1933 (10) TMI 16 - HC - Income Tax

Summary

Issues:
1. Assessment without issuing a notice under Section 22(4) as an assessment to the best of judgment under Section 23(4).
2. Legality of issuing a notice of Demand under Section 29 for an assessment made under Section 23(4).
3. Completeness of a return made under Section 22(2) without signatures and verification.

Analysis:
1. The first issue raised in the judgment pertains to the connection between Section 22(4) and Section 23(4) of the Income Tax Act. The court clarified that Section 23(4) applies in cases of failure to make a return under Section 22(1) or (2) or non-compliance with a notice issued under Section 22(4). It was emphasized that not every case under Section 23(4) requires non-compliance with Section 22(4) for its application.

2. The second issue addressed the legality of issuing a notice of Demand under Section 29 for an assessment made under Section 23(4). The court discussed the language used in different sub-sections of Section 23, highlighting that the power to determine the sum payable by the assessee is implicit in Section 23(4). The court rejected the argument that the Income Tax Officer lacks the authority to calculate the tax payable based on a best judgment assessment.

3. The final issue involved the completeness of a return made under Section 22(2) without signatures and verification. The court compared this situation to rulings on civil suits but concluded that the specific requirements of the Income Tax Act must be met. Emphasis was placed on the prescribed form and verification of the return, with previous cases cited where the absence of proper verification and signature justified best judgment assessments under Section 23(4).

In conclusion, the court found in favor of the Income Tax Department on all points, directing the assessee to pay costs and ruling that the defects in the return did not fall under Section 23(2) regarding incomplete returns. The judgment provided a detailed analysis of the legal provisions and past precedents to support its conclusions, ensuring a thorough examination of the issues at hand.