Income-tax---

----High Court judgment---Suspension of operation of High Court judgment-- Profits and gains from business of trading in certain goods---Computation of-- Stay of judgment of High Court in A. Sanyasi Rao v. Government of A:P. (1989) 178 ITR 31 (AP)---As a result of judgment of High Court, Department unable to complete assessments involving application of section 44-AC-- Assessments bound to get time-barred---Department permitted to complete assessments of assesses involving cases under section 44-AC irrespective of observations of High Court regarding limited operation of section 44-AC-- Indian Income Tax Act, 1961, S.44-AC.

The Supreme Court suspended the operation of the Andhra Pradesh High Court judgment in A. Sanyasi Rao v. Government of A.P. (1989) 178 ITR 31 because as a result of the judgment of the High Court, the Department was unable to complete assessments involving the application of section 44-AC of the Income Tax Act, 1961, and the assessments were getting time-barred. The Department was allowed to complete the assessments of assessees involving cases under section 44-AC of the Income Tax Act, 1961, irrespective of the observations of the High Court regarding the limited operation of section 44-AC.

Sanyasi Rao (A.) v. Government of A.P. (1989) 178 ITR 31(AP) ref.

Dr. V. Gaurishankar, Senior Advocate (S. Rajappa, Ms. A. Subhashini and P. Parameshwaran, Advocate with him) for the Petitioners.

ORDER

S. RANGANATHAN, J.---IA. Nos. 1-105: Issues notice to the respondent returnable in eight weeks. .

Pending further orders, we suspend the operation of the High Court's judgment under appeal with the result that the Department will be free to complete assessments of the various assessees concerned without being bound by the High Court's observations regarding the limited operation of that section.

S.L.P. (C) Nos. 3944-4087 of 1992 and IA. No. 1-74 of 1992 in S.L.P. (C) of 1992:

It has been mentioned on behalf of the Union of India that these S.L.Ps. have been filed by the Union of India against the judgments of the Orissa and Punjab and Haryana High Courts following the decision of the Andhra Pradesh High Court in A. Sanyasi Rao v. Government of A.P. (1989) 178 ITR 31, which is the subject-matter of CA Nos. 4290-4394 of 1989. These S.LPs, have not yet been listed and one batch is also out of time.

These S.L.Ps. are taken on board. Issue notice to the respondents returnable in eight weeks.

In the meantime, it is mentioned on behalf of the Union of India that as a result of the High Court judgment, the Department is unable to complete assessments involving the application of section 44-AC and that these assessments are bound to be time-barred today, i.e. March 31, 1992. It is, therefore, prayed that there should be an interim order of suspension of the operation of the judgment of the High Court.

In the meantime, following our directions in I. As. Nos. 1 to 105 in C.As. Nos. 4290-4394 of 1989, we direct that there- shall be a stay of operation of the impugned judgments. The effect of it will be to permit the Department to complete assessments involving cases under section 44-AC irrespective of the observations in the judgments of the High Court of limited applicability of these sections.

M.BA./38/T.FReference answered.