9911796707
|
Home
Issues:
Validity of assessments under section 34 of the Indian Income-tax Act for the assessment years 1954-55 and 1955-56. Analysis: The case involves assessments on an educational institution for the years 1954-55 and 1955-56. The Income-tax Officer did not issue notice under section 22(2) but the institution voluntarily submitted returns. Subsequently, the officer issued notice under section 22(2) read with section 34, leading to an assessment based on estimated income. The main challenge was that the proceedings under section 34 were misconceived and incompetent. The question referred was whether the assessments under section 34 were valid in law. The court found that the initiation of proceedings under section 34 was incompetent since the institution had voluntarily submitted returns before assessment. Citing precedent, the court held that a voluntary return in response to a general notice is valid and can be filed before assessment without any time limit. The court emphasized that where a voluntary return has been submitted, the Income-tax Officer cannot ignore it and proceed with reassessment under section 34. Referring to previous judgments, the court reiterated that if a return has been voluntarily submitted and not assessed, initiating proceedings under section 34 is impermissible. Despite the officer's error in issuing a notice under section 34, the assessment based on the voluntary return was considered valid. The court emphasized that the jurisdiction of a tribunal does not depend on the provisions of law cited but on whether it had jurisdiction under the law. Quoting the Supreme Court, the court emphasized that the exercise of power must be referable to a jurisdiction that confers validity. In conclusion, the court held that the assessments under section 34 were valid in law, ruling against the assessee who was directed to pay the costs of the department.
|
