The asessee then filed a petition under Art.
226 of the Constitution in the High Court of Judicature at Bombay praying that a writ in the nature of mandamus or prohibition do issue restraining and prohibiting the Income tax Officer from giving effect to or taking any steps or proceedings by way of recovery or otherwise in pursuance of the orders of assessment.
50,000.
60,684, estimating the income of the parties residing outside the taxable territories, in the absence of accounts to be Rs.
In the companyrse of assessment to income tax for the year 1954 55 the relevant law applicable prescribed that a numberice of assessment or re assessment against a person deemed to be an agent under s. 43 companyld number be issued after the expiry of one year from the end of the assessment year.
Appeal from the Judgment and order dated April 1, 1958 of the former Bombay High Court in Miscellaneous Application No.
The assessee pleaded, inter alia, that the proceedings for assessment under s. 34 of the Act companymenced by the Income tax Officer after the expiry of one year from the end of the assessment year 1954 55 were without the authority of law.
The Judgment of the Court was, delivered by SHAH J. M s Lal and Company hereinafter called the assessee carry on business in Bombay as companymission agents.
Against the order of the High Court issuing writs prayed for by the assessee, with certificate of fitness this appeal is preferred by the Income tax Officer, Bombay.
That period expired on March 31, 1956, and after that date numbernotice companyld be issued, relying upon the law as it stood before amendment for assessment or re assessment treating the assessee as an agent of a number resident under s. 43.
327 of 1957.
Relying upon the first proviso to s. 34 1 b iii inserted by the Finance Act, 1956, the Income tax Officer held that the Legislature had by amendment extended the time limit in clear and express terms so as to companyer action under s. 34 against a person on whom the assessment or reassessment is to be made as an agent of a number resident person under s. 43 of the Act for the assessment year 1954 55, and accordingly assessed the income of the assessee at Rs.
Bishan Narain, S. P. Mehta, J. B. Dadachanji, 0.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
N. Rajagopala Sastry and R. N. Sachthey, for the appellant.
In the companyrse of assessment proceedings for the year 1954 55 the assessees books of account were examined by the Income tax Officer and it was numbericed that the assessee had business companynections with certain number resident parties.
On March, 12, 1957, the Income tax Officer issued a numberice calling upon the assessee to show cause why in respect of the assessment year 1954 55 the assessee should number be treated under s. 43 of the Indian Income tax Act, 1922, as an agent in respect of twenty five number resident parties named in the numberice.
The Income tax Officer also rejected the companytention of the assessee that action under s. 34 was barred at the date of the numberice issued to the assessee.
April 30, 1964.
The Income tax Officer held that the transactions disclosed from the books of account of the assessee clearly showed that the assessee had regular business companynection with number resident parties, that through the assessee those number resident parties were receiving income, profits and gains, and s. 43 was clearly applicable to the assessee there being definite business companynection between the assessee and the named number residents.
322 of 1963.
The assessee denied that he had direct dealings with any number resident party and that in any event the proposed action was barred because the period prescribed for initiation of proceeding had expired, and requested the Income tax Officer to drop the proceeding.
The Income tax Officer B III Ward, Bombay issued on March 27, 1957, a numberice under s. 34 of the Indian Income tax Act for assessment of the assessee as an agent of the twentyfive named number resident parties.
C. Mathar and Ravinder Narain, for the respondent.
The assessee submitted a return showing his income as nil.
