1977 (3) TMI 38

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..... IV(3), Calcutta. The assessee was a partner of the firm, Nathubhai Odhavji & Co. and New Bihar Biri Leaves Co., Calcutta. On August 21, 1965, Bhimji Nathubhai died leaving his widow, Bai Muktaben Bhimji, and his sons as his heirs and legal representatives. Bai Muktaben Bhimji as the legal heir of the deceased made a voluntary disclosure on January 29, 1966, declaring the income of the deceased at Rs. 3,09,500. The said disclosure was accepted by the Commissioner of Income-tax, West Bengal III, and the acceptance was communicated to the Income-tax Officer, " C " Ward, District IV(3), Calcutta, on July 11, 1966. The Income-tax Officer issued a demand notice for Rs. 1,89,292 in the name of Bai Muktaben Bhimji as the legal representative of t....

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....it was held that in view of section 224 of the 1961 Act, the Tax Recovery Officer was not entitled to enter into the correctness of the assessment made by the Income-tax Officer. For the same reason, the jurisdiction of the Commissioner could not be assailed. The petition of objection of the opposite party No. 1 was, accordingly, dismissed by order dated August 23, 1971. Against this order, an appeal was preferred by the opposite party No. 1 before the Commissioner, Presidency Division, who held that as the opposite party No. 1 was not served with any notice earlier, depriving him of the recourse to appeal to the prescribed authority, the order of the Tax Recovery Officer accordingly could not be sustained which was accordingly set aside.....

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.... could not be said that the entire rule before us had abated. It may be relevant to consider the relevant provisions of the Finance (No. 2) Act of 1965. Section 24 makes a provision for voluntary disclosures of income chargeable to tax under the Indian Income-tax Act, 1922, or the Income-tax Act, 1961, for any assessment year prior to the assessment year 1965-66, for which a person has failed to furnish a return as required under those Acts or which he has failed to disclose on a return filed by him on or before 19th August, 1965, under either of the Acts or which has escaped assessment by reason of omission or failure on the part of such person to make a return under those Acts or to disclose fully and truly all material facts necessary ....

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...., that Act as far as may be apply as if the said sum was payable under that Act. The learned Commissioner in his judgment under challenge has held that the opposite party had not been served with any notice earlier and in consequence had no opportunity to prefer any appeal prescribed under the Income-tax Act, 1961, and thereby he was deprived of a legal remedy. It may be noted that under the provisions of section 24, sub-section (7), the Commissioner has to forward the declaration, with a copy of his order under sub-section (4) if any (which is not the case here) and the Income-tax Officer shall thereupon determine the sum payable as income-tax by the declarant under sub-section (3), and, thereafter, serve notice of demand under section 1....