1940 (4) TMI 30 - HC - Income Tax

Summary

Issues:
1. Whether a reference lies from the orders of the Commissioner of Income-tax dated October 26, 1938?
2. Whether there was any material before the Commissioner of Income-tax to show that the assessment for the year 1931-32 was made without due notice to the assessee?
3. Whether there was any material to show that notices had been served in accordance with the Act and that the assessee was bound by them?

Analysis:

Issue 1:
The judgment addresses the question of whether a reference lies from the orders of the Commissioner of Income-tax dated October 26, 1938. The Commissioner declined to review the assessment of the assessee as there was no material to proceed satisfactorily. The assessee claimed that assessments were made without his knowledge, but this claim was found against him by the Commissioner. The Court refers to the case law to establish that the assessee has the right to call the attention of the Commissioner to a prejudicial order and request action to be taken. The Court concludes that the Commissioner acted within his discretion and that there was no order prejudicial to the assessee, hence no grounds for a reference to be made.

Issue 2:
Regarding the second issue of whether there was any material to show that the assessment for the year 1931-32 was made without due notice to the assessee, the judgment highlights that the Commissioner has the power to review a case based on suggestions from interested parties, with the assessee being the most interested party. The Court emphasizes that the Commissioner's power of review is discretionary, and in this case, the review did not alter the existing position to the prejudice of the assessee. Therefore, there is no legal question arising out of the order itself, and the Court finds no grounds for a reference to be made based on this issue.

Issue 3:
The third issue pertains to whether there was any material to show that notices had been served in accordance with the Act and that the assessee was bound by them. The judgment clarifies that a reference shall lie from an order under Section 33 only on a question of law arising from that order itself. The Court concludes that there is no question of law arising from the Commissioner's order, as he conducted the necessary inquiry and made appropriate orders. As a result, there are no grounds for any reference to be made based on this issue.

In summary, the judgment dismisses the possibility of a reference based on the Commissioner's orders dated October 26, 1938, as there were no prejudicial orders against the assessee. The Court emphasizes the discretionary power of the Commissioner in conducting reviews and concludes that there are no legal questions arising from the orders, thereby resolving all three issues in favor of the Commissioner and dismissing the need for a reference.