1989 (8) TMI 112 - AT - Income Tax

Summary

Issues:
1. Validity of notice issued under section 148 of the Income-tax Act, 1961.
2. Charging of interest under sections 139(8) and 217.
3. Jurisdiction of the Tribunal to consider the validity of action under section 148.

Detailed Analysis:
1. The case involved an appeal by the legal heir of a deceased assessee for the assessment year 1966-67, challenging the legality of the notice issued under section 148 of the Income-tax Act, 1961. The appellant contended that the notice was illegal, void, and without jurisdiction. Additionally, the issue of charging interest under sections 139(8) and 217 was raised, with an attempt to connect it to the main issue by arguing that since the notice under section 148 was not heard, no interest should be chargeable. The Tribunal noted that the assessment under section 144 was completed on a certain date, subsequently reopened under section 146, and a fresh assessment was made. The Tribunal held that the appellant had the opportunity to challenge the original assessment under section 144 by filing an appeal, but failed to raise the issue of illegality at that time. The Tribunal emphasized that the appellant missed the opportunity to challenge the original assessment and could not raise the invalidity of the notice under section 148 at a later stage.

2. The Tribunal further explained that section 146(1) of the Income-tax Act mandates the Income Tax Officer to cancel the assessment and make a fresh assessment if certain conditions are satisfied. The Tribunal pointed out that the provisions of section 146 were invoked at the instance of the appellant, who filed an application under this section. The Tribunal concluded that the question of the invalidity of the notice under section 148 could not be raised separately as the appellant had the opportunity to challenge the original assessment through proper channels. The Tribunal found that the appellant's attempt to introduce new facts and arguments through a miscellaneous petition was misconceived and rejected the petition.

3. The Tribunal highlighted the importance of ensuring that justice is not only done but also seen to be done. Due to the rejection of the miscellaneous petition, the draft statement was held up for annexures. The Tribunal advised the appellant's counsel to provide the annexures within a specified timeframe so that the statement of the case could be sent to the High Court. Ultimately, the miscellaneous petition was rejected, bringing the matter to a close as per the Tribunal's decision.