9911796707
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Issues:
1. Jurisdiction of the 1st respondent to issue notices under s. 15 of the Excess Profits Tax Act, 1940 after a lapse of 24 years without definite information of escaped assessments. Analysis: The petitioner, a company assessed under the Excess Profits Tax Act, disputed the assessments for the calendar years 1941 and 1942. The Income Tax Officer (ITO) concluded that s. 10A of the Act did not apply to the petitioner's business and two private companies in Ahmedabad. The EPTO issued notices to the private companies under s. 10A, leading to adjustments in their assessments. The companies appealed, and the Tribunal set aside the orders under s. 10A, stating that if the provision should apply, notices must be issued to all three companies to determine the purpose of incorporation. The Tribunal disposed of the appeals on February 11, 1950. After 24 years, the petitioner received a notice under s. 15 of the Act from the 1st respondent for reassessment. The notice claimed that profits had escaped assessment based on "definite information." The petitioner challenged the legality of the notices, arguing that the Tribunal's observations did not constitute definite information. The Court agreed, stating that the Tribunal's remarks were not sufficient grounds for reassessment. The Court found the 1st respondent's actions to be misconceived and irregular, leading to the quashing of the notices. In conclusion, the Court ruled in favor of the petitioner, quashing the notices issued by the 1st respondent. The Court held that the observations of the Tribunal did not amount to definite information of escaped assessments, rendering the reassessment invalid. The petitioner succeeded in challenging the jurisdiction of the 1st respondent to issue notices under s. 15 after a significant lapse of time without concrete evidence of escaped profits.
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