Invalid reassessment notice cannot erase a filed return; fresh reopening based on non-filing lacked jurisdiction.

A return filed in response to an invalid reassessment notice under section 34 of the Income-tax Act, 1922 remains a valid return under section 22(3) once submitted, because the initial notice lacked the mandatory prior sanction of the Commissioner. The Department could not then proceed on the footing that no return had been filed for the purpose of issuing a fresh notice under section 34(1)(a). The later reassessment notice, based on that incorrect assumption of non-filing, had no statutory foundation and was therefore invalid and without jurisdiction. The answer to the referred question was against the Revenue and in favour of the assessee.

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Issues: Whether a return filed in response to an invalid notice under section 34 of the Income-tax Act, 1922 could be treated as a valid return under section 22(3), and whether a fresh reassessment notice under section 34(1)(a) could validly be issued on the footing that no return had been made.

Analysis: The earlier notice under section 34 was invalid because the mandatory condition of prior sanction by the Commissioner was not complied with. A return filed in consequence of such an invalid notice could not be ignored by the Department, and once filed, it stood as a return under section 22(3). In that situation, the Department could not proceed on the basis that there had been an omission or failure to file a return so as to invoke section 34(1)(a). The later notice issued in 1953 proceeded on an incorrect assumption of non-filing and therefore lacked the jurisdictional foundation required by the statute.

Conclusion: The fresh reassessment proceedings were invalid and without jurisdiction, and the answer on the referred question was against the Revenue and in favour of the assessee.

Final Conclusion: The reassessment could not be sustained because the statutory preconditions for reopening were not met, and the assessee succeeded on the core jurisdictional issue.

Ratio Decidendi: A return filed in response to an invalid reassessment notice remains a valid return in law under section 22(3), and the Department cannot thereafter treat the assessee as having made no return for the purpose of section 34(1)(a).

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