TaxTMI 
TaxTMI 
1970 (9) TMI 32
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....ce to that judgment to indicate that our reasons for the answers to these questions are to be found there and that judgment should be used for answering these two questions. There is, however, only one particular point on which Dr. Pal appearing for the assessee has tried to make a distinction from the facts in the judgment delivered in the other case mentioned above. That point briefly is that the order made by the Commissioner under section 33B in this case is illegal and bad under section 5(7C) of the Indian Income-tax Act, 1922, on the ground that one Commissioner gave the notice to show cause under section 33B and thereafter when he ceased to have the jurisdiction some other Commissioner made the order under section 33B of the Income-tax Act, 1922. The facts on this point are as follows : The show-cause notice by the Commissioner of Income-tax, West Bengal, was given on the 8th August, 1963, by Mr. Vallibhoy, the then Commissioner. The assessee made a reply to the show-cause notice in writing on the 29th August, 1963. Thereafter, Mr. Vallibhoy ceased to have his jurisdiction and one Mr. Palekar, Commissioner of Income-tax, West Bengal-III, assumed charge on the 2nd Septe....
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....age that there was no request for rehearing made on the 3rd September, 1963, when the order was being passed or when the case was intended to be heard and where the assessee was ordered to attend. No reason is given on the record by the assessee to show why he was absent from the hearing on the 3rd September, 1963. The record does not show that he was absent from the hearing on the 3rd September, 1963, for any unavoidable cause or on any misunderstanding. The assessee just chose not to appear on that crucial date which was notified to him by the Commissioner as the date when he would be given an opportunity to be heard. There are many difficulties in the way of the assessee in entertaining this point under section 5(7C) of the Indian Income-tax Act, 1922. The first difficulty of course is that it is debatable whether he at all made this point or argued it before the Tribunal. The order of the Tribunal in this case does not make any reference to this particular point that the notice to show cause was issued by one Commissioner and was heard by another Commissioner when the previous Commissioner had ceased to exercise jurisdiction. A similar point was raised in the case of ITR No.....
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....oceeding from the point where it was left by his predecessor authority. That is the very first provision quoted above. Now, that mandate can only be displaced if the assessee concerned demands that before the proceeding is so continued the previous proceeding or any part thereof be reopened or that before any order for assessment is passed against him he be re-heard. That is the clear and express language of the proviso. The assessee in the facts and circumstances of this case cannot at all come within this proviso. There is no demand by him "before the proceeding is so continued" either to reopen the previous proceeding or to re-hear him. Indeed, it is significant that the assessee's own statement of the case before the Tribunal accompanying the applications for reference never even suggested expressly or impliedly that he wanted or demanded the previous proceeding to be reopened or that he, the assessee, should be reheard. Here, again, the assessee's own absence from the date notified for hearing, i. e., September 3, 1963, is also a fact against this contention for if he had appeared he would have known that the hearing was given by Mr. Palekar and not Mr. Vallibhoy and he could ....
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....d a further right under section 28(3) of the Indian Income-tax Act, 1922. The court in that case held that although the right under section 5(7C) has been lost the right of being heard under section 28(3) of the Indian Income-tax Act, 1922, has not been lost. But there is no question of any right of being heard under section 28(3) in the instant reference before us. Reference was also made to a Calcutta decision in Kanailal Gatani v. Commissioner of Income-tax [1963] 48 ITR 262 (Cal). But, as will be clear from the observations made at pages 269-270, the court expressed there no opinion on the interpretation of section 5(7C) of the Indian Income-tax Act, 1922. This disposes of the two Calcutta decisions referred to in the arguments made from the Bar. The Punjab and Haryana High Court in Satprakash Ram Naranjan v. Commissioner of Income-tax [1969] 71 ITR 646 (Punj) followed the Calcutta decision in Calcutta Tanneries' case [1960] 40 ITR 178 (Cal) (see the observations at page 649 of that report). The Mysore High Court in Shop Siddegowda & Family v. Commissioner of income-tax [1964] 53 ITR 57 (Mys) discussed this point under section 5(7C) of the Indian Income-tax Act, 192....