The court upheld the administrative nature of the direction under Section 142 (2a) and emphasized the assessing officer's discretion in ordering special audit based on the complexity of the accounts and the interest of the Revenue.

( 1 ) THIS writ petition has been filed for quashing the impugned directions and notice dated March 23, 1994 (annexures 5 and 6 to the petition), under Section 142 (2a) of the Income-tax Act, 1961. The petitioner has also prayed for a mandamus restraining respondent No. 1, the Assistant commissioner of Income-tax, Central Circle I, Varanasi, from proceeding in pursuance of the aforesaid directions and notice.

( 2 ) HEARD learned counsel for the parties.

( 3 ) THE petitioner is a company registered under the Indian Companies Act. The petitioner established a vanaspati manufacturing unit at Varanasi. It maintains its account on mercantile basis. For the assessment year 1990-91, the petitioner filed a return under the Income-tax Act on december 31, 1990, declaring a loss of Rs. 24,61,860. Notice under Section 143 (2) of the Act dated June 18, 1991, was served on the petitioner on June 21, 1991. Thereafter also several notices dated July 15, 1991, July 30, 1991, November 7, 1991, November 9, 1992, etc. , were issued to the petitioner asking for various details and making various queries. However, it is alleged in para. 9 of the petition, that at no stage of the assessment proceedings, did respondent no. 1 tell or indicate to the petitioner that the account books of the petitioner were of complex nature and he was finding it difficult to understand, appreciate or apprehend the entries in the account books.

( 4 ) IT is alleged in para. 10 of the petition that during the assessment in question respondent No. 1 examined the account books of the petitioner in detail and formed a full and final opinion in regard to the assessment of the petitioner. Respondent No. 1 assessed the income of the petitioner at Rs. 62,47,993 vide assessment order dated March 24, 1993 (annexure 1 to the petition ). The petitioner filed an appeal to the Commissioner of Income-tax (Appeals), Varanasi on April 20, 1993.

( 5 ) IT is alleged in para. 14 of the petition that the appeal was heard on 5 or 6 dates, and on each of the dates the assessing authority of the petitioner, namely, respondent No. 1 appeared on behalf of the Department. However, at no point of time and at no stage he stated that the account books of the petitioner were of complex nature and there was difficulty in understanding, appreciating and comprehending the entries in the account books.

( 6 ) THE Commissioner of Income-tax (Appeals) by his order dated March 15, 1994, allowed the appeal, set aside the assessment order and remanded the matter to the Assessing Officer for fresh assessment. True copy of the appellate order is annexure 3 to the petition.

( 7 ) IT is alleged in para. 17 of the petition that there is no mention anywhere in the assessment order or appellate order that the account books of the petitioner were of complex nature and there is any difficulty in understanding, appreciating or comprehending the entries in the account books. It is alleged in para. 18 that there is no complexity in the petitioners account nor are they of such nature that there could be any difficulty on the part of respondent No. 1 to understand, appreciate or comprehend the same. However, on March 24, 1994, the petitioner received directions under Section 142 (2a) of the Act, purporting to be dated March 23, 1994, from respondent No. 1. By the aforesaid notice, the petitioner has been directed to get its accounts audited by a chartered accountant and to furnish a report of such audit in the prescribed form, duly signed and verified by the chartered accountant. In the aforesaid directions, one Shri N. C. Agrawal has been appointed by respondent No. 1 as the chartered accountant for this purpose. True copy of the directions is annexure 4. Photostat copy of the relevant provisions of Section 142 (2a), (2b), (2c) and (2d) are annexure 4a to the petition.

( 8 ) IT is alleged in para. 21 of the petition that a perusal of the impugned directions show that they are all in the nature of seeking informa