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Issues involved: Assessment u/s 143(1), initiation of proceedings u/s 147(a), notice u/s 148, jurisdiction for reassessment, service of notice u/s 148, validity of assessment.
Summary: The assessee filed returns for assessment years 1980-81 and 1981-82, with the Income-tax Officer completing the assessment u/s 143(1) of the Income-tax Act, 1961. Subsequently, proceedings were initiated u/s 147(a) due to income from Hullar Rice Mill assessed in an individual's name in earlier years. Despite issuance of notices u/s 148, lack of response from the assessee led to further actions. The Appellate Assistant Commissioner upheld the assessment, prompting an appeal to the Tribunal, which remanded the matter for fresh consideration. The subsequent dismissal of appeals by the Deputy Commissioner led to a second appeal before the Tribunal. After reviewing the case, the Tribunal sought a remand report and concluded that while notices u/s 148 were issued, there was no proof of service on the assessee, resulting in cancellation of the assessments for both years. The matter was referred to the High Court to determine if the assessee had sufficient notice u/s 148. The High Court emphasized that service of notice u/s 148 is a prerequisite for reassessment proceedings u/s 147, citing legal precedents. It was noted that appearance in response to a notice u/s 142(1) does not imply knowledge of proceedings u/s 147. Consequently, it was held that no notice was served u/s 148, and appearance based on a different notice does not equate to awareness of proceedings u/s 147. The judgment favored the assessee, leading to the disposal of the income-tax reference.
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