JUDGMENT judgment of court was delivered by Sudhir Agarwal J.-This reference application has come up at instance of assessee, vide Income Tax Application No. 4 of 1982, arising out of I. T. A. No. 386 (Alld.)/1978-79 and following reference has been made by Tribunal: "Whether, on facts and in circumstances of case, Tribunal was correct in holding that once Income-tax Officer reopen assessment under section 147(b) of Income-tax Act, 1961, he is empowered to consider and assess all other items afresh?" dispute relates to assessment year 1969-70. assessee is public limited company carrying on business of manufacturing of cotton textile, rayon yarn and television sets, etc. accounting period relevant to assessment year 1969-70 ended on December 31, 1968. original assessment under section 143(3) of Income-tax Act, 1961 (hereinafter referred to as "the Act, 1961") completed on March 30, 1972, on total income of Rs. 30,18,194. Assessing Officer allowed development rebate at 35 per cent. in respect of electronic units. Based on Appellate Commissioner's order for assessment year 1970-71, Income-tax Officer (hereinafter referred to as "the ITO") initiated proceedings under section 147(b) of Act, 1961, by issuing notice under section 148 on March 15, 1974. assessee objected thereto but said proceedings were upheld by Tribunal with further observation that once Income-tax Officer reopen assessment on basis of one item, he is empowered to consider all other items afresh. In notice dated March 15, 1974, issued by Assessing Officer under section 148 read with section 147(b), he said: "On basis of'information' within meaning of section 147(b), read from Appellate Assistant Commissioner's decision in case of assessee for assessment year 1970-71 regarding non-entitlement of higher development rebate to electronic unit, proceedings are initiated under section 147(b)." He further said that on basis of above information he has reason to believe that assessee was allowed excess relief amounting to Rs. 57,088 (development rebate on electronic unit allowed at rate of 35 per cent. amounting to Rs. 1,33,205 instead of allowable at rate of 20 per cent., i.e., Rs. 76,117). notice under section 148 was, accordingly, issued on July 31, 1973. Initially proceedings were dropped on March 15, 1974, but again initiated on that very date. Assessing Officer, thereafter, proceeded to make reassessment not only in regard to development rebate but other items also, which action has been confirmed by Tribunal observing as under: "It is by now well established law that once Income-tax Officer reopens assessment on basis of one item, he is empowered to consider all other items afresh and, therefore, we are not prepared to accede to submissions made on behalf of assessee that Income-tax Officer had reopened assessment in instant case with some ulterior motive/purpose or that his action was mala fide." (emphasis added) Tribunal relied on decisions in CIT v. Kerala State Industrial Development Corporation Ltd. [1979] 116 ITR 158 (Ker) and Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996 (SC) for taking view that once assessment is reopened in respect of one item, all other aspects would also be opened for reassessment. assessee made application under section 255(1) of Act, 1961, before Tribunal requesting for making reference on two questions but said application was rejected by Tribunal, vide order dated July 27, 1981, whereafter assessee came to this court and, vide order dated March 5, 1986, this court directed Tribunal to make reference on question, as noted above, pursuant whereto above reference has come. This court is now confined to consider question, "whether on reopening of case under section 147, it is open to Income-tax Officer to consider all other items and not to confine to item on which reassessment notice has been given". From order dated March 13, 1975, whereby Assessing Officer not only reopened case but made assessment in respect to various other items, other than quantum of development rebate, we find that he has relied on apex court's decision in V. Jaganmohan Rao v. CIT/EPT [1970] 75 ITR 373 (SC) in order to hold that once assessment is reopened, previous assessment is set aside and whole assessment proceedings restart afresh. This view has also been confirmed by Tribunal while confirming reassessment proceedings and opening of entire matter afresh. This reference is pending since 1986 and we find that apex court's decision in V. Jaganmohan Rao (supra) has been considered and explained subsequently in CIT v. Sun Engineering Works P. Ltd. [1992] 198 ITR 297 (SC). court having gone through judgment in V. Jaganmohan Rao (supra) held that principle laid down therein is only to extent that once assessment is validly reopened by issuance of notice under section 22(2) of Indian Income- tax Act, 1922 (corresponding to section 148 of Act, 1961), previous underassessment is set aside and Income-tax Officer would have jurisdiction and duty to levy tax on entire income that had escaped assessment during previous year. What set aside is, thus, only previous underassessment and not original assessment proceedings. court very categorically held (page 319 of 198 ITR): "An order made in relation to escaped turnover does not affect operative force of original assessment, particularly if it has acquired finality, and original order retains both its character and identity." court further said that it is only in cases of "underassessment" based on clauses (a) to (d) of Explanation 1 to section 147, that assessment of tax due has to be recomputed on entire taxable income. In Sun Engineering Works (supra) explaining decision in V. Jaganmohan Rao (supra), court very categorically said (page 319 of 198 ITR): "The judgment in Jaganmohan Rao's case, therefore, cannot be read to imply as laying down that in reassessment proceedings validly initiated, assessee can seek reopening of whole assessment and claim credit in respect of items finally concluded in original assessment. assessee cannot claim recompilation of income or redoing of assessment and be allowed claim which he either failed to make or which was otherwise rejected at time of original assessment which has since acquired finality. Of course, in reassessment proceedings it is open to assessee to show that income alleged to have escaped assessment has in truth and in fact not escaped assessment but that same had been shown under some inappropriate head in original return, but to read judgment in Jaganmohan Rao's case, as if laying down that reassessment wipes out original assessment and that reassessment is not only confined to'escaped assessment' or'under assessment' but to entire assessment for year and start assessment proceeding de novo giving right to assessee to reagitate matters which he had lost during original assessment proceeding, which had acquired finality, is not only erroneous but also against phraseology of section 147 of Act and object of reassessment proceedings." (emphasis added) court further said that section 147 is part of taxing statute. It imposes no charge on subject but deals merely with machinery of assessment. While interpreting such provision, construction which makes machinery workable, should be preferred. It was held that section 147 is for benefit of Revenue and not assessee. It aims at garnering escaped income of assessee. aforesaid provision cannot be allowed to be converted as revisional or review proceedings so as to make machinery unworkable. Having said so court in Sun Engineering Works (supra) held (page 320 of 198 ITR): "As result of aforesaid discussion, we find that in proceedings under section 147 of Act, Income-tax Officer may bring to charge items of income which had escaped assessment other than or in addition to that item or items which have led to issuance of notice under section 148 and where reassessment is made under section 147 in respect of income which has escaped tax, Income-tax Officer's jurisdiction is confined to only such income which has escaped tax or has been underassessed and does not extend to revising, reopening or reconsidering whole assessment or permitting assessee to reagitate questions which had been decided in original assessment proceedings. It is only underassessment which is set aside and not entire assessment when reassessment proceedings are initiated. not entire assessment when reassessment proceedings are initiated. Income-tax Officer cannot make order of reassessment inconsistent with original order of assessment in respect of matters which are not subject matter of proceedings under section 147." (emphasis1 added) It is further said that words "such income" in section 147 clearly referred to income which is chargeable to tax but has escaped assessment and Income-tax Officer's jurisdiction under section is confined only to "such income" which has escaped assessment. It does not extend to consider generally concluded earlier assessment. matter not agitated in concluded original assessment proceedings, cannot be permitted to be agitated in reassessment proceedings unless relatable to item sought to be taxed as "escaped income". Several decisions of various High Courts taking different view were overruled by apex court which included Deputy CCT v. Indian Refrigeration Industries P. Ltd. [1980] 46 STC 264 (Mad); CIT v. Ramsevak Paul [1977] 110 ITR 527 (Cal); CIT v. Assam Oil Co. Ltd. [1982] 133 ITR 204 (Cal); CIT v. Standard Motor Products of India Ltd. [1983] 142 ITR 877 (Mad); CIT v. Rangnath Bangur [1984] 149 ITR 487 (Raj); State Bank of Hyderabad v. CIT [1988] 171 ITR 232 (AP) and CIT v. Indian Rare Earth Ltd. [1990] 181 ITR 22 (Bom) [FB]. Sri Shambhu Chopra, learned counsel appearing for Revenue, attempted to contend that aforesaid judgment must be read to impose such restriction at instance of assessee and not for Revenue. He contended that court in Sun Engineering Works (supra) has observed that section 147 is for benefit of Revenue and, therefore, whatever restrictive interpretation court has given therein, should be applied only when in matter of reassessment objection is raised by assessee and attempt is made to reopen entire case but so far as Revenue is concerned, it is free to treat assessment completely reopened once proceeding under section 147 has been issued and there should be no restriction at all. submission, in our view, is thoroughly misconceived. Before apex court, assessee was attempting to argue that once assessment proceedings recommenced, entire assessment would be reopened as if earlier assessment has gone which argument was rejected by court. That is how reference with respect to assessment has come but it cannot be said that natural consequences of provision would be different for assessee and Revenue. Both parties will have to follow same consequences unless different intention appears from statute which has not been shown at all. judgment must be read as whole and observations from judgment should be considered in light of questions which were before court. decision of court takes it colour from questions involved in case in which it has rendered. While applying decision to later case, court must carefully try to ascertain true principle laid down in decision and not to pick out words from decision, divorce from context of question under consideration by court. If assessee cannot be allowed to convert proceedings initiated under section 147 as revisional or review, same would also be not available to Revenue. Division Bench of this court in CIT v. Omrao Industrial Corporation P. Ltd. [2000] 246 ITR 346 (All); [2001] UPTC 897 has also taken similar view following Sun Engineering Works (supra) and observed (page 347): "We find that scope of powers of Income-tax Officer and making reassessment under section 147(a) has been settled by Supreme Court in CIT v. Sun Engineering Works P. Ltd. [1992] 198 ITR 297 (SC) where Supreme Court held that though Income-tax Officer may bring to charge items of income which had escaped assessment other than or in addition to item or items which have led to issuance of notice under section 148, Income-tax Officer cannot make order of reassessment inconsistent with original order of assessment in respect of matters which are not subject matter of proceedings under section 147 and matter not agitated in concluded original assessment proceedings cannot be permitted to be agitated in such reassessment proceedings unless relatable to item sought to be taxed as escaped income. In our view, therefore, for reasons that have been recorded by Tribunal, Income-tax Officer could not add/disallow other items which were allowed by him in original assessment merely by taking different view." (emphasis added) On behalf of Revenue, Sri Shambhu Chopra, learned counsel placed reliance on decision of Madras High Court in Satyamangalam Agricultural Producer's Co-operative Marketing Society Ltd. v. ITO [2013] 357 ITR 347 (Mad) but therein we do not find anything which may help Revenue and to persuade this court to take different view than what it has expressed above. He also placed reliance on subsequent decision in ITO v. K. L. Srihari (HUF) [2001] 250 ITR 193 (SC) but therein we find that court did not consider question, whether judgment in Sun Engineering Works (supra) should be referred to larger Bench or not but dismissed appeal on facts of that particular case. It is difficult to suggest that aforesaid judgment lay down any law on subject in view of decision given in facts of that case. reference is, accordingly, answered in negative, i.e., against Revenue and in favour of assessee. *** J. K. Cotton Spinning and Weaving v. Commissioner of Income-tax