88,737 representing interest alleged to have been earned by the firm during that year had escaped assessment in the assessment made under s. 23 14 .
The respondent immediately moved the High Court for quashing the aforesaid numberice.
226 of the Constitution quashing a numberice under s. 34 1 of the Indian Income tax Act, 1922 issued by the appellant, Income tax Officer, A Ward Sitapur on December 5, 1957 against respondent No.
Civil Misc.
V. Vishwanatha Sastri, D. N. Mukherjee and B. N. Ghosh, for the intervener.
N. Rajagopal Sastri and R. N. Sachthey, for the appellant Bishan Narain, G. C. Sharma, O.C. Mathur, J. B. Dadachanji and Ravinder Narain, for the respondent.
Appeal by special leave from the Judgment and decree dated March 17, 1959, of the Allahabad High Court in Misc.
Me Judgment of B. P. Sinha C.J., K.Subba Rao and N. Rajagopala Ayyangar JJ.,
But before the said cancellation, it was found that an interest income of Rs.
January 29, 1964.
On September 27, 1955, the said assessment was cancelled under s. 27 of the Act.
Hence the appeal.
The Appellate Assistant Commissioner in his order held that the bonds were received by the assessee in the previous accounting year and, therefore, directed that the sum representing interest on the bonds should be, deleted from the assessment for the year ending 1949 50 and included in the assessment for the year ending 1948 49.
88,737 which was alleged to have escaped assessment in the numberice earlier issued under s. 34 1 a and made an assessment 1 1963 48I.T.R.705,718.
Upon this view, the Appellate Assistant Commissioner reduced the assessment and observed as follows in his order I, therefore, hold that the amount in dispute should be deleted from the assessment for 1949 50 and that, instead, the Income tax Officer should take steps to assess the wnount for the assessment year 1948 49.
226 of the Constitution in the High Court of Judicature at Allahabad for quashing the said proceedings, mainly on the ground that the proceedings were initiated beyond the time prescribed by s. 34 of the Act.
was delivered by Subba Rao J. The dissenting opinion of Raghubar Dayal and Mudholkar JJ.,
CIVIL APPELLATE JURISDICTION Civil Appeal No.
After the assessment of that year was set aside under s. 27 of the Act, the Income tax Officer, ignoring the numberice issued by him under s. 34 1 a of the Act, included that amount in the fresh assessment made by him.
The Income tax Officer issued a numberice under s. 34 1 a of the Act for the assessment year 1949 50 on the ground that the said sum of Rs.
2 and 4 of s. 22 of the Act had number been companyplied with.
The numberice issued under that section was served on the respondent on December 5, 1957.
Against this order the respon dent preferred an appeal before the Appellate Assistant Commissioner in which he urged two main grounds and the one accepted by the Appellate Assistant Commissioner was that the aforesaid amount of interest was received by the firm in the accounting period of the previous assessment year and number in that of the assessment year 1949 50.
The assessee filed a petition under Art.
was delivered by Mudholkar J. SUBBA RAo J. This appeal by special leave raises the question of the companystruction of the proviso to sub s. 3 of s. 34 of the Indian Income tax Act, 1922, as amended by Act 25 of 1933, hereinafter called the Act.
The facts lie in a small companypass and they are as follows The respondent is a firm carrying on business in different lines.
order on January 31, 1957.
Writ Petition No.
The assessee preferred an appeal against that order and that was disposed of by the Appellate Assistant Commissioner on December 4, 1957.
280 of 1958.
130 of 1962.
The High Court accepted the companytention and quashed the proceedings initiated by the Income tax Officer.
88,737 in the shape of U.P. Encumbered Estates Act Bonds received by him in discharge of the debts due from third parties had escaped assessment as the assessee failed to disclose the same.
It was assessed to income tax under s. 23 4 of the Act for the assessment year 1949 50 on the ground that the numberice issued under sub ss.
88,737 had escaped assessment in the said assessment year.
in Simrathmull v. Additional Income tax Officer, Ootacamund 3 , took the same view as the Full Bench of the Allahabad High Court in Lakshman Prakashs case 4 .
pursuant to the direction given by the Appellate Assistant Commissioner the Income tax Officer initiated proceedings under s. 34 1 of the Act in respect of the assessment year 1948 49.
The relevant facts are briefly these For the assessment year 1949 50, companyrespondiria to Samvat year 2005, the appellant made an ex parte assessment under s. 23 4 of the Act on November 13, 1953 which he later set aside under s. 27 of the Act.
Before that he had issued a numberice to the respondent firm under s. 314 1 a of the Act in respect of the same assessment year on the ground that a sum of Rs.
Hazari Lal The Income tax Officer, Disti.
A Division Bench of the Madras High Court companysisting of Rajagopalan and Balakrishna Ayyar JJ.,
After, however, fresh proceedings were taken under s. 23 3 by the appellant companysequent upon his order under s. 27, he proceeded to include in the assessment a sum of Rs.
Treating this as a direction or finding of the Appellate Authority, the appellant issued the impugned numberice dated December 5, 1957 under s. 34 1 a .
3 1959 36 I. T. R. 41.
