1992 (1) TMI 49

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....petition is directed against the notice dated March 23, 1978, issued by the Income-tax Officer, Company Circle, New Delhi, under section 148 of the Income-tax Act, 1961. The relevant assessment year is 1974-75. Through the said notice, the petitioner was informed that the Income-tax Officer has reasons to believe that some income has escaped assessment within the meaning of section 147 of the Inco....

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....on September 1, 1976, with effect from December 23, 1975. In view of the provisions of section 36(1)(iv) and (1)(v), the assessee is entitled to deduction of the amounts only if they fall under the said two sub-clauses and if there is any contribution to non-recognised provident fund or a non-approved gratuity fund and if there is any provision with respect to the same, the deduction cannot be gra....

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....ncement of business by the petitioner. The Income-tax Officer was satisfied with this information as regards the interpretation of the newly added section 40A(7) and, therefore, allowed the deduction. The submission of the petitioner is that information regarding the interpretation of a legal provision by the Revenue audit is not information within the meaning of section 147(b) of the Act. Even ot....

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....61. The Supreme Court has further held : "In every case, the Income-tax Officer must determine for himself what is the effect and consequence of the law mentioned in the audit note and whether in consequence of the law which has now come to his notice, he can reasonably believe that income has escaped assessment". Thus, in the present case, there was no information as required by law before the au....