1966 (10) TMI 1

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....rounds, on which the notice was challenged, were given in an affidavit in support of the petition ; and it appears from that affidavit that the notice was challenged on two grounds. The first ground was that there were no reasons whatever to enable the appellant to believe that any income of the respondent for the year in question had escaped assessment or had been under-assessed. The second ground was that there were no bona fides whatever in the issue of that notice, and that, since there was no reason to enable the appellant to issue the notice, its issue was without the authority of law and lacked jurisdiction. It was averred that the notice had been issued arbitrarily in the vain hope that the department might, at a later stage, come a....

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....ing the notice issued by the appellant on a ground which was not raised by the respondent in his petition under article 226 of the Constitution. This submission has to be accepted. Learned counsel appearing for the respondent was unable to show any averments in the affidavit filed on behalf of the respondent where such a ground might have been raised. The respondent, in that affidavit, clearly understood that the notice issued by the appellant was under clause (a) of sub-section (1) of section 34 of the Act, and yet, confined the challenge to the ground that the appellant had no reasons whatever to believe that the income of the respondent had escaped assessment or had been under-assessed. It was at no stage stated that the appellant had no....

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....the issue of the notice in question. We have seen the report submitted by the appellant to the Commissioner of Income-tax, and it appears to us that that report, taken together with his letter asking for approval of the Commissioner for issue of notice under section 34(1)(a) which was accompanied by information in proforma " B " indicates that the appellant did have reasons to believe that the income of the respondent had been under-assessed because of reasons mentioned in section 34(1)(a) of the Act. We are, thus, satisfied that the notice issued under section 34(1)(a) was not at all invalid. We may also, in this connection, mention that the allegation of the respondent that the appellant had no reason to believe that the income of the res....