1986 (6) TMI 1

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....e beyond the period of limitation prescribed under section 153(2) of the Income-tax Act and hence invalid ? " The assessee is a registered firm carrying on business in purchase and sale of cloth. For the assessment year 1962-63 corresponding to the previous year ended March 31, 1962, the assessee filed a return showing total income of Rs. 890 from textile exports and an assessment was made on the same day by the Income-tax Officer, Erode, accepting the return. Similarly, for the assessment year 1963-64, the assessee filed a return on November 27, 1963, showing a total income of Rs. 8,809 from textile exports and accepting the return, an assessment order was made by the same officer on November 27, 1963, itself. On November 30, 1965, the ....

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....at the second notice issued under section 148 of the Act on October 15, 1968, was invalid as the earlier returns filed by him in pursuance of the notice dated March 17, 1966, issued by the Income-tax Officer, Erode, under section 148 of the Act are still pending and had not been disposed of. The Appellate Assistant Commissioner accepted this contention and held that the order of the Income-tax Officer, City Circle, Madras, made on March 29, 1973, was without jurisdiction. On further appeal, however the Tribunal was of the view that it is not possible to accept the contention of the assessee that because of the issue of notice under section 148 of the Act by the Income-tax Officer, Erode, the original assessment proceedings could not be said....

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.... of a notice issued under section 34 of the Indian Income-tax Act, 1922, it was not open to the Income-tax Officer to ignore that return and issue a further notice under section 34(1)(a) on the assumption that there had been an omission or failure on the part of the assessee to make a return of his income. In fact, the learned judges further held that even if the original notice issued under section 34(1) of the Act was not a valid notice, the return filed in pursuance of such notice itself could not be regarded as non est or illegal and even in such a case, the initiation of fresh proceedings under section 34 with the issue of a fresh notice was without jurisdiction. This judgment was affirmed by the Supreme Court in the decision in CIT v.....