1962 (10) TMI 89 - HC - Income Tax

Summary

Issues:
Determining the initiation of assessment proceedings for application of court fees act.

Analysis:
The judgment addresses the issue of when assessment proceedings are considered initiated for determining the applicability of the court fees act to applications under section 66(2) and section 66(3) of the Income-tax Act. The court considered arguments regarding the initiation of proceedings, with one side suggesting it begins with the public notice under section 22(1) or when the Income-tax Officer calls for evidence, while the other side argued for the initiation upon filing a return or receiving an individual notice under section 22(2). The court referred to a Supreme Court case emphasizing that the right of appeal accrues at the initiation of proceedings, not at the decision stage. It was concluded that proceedings are initiated when the assessee files a return or receives a notice under section 22(2), preceding the assessment order. In the specific case, the notice under section 22(2) was issued before the new Court Fees Act came into force, indicating the initiation of proceedings under the old Act.

The judgment delves into the concept of initiation of proceedings, emphasizing that it occurs when a party presents its case to the Tribunal for adjudication or when the Tribunal summons the party for inquiry and decision-making. It rejects the notion that proceedings start with the public notice under section 22(1), stating it merely sets the stage for proceedings without targeting individual assesses. The court highlights that proceedings truly commence when the assessee submits a return or upon receiving a notice under section 22(2). The argument that the controversy arises at the stage of notice under section 23(2) was dismissed, reiterating the Supreme Court's stance that the right of appeal accrues at the initiation of proceedings. The judgment emphasizes that the initiation of proceedings predates the actual controversy or lis, and the right of appeal is determined at the commencement of proceedings, even if the lis arises later in the process or upon the final order.

In conclusion, the judgment clarifies that the initiation of assessment proceedings, for the purpose of determining the applicable court fees act, occurs when the assessee files a return or receives a notice under section 22(2). The court's interpretation aligns with the principle that the right of appeal accrues at the initiation of proceedings, emphasizing that the date of initiation precedes the actual controversy or lis. In the specific case discussed, the initiation of proceedings was deemed to have taken place before the enactment of the new Court Fees Act, thus subjecting the reference to the old Act.