Voluntary return bars reassessment notice where statutory conditions are unmet, making the resulting assessment void.

A voluntary return filed within limitation under section 22(3) prevented valid initiation of reassessment under section 34 of the Income-tax Act, 1922, because the statutory precondition for resorting to that provision was absent. Earlier administrative steps, including obtaining the Commissioner's sanction, did not amount to initiation of proceedings in law; reassessment begins only with service of the notice. Completion of the assessment within the section 34(3) period did not cure the defect, as an assessment founded on an invalid notice lacks legal foundation. The notice was therefore invalid, and the assessment made pursuant to it was void.

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Issues: Whether a notice under section 34 of the Income-tax Act, 1922 was valid when a voluntary return under section 22(3) had already been filed within the period of limitation, and whether an assessment completed on the basis of such notice was valid.

Analysis: A voluntary return had been filed before the reassessment notice was issued. In such a situation, reassessment proceedings under section 34 could not lawfully be initiated, because the statutory condition for resorting to that provision was not satisfied. The fact that preliminary steps such as seeking sanction from the Commissioner had been taken earlier did not amount to initiation of proceedings in law, since proceedings under section 34 begin only with the issue of the notice. Nor did completion of the assessment within the period prescribed by section 34(3) cure the defect, because an assessment founded on an invalid notice remains without legal foundation.

Conclusion: The notice under section 34 was invalid, and the assessment made pursuant to that notice was illegal and void, in favour of the assessee.

Final Conclusion: Reassessment could not be sustained once a valid voluntary return was already on record, and the reassessment proceedings failed for want of lawful initiation.

Ratio Decidendi: Where a voluntary return under section 22(3) has already been filed within limitation, a notice under section 34 cannot validly be issued, and any assessment made in pursuance of such notice is void.

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