B.P. Jeevan Reddy, CJ.

1. This is a petition for issuance of a writ in the nature of prohibition restraining the respondents (assessing authorities under the Income-tax Act) from proceeding with, or passing any orders in, the assessment proceedings against the petitioner relating to the assessment year 1971-72.

2. The petitioner is a company registered under the, Companies Act. It is engaged in the business of generation and supply of power. It is an assessee under the Income-tax Act. For the assessment year 1971-72, the petitioner filed a return of its income, on the basis of which an order of assessment was made by the Income-tax Officer on February 27, 1975, under Section 142 of the Act. It was a case of nil assessment. Subsequently, the Income-tax Officer sought to reopen the assessment by issuing a notice under Section 148, which was questioned by the petitioner by way of a writ petition in this court (C.M.W.P. No. 578 of 1976). This aspect is not really relevant for our purpose and it is also not clear as to what happened to the said writ petition. What is, however, relevant is that by a notice dated February 7, 1977, the Commissioner of Income-tax proposed to revise the assessment order dated February 27, 1975. Under the said notice, the order of assessment was proposed to be revised on eight points. After hearing the petitioner, the Commissioner passed final orders on February 26, 1977. Of the eight points mentioned in the show cause notice, two were held in favour of the assessee, one was held against it and with respect to the remaining five, the matter was remitted to the Income-tax Officer to make a fresh assessment in accordance with law. The assessee filed an appeal against the order of the Commissioner dated February 26, 1977, confined only to the five points which were remitted to the Income-tax Officer. The appeal did not pertain to the points which were held against the assessee. In this appeal, the petitioner filed a stay petition, but no orders were passed thereon. Ultimately, the appeal was dismissed by the Tribunal on February 28, 1979. While dismissing the appeal, the Tribunal gave certain directions, which are relevant for our present purpose, and, therefore, set out :

"6. After carefully examining the rival submissions and examining the merits on record, we are of the opinion that the order of the Commissioner under Section 263 has to be upheld. The order of the Income-tax Officer was prima facie erroneous and prejudicial to the interests of the Revenue. The Commissioner, therefore, has rightly assumed jurisdiction under Section 263 and set aside the order.

7. Simultaneously, we feel that the Commissioner was not justified in limiting the discretion of the Income-tax Officer and moreover forcing him to take an indicated course of action while at the same time stating that he wanted him to pass the order de novo in accordance with law. When the order has to be passed in accordance with law de novo, the Income-tax Officer has to be left unfettered to act in the light of his judgment, to consider the law and to pass orders, in accordance therewith.

8. We, therefore, direct that while passing such order, the Income-tax Officer will ignore the various observations made by the Commissioner in his order enunciating his views under the law, as we have already noted that counsel for the Commissioner agreed to this course of action.

9. In the result, for statistical purposes, the appeal is allowed in part."

The present writ petition was filed on July 21, 1980, contending that, inasmuch as no order of assessment was made within two years from the end of the financial year in which the Commissioner passed his order under Section 263, no order of assessment can be made thereafter, by virtue of the provisions contained in Sub-Section (2A) of Section 153 of the Act. It is submitted that, according to the said sub-section, an order of fresh assessment in pursuance of an order under Section 263 can be made at any t