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Issues:
Challenge to notices issued under section 148 of the Income-tax Act, 1961 for assessment years 1966-67 and 1970-71 to 1973-74 based on best judgment assessments and protective assessments. Contention regarding income assessment in the hands of Hindu undivided family versus individual assessment. Legal representative's failure to produce evidence of property ownership and exchange. Escapement of income assessment and correct status determination. Validity of notice issued to one heir of the legal representative. Analysis: The judgment of the High Court of Calcutta, delivered by Justice Sabyasachi Mukherjee, pertained to a challenge against notices issued under section 148 of the Income-tax Act, 1961 for assessment years 1966-67 and 1970-71 to 1973-74. The notices were directed at the legal heir and representative of Prem Gopal Bhandari, challenging the income assessment previously made in the status of a Hindu undivided family (H.U.F). The Income-tax Officer contended that the income belonged solely to Prem Gopal Bhandari as an individual, based on the assessment order and lack of evidence regarding property ownership and exchange. The legal representative failed to produce original deeds of property exchange, leading to doubts about the ownership and status of the income. The counsel for the assessee argued that the income had already been assessed in the hands of the Hindu undivided family, and therefore, there was no escapement of income assessment. However, the court disagreed, stating that if the income truly belonged to the individual, then it had indeed escaped assessment. The court emphasized that the correct status determination was crucial, and if the income belonged to a different entity, it should be properly assessed under section 148 of the Income-tax Act. The court cited relevant case laws to support its decision, highlighting the importance of accurate income assessment based on ownership and status. Regarding the validity of the notice issued to only one heir of the legal representative, the court held that this issue could not be challenged by the petitioner who had been served with the notice. The court explained that any challenge to the notice should be raised by other heirs of Prem Gopal Bhandari. The court dismissed the application, discharged the rule nisi, and vacated any interim order, with no order as to costs. The operation of the order was stayed for four weeks, concluding the judgment on the challenge to the reopening based on the issues raised and analyzed in the case.
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