1973 (3) TMI 15 - HC - Income Tax

Change of opinion - Notice Of Reassessment - This is an application made by the petitioner for the issue of a writ in the nature of mandamus commanding the respondent to withdraw or cancel the notice dated March 19, 1969, issued under section 148 of the Income-tax Act, 1961, for the assessment year 1960-61. The application also seeks for the issue of a writ in the nature of certiorari, inter alia, for quashing or setting aside the said impugned notice.

Summary

Issues:
- Application for writ of mandamus and certiorari regarding notice under section 148 of the Income-tax Act, 1961 for assessment year 1960-61.

Analysis:
The petitioner, a registered partnership firm, sought a writ of mandamus and certiorari to withdraw or cancel a notice issued under section 148 of the Income-tax Act, 1961 for the assessment year 1960-61. The notice required the petitioner to submit a fresh return for the same assessment year based on certain reasons provided by the Income-tax Officer. The reasons cited for issuing the notice included the discovery that certain hundi loan transactions of the petitioner were found to be bogus during subsequent assessment proceedings. However, the court noted that the reasons disclosed did not establish any material to indicate that the income had escaped assessment due to the petitioner's failure to disclose relevant facts. The court concluded that the issuance of the notice was based on a change of opinion rather than the discovery of new material, thereby wrongfully exercising jurisdiction. Consequently, the court held that the conditions for issuing the notice under section 148 of the Income-tax Act were not met, and the impugned notices were unsustainable. As a result, the application for the writ succeeded, and the rule nisi was made absolute with a stay of operation of the order for eight weeks.