1972 (1) TMI 28

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....ear 1960-61?" The assessee is Sant Baba Mohan Singh. He has been assessed as an individual for the assessment year 1960-61 for which the relevant account year ended on March 31, 1960. In response to a notice under section 22(2) of the Income-tax Act, 1922, he filed a return showing his income as nil. In the return he made a note saying that he was engaged in the service of the public for religious and charitable purposes and therefore had no personal income. The Income-tax Officer, however, estimated the assessee's net income at Rs. 1,00,000 and made an assessment order accordingly. On appeal by the assessee, the Appellate Assistant Commissioner found that the assessment was completed under section 23(3) without the issue of a notice ....

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....ust be negatived. Section 31(3)(a) speaks of the power of the Appellate Assistant Commissioner to annul an assessment. That is a power to be exercised where the assessment proceeding is a nullity in the sense that the Income-tax Officer had no jurisdiction ab initio to take the proceeding. A proceeding is a nullity when the authority taking it has no jurisdiction either because of want of pecuniary jurisdiction or of territorial jurisdiction or of jurisdiction over the subject-matter of the proceeding. A proceeding is a nullity when the authority taking it has no power to have seisin over the case. The omission of the Income-tax Officer to issue a notice under section 23(2) does not affect the ab initio jurisdiction enjoyed by the Income-ta....

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....at the Income-tax Officer when making it took into consideration a number of documents, including two registered deeds, the reply of the assessee to certain queries, an affidavit filed by the assessee as well as the bank pass book of the account maintained by the assessee. All this material was before the Income-tax Officer and he considered it, and it cannot be said that no enquiry was made by him before he completed the assessment. Clearly, when the Appellate Assistant Commissioner set aside the assessment and directed the Income-tax Officer to frame a fresh assessment the latter was bound to issue a notice under section 23(2), something he had omitted to do earlier and then to make an enquiry into the matter. Learned counsel has relie....