITO, while making a fresh assessment, the ITO is not bound by anything that had happened either when he made the original assessment or when the appeal was heard. When the remand is made by the Tribunal the position is ' different. The powers of the Tribunal are confined to the subject-matter of appeal as constituted by the original grounds of appeal and such additional grounds as may be raised by the leave of the Tribunal. Thus, when the Tribunal allows the appeal and sets aside the assessment and remands the case for making a fresh assessment, the power of the ITO is confined to such subject-matter only. He cannot take up the questions which were not the subject-matter of appeal before the Tribunal. This will be so even though no specific direction has been given by the Tribunal. If a specific direction is given, then there is no scope whatsoever for the ITO to travel beyond those directions or restrictions." 20. In the case of Rambilas Chanram v. CIT (supra), Hon'ble Rajasthan High Court dealt with setting aside of an assessment by an AAC. In that case, the assessment was set aside by the AAC with a direction to make a fresh assessment. The decision in the case of J.K. Cotton Spg. & Wvg.

Mills Co. Ltd. (supra) was applied and the Hon'ble High Court held that where a case is sent back to the ITO without any restrictions, there are no restrictions at all on the powers of the ITO when he proceeds to make the fresh assessment in substitution of the one set aside.

21. In the case of CIT v. Sun Engineering Works (P) Ltd. (1992) 198 ITR 297 (SC), the Hon'ble Supreme Court was dealing with the scope of reassessment and not the case of a set aside assessment. It held that it was not open for the assessee to seek review of concluded items unconnected with the escapement of assessment for the purpose of computation of income in the reassessment.

22. In the case of CIT v. D. Veerappan (supra), Hon'ble Madras High Court followed the judgment in the case of CIT v. Seth Manicklal Fomra (supra) and held that once an assessment is set aside, it is open to the ITO to consider the entire matter afresh, notwithstanding the terms of the first appellate authority. In this case, the Tribunal had directed the ITO not to increase the income beyond what was determined by the AAC in the appeal proceedings. The Hon'ble High Court held that once an assessment is set aside, the Tribunal cannot restrict the powers of the ITO while remitting the matter for redoing the assessment afresh.

23. In the case of Murlidhar Bhagwandas v. CIT (1998) 234 ITR 548 (Bom), Hon'ble Bombay High Court held that in proceedings before the ITO for making fresh assessment pursuant to the directions contained in an appellate order, only such issues can be agitated which have not attained finality. The Court was dealing with a case where the assessee had not challenged the order of the first appellate authority upholding the validity of the reassessment proceedings under Section 147(a) while setting aside the issue of examination of Hundi loans. The Court held that the issue of validity of reopening had attained finality in the order of the first appellate authority and the assessee cannot reagitate the same.

24. In the case of Kunal Engineering Co. Ltd. v. CIT (2000) 241 ITR 340 (Mad), Hon'ble Madras High Court followed the judgment of the Hon'ble Supreme Court in the case of Sun Engineering Works (P) Ltd. (supra).

25. Reverting to the facts of the case on hand, we find that the AO during the original assessment proceedings, had examined the books of account as well as the capital investments of the partners. He considered the issue and did not make any addition under Section 68 of the Act. From the details furnished before the AO in the original assessment proceedings, we find that the assessee had filed confirmation letters, income-tax details, account copies, etc. A plain look at these details furnished would show that the AO, during the original assessment proceedings, had taken a considered view that no addition need be made under Section 68 of the Act. It is not a case of negligence or mistake. The learned CIT(A) at para 5.1 on p. 9 of his order for asst. yr. 1991-92, held as follows : "5.1 Further, it is seen from the original assessment order that the AO has mentioned therein that "Books of account produced examined.

Capital investment of partners filed considered". From the above it can be said that the former AO has satisfied himself about the capital contributions made by the partners into the firms after verifying the confirmation letters filed by them explaining the sources. Therefore, the action of the present AO, once again taking up examination of these credits, is not justified, since the Tribunal has given a clear direction to determine the income of the appellant as per the provisions of Sections 28 to 43C." We agree with this finding for the reason that the quality of evidence produced before the AO in the original assessment proceedings, as already stated, is such that it included income-tax details of the parties in whose names the credits had been made in the books of account along with their confirmations, account statements, etc. It is well-settled that the power of review is not available to the AO. On the same set of facts and information without any new material being brought on record, it is not open for the AO to take a different view.

If it were the case of the Revenue that the AO in the original assessment proceedings had made a mistake then, it would be a case for reopening the assessment under Section 147 or for invoking of the powers of the CIT under Section 263, on the ground that the decision was erroneous and prejudicial to the interests of Revenue. The AO cannot review his predecessor's decision. As it is a considered view taken by the AO in the original assessment proceedings, it is not open for the AO to call for information and take a contrary view in the absence of any independent fresh material coming to light. We view the issue from the angle as to whether the second AO can take a different view from that taken by the first AO on the same set of facts. This, to our mind, is not permissible as it is tantamount to review. In this view of the matter, the order of the learned CIT(A) has to be upheld.26. Going by the legal propositions culled out in the previous paragraphs, we find that in most of the cases a set aside order of the first appellate authority was the only issue. It is only in the case of S.P. Kochhar (supra) the Hon'ble Allahabad High Court laid down the law applicable to a matter set aside by the Tribunal. This case law is in favour of the assessee. Even otherwise, when appeals are taken at different levels, the issues get crystallised and when issues are remanded, the subject of controversy should be limited to issue in question, especially when there is no fresh material on record. All proceedings under the Act have to attain finality. We are inclined to apply the view of the Hon'ble Allahabad High Court in the case of S.P.Kochhar (supra) for the reason that it is in line with the propositions approved by the apex Court in the case of Radhasoami Satsang v. CIT (1992) 193 ITR 321 at 328 and 329 (SC). Hon'ble Supreme Court in that case observed : "One of the decisions referred to by the Full Bench was the case of Hoystead v. Commissioner of Taxation (1926) AC 155 (PC). Speaking for the Judicial Committee, Lord Shaw stated (p. 165) : 'Parties are not permitted to begin fresh litigations because of new views they may entertain of the law of the case, or new versions which they present as to what should be a proper apprehension by the Court of the legal result either of the construction of the documents or the weight of certain circumstances. If this were permitted litigation would have no end, except when legal ingenuity is exhausted, It is a principle of law that this cannot be permitted and there is abundant authority reiterating that principle. Thirdly, the same principle, namely, that of a setting to rest rights of litigants, applies to the case where a point, fundamental to the decision, taken or assumed by the plaintiff and traversable by the defendant, has not been traversed. In that case also, a defendant is bound by the judgment, although it may be true enough that subsequent light on ingenuity might suggest some traverse which had not been taken.' These observations were made in the case where taxation was in issue.

This Court in Parashuram Pottery Works Co. Ltd. v. ITO (1977) 106 ITR 1 (SC) at p. 10 stated : 'At the same time, we have to bear in mind that the policy of law is that there must be a point of finality in all legal proceedings, that stale issues should not be reactivated beyond a particular stage and that lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity.' Assessments are certainly quasi-judicial and these observations equally apply." 27. Thus, we uphold the order of the learned CIT(A) by applying the judgments in the cases of S.P. Kochhar (supra) and Radhasoami Satsang (supra) and we feel it is not right at this length of time to accede to the request of the learned Departmental Representative (CIT) to remand the matter for fresh consideration.

28. In the result, the orders of the CIT(A) are upheld and the appeals of the Revenue are dismissed.