2004 (3) TMI 28

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....der section 16(3) of the Act on the total wealth of Rs. 18,00,000 vide order dated February 11, 1992. Thereafter, it came to the notice of the Assessing Officer that taxable wealth of the assessee had escaped assessment on account of under valuation of immovable property. It was found that while calculating the value of immovable property under Schedule III to the Act, the assessee had adopted the gross maintainable rent at Rs, 1,51,550 as per his income-tax return. However, this amount included rent of one property for two months only, whereas the rent receivable for the entire year ought to have been included as provided in rule 3 of Part B of Schedule III to the Act. The correct value of the immovable property on that basis worked out to....

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....the valuation of the property under Schedule III to the Act, the gross maintainable rent in respect of the property in question had been adopted at Rs. 22,000 which represented rent for two months only and not rent for the whole year. Thus, he could not dispute the fact that the property had indeed been undervalued. He, therefore, confined his challenge to the validity of the proceedings under section 17 of the Act. He contended that all the relevant facts had duly been disclosed by the assessee in the original return and as such the escapement of wealth was attributable to the failure of the Assessing Officer to draw correct inferences from the facts disclosed. He then contended that the Assessing Officer had no jurisdiction to issue notic....

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....d any merit in the other objections raised against the validity of the notice dated March 4, 1994, under section 17 of the Act. The earlier notice under section 17 issued by the Assessing Officer on July 22, 1993, was admittedly not a valid notice as it had been issued without the approval of the higher authority as required by sub-section (1B) of section 17 of the Act. Thus notice dated July 22,1993, was void ab initio and did not give rise to any valid proceedings. Therefore, it cannot be said that when notice under section 17 was issued on March 4, 1994, any earlier reassessment proceedings were pending. Similarly, it is not disputed that the Assessing Officer had duly recorded reasons about the escapement of income on July 22, 1993, whe....