1980 (7) TMI 34

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....I.T. Act, 1961, hereinafter called the Act, the Income-tax Appellate Tribunal, Indore Bench, has referred the following questions of law to this court for its opinion: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding the proceedings started u/s. 147(b) as invalid and the assessment framed as illegal in view of the infirmity that the ITO ....

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....y cl. (b) of s. 147 of the Act. The assessee filed a return under protest. The ITO, overruling the objections of the assessee about the validity of reassessment proceedings, completed reassessment on l2th January, 1967, after including a sum of Rs. 45,000 which was paid by the assessee as compensation to M/s. Natwarlal Shamaldas & Co., Bombay, for a breach of contract. The assessee preferred appea....

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....e. Now, as regards the first question, it would be useful to refer to the provisions of section 148 of the Act, which are as follows: 148. Issue of notice where income has escaped assessment.-(1) Before making the assessment, reassessment or recomputation under section 147, the Income-tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be incl....

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.... Act vitiated the reassessment. Learned counsel for the department was unable to point out that the view taken by the Tribunal was not justified in the circumstance of the case. Our answer to the first question referred to this court is in, the affirmative and against the department. As regards the second question referred to this court, learned counsel for the parties conceded that it our answ....