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Issues Involved:
1. Validity of the impugned notice dated March 30/31, 1989, issued u/s 148 of the Income-tax Act, 1961. 2. Authority of the second respondent to issue the letter dated February 8, 1989, and the impugned notice dated March 30/31, 1989. Summary: Issue 1: Validity of the Impugned Notice The petitioner challenged the notice dated March 30/31, 1989, issued by the Deputy Commissioner of Income-tax (Assessment), Special Range-II, Guwahati, u/s 148 of the Income-tax Act, 1961, for reassessment of income for the assessment year 1985-86. The petitioner argued that all necessary material facts were disclosed during the original assessment, and there was no new information justifying the reopening of the assessment. The court noted that the return filed by the petitioner included audited profit and loss accounts, balance sheets, and details of advances received from the Forest Utilisation Officer. The assessment was completed after due verification of these documents. The court held that the impugned notice was vague and lacked specific grounds for the belief that income had escaped assessment. Consequently, the notice was deemed illegal, void, and without jurisdiction, and thus, it was set aside and quashed. Issue 2: Authority to Issue Notices The petitioner contended that the second respondent, who issued the letter dated February 8, 1989, and the impugned notice dated March 30/31, 1989, was not the competent authority to do so. The court examined the provisions of the Income-tax Act, specifically sections 2(25), 117, 139, 142, 143, 144, and 147. It was found that the power to issue notices u/s 148 and initiate proceedings u/s 147 is vested in the Income-tax Officer, as defined and appointed under the Act. The court concluded that the respondents failed to demonstrate that the Assistant Commissioner or Deputy Commissioner was appointed as Income-tax Officers by the Central Government. Therefore, the issuance of the notices and initiation of proceedings were not by a competent authority under the law. Consequently, the court set aside the letter dated February 8, 1989, and the notice dated March 30/31, 1989, along with the proceedings initiated u/s 147. Conclusion: The petition was allowed, and the impugned notices and proceedings were quashed due to lack of jurisdiction and authority, with no order as to costs.
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