TaxTMI 
TaxTMI 
2011 (3) TMI 690
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....ot in dispute: a) M/s. Abhudey Properties Pvt. Ltd. had been wound up by virtue of the order of the Company Court and was amalgamated with the appellant, namely, M/s. I.K. Agencies Pvt. Ltd., with effect from 1st April, 1995. As a result the appellant took all the assets and liability of the wound up company. On the relevant date for the valuation for the assessment year, the wound up company was the owner of certain assets but no Wealth Tax return was filed by it. The Assessing Officer issued a notice under Section 17 of the Wealth Tax Act, on January 20, 1997 on M/s. Abhudey Properties Pvt. Ltd. directing it to file its Wealth Tax return for the relevant period when the said company was no more in existence. b) As no Wealth Tax return was filed by the wound up company, the Assessing Officer, thereafter, issued a notice dated 10th September, 1997 under Section 16(4) of the Act upon the appellant. Consequently, a return showing nil net wealth for the abovementiond assessment year was filed by the appellant on 19th March, 1998 along with statement showing the computation of net wealth and forwarding a letter dated 6th March, 1998. In the said letter, it was inter....
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....f the appellant. Mr. Bagchi further contends the conditions mentioned in Section 17(1A) (b) (ii) should be reflected in the notice of initiation of proceedings and in the absence of such satisfaction recorded in the notice, the initiation of reopening of assessment was without jurisdiction. In support of such contention, Mr. Bagchi relies upon the decision of the Supreme Court in the case of Commissioner of Income Tax, Gujarat II vs. Kurban Hussain Ibrahimji Mithiborwala, reported in 82 ITR 821 (SC) and that of a Division Bench of this Court in the case of Commissioner of Income Tax vs. Bibhuti Bhusan Mallick reported in, 165 ITR 107 (Cal). Mr. Dutta, the learned Advocate appearing on behalf of the Revenue, on the other hand, has opposed the aforesaid contention and has submitted that the recording of wrong name is a mistake in the notice and Section 42(c) of the Wealth Tax Act cures such defect. He further relies upon the decision of Supreme Court in the case of GKN Driveshafts (India) Ltd. vs. Income Tax Officer & Ors., reported in 259 ITR 19, in support of his contention that the initiation of proceeding was legal. Mr. Dutta, therefore, prays for dismissal of the appeal. Therefo....
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....e on the part of the assessee to make a return under section 14 or section 15 or in response to a notice issued under sub-section (4) of section 16 or this section or to disclose fully and truly all material facts necessary for his assessment for that assessment year : Provided further that th e Assessing Officer shall, before issuing any notice under this sub-section, record his reasons for doing so. Explanation : Production before the Assessing Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer will not necessarily amount to disclosure within the meaning of the foregoing proviso. (1A) No notice under sub-section (1) shall be issued for the relevant assessment year, - (a) in a case where an assessment under subsection (3) of section 16 or sub-section (1) of this section has been made for such assessment year, - (i) if four years have elapsed from the end of the relevant assessment year, unless the case falls under sub-clause (ii) or sub-clause (iii); (ii) if four years, but not more than seven years, have elapsed from the end of the relevant assessment year, unless the n....
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....such notice shall be issued unless the Chief Commissioner or Commissioner is satisfied, on the reasons recorded by the Assessing Officer aforesaid, that it is a fit case for the issue of such notice. (b) In a case other than a case falling under clause (a), no notice shall be issued under sub-section (1) by an Assessing Officer, who is below the rank of Joint Commissioner, after the expiry of four years from the end of the relevant assessment year, unless the Joint Commissioner is satisfied, on the reasons recorded by such Assessing Officer, that it is a fit case for the issue of such notice. (2) Nothing contained in this section limiting the time within which any proceeding for assessment or reassessment may be commenced, shall apply to an assessment or reassessment to be made on such person in consequence of or to give effect to any finding or direction, contained in an order under section 23, 24, 25, 27, or 29 or by a Court in any proceedings under any other law : Provided that the provisions of this sub-section shall not apply in any case where any such assessment or reassessment relates to an assessment year in respect of which an assessment or re....
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....eme Court proceeded, would not make any difference to the character of the proceeding in pursuance of the said notice. In the subsequent case of the Supreme Court in the case of Commissioner of Income Tax vs. Kurban Hussain Ibrahimji Mithborwala, reported in (1971) 82 ITR 821 (SC), the same view was adopted where in the notice a wrong assessment year was given. A Division Bench of this Court in the case of Commissioner of Income Tax vs. Bibhuti Bhusan Mallick, reported in (1987) 165 ITR 197 (CAL) took into consideration various decisions including the above two and came to the conclusion that in a case where the assessee, Bibhuti Bhusan Mallick is assessed as a Hindu Undivided Family, a notice issued by the Income Tax Officer with the intention to reopen the assessment issued in the name of Panchanan Mallick and Bibhuti Bhusan Mallick was found to be without jurisdiction notwithstanding the fact that the real assessee submitted return pursuant to such notice. Mr. Dutta, the learned counsel appearing on behalf of the Revenue for the purpose of overcoming the aforesaid decisions, strongly relied upon the provision contained in Section 42C of the Act in support of his conten....
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....nd to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the assessing officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the assessing officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the abovesaid five assessment years. "Insofar as the appeals filed against the order of assessment before the Commissioner (Appeals), we direct the Appellate Authority to dispose of the same, expeditiously. With the above observations, the civil appeals are dismissed." In our view, the aforesaid decision does not answer the question before us as to whether a notice of reopening of the assessment is valid when the notice has not been given to the real assessee or an assessee who was not in existence at the time of issue and the decisions referred to by us answers the question. We, however, find no substance in the contention of Mr. Bagchi, the learned advocate for the appellant that the reason for initiation of reopening proceedin....