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TMI Blog1971 (1) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... ction contracts under the Railways as well as the Government. It is a partnership firm. For the assessment year 1960-61, relevant to the accounting year 1959-60, after the assessee submitted its income-tax return, it was asked by the Income-tax Officer during the income-tax assessment proceedings to produce before him its books of account and the other relevant papers. The assessee also produced before him a statement showing various creditors from whom it had borrowed on hundis during the accounting year in question. In that statement it gave the full names and addresses of the alleged creditors. After enquiry, the assessee's total income was assessed at Rs. 69,886. On June 3, 1966, the first respondent (Income-tax Officer, Ward " A ", Muz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on behalf of the assessee. In this case the notice was issued after four years but before eight years of the date of the original assessment. Section 151(2) of the Act reads : " No notice shall be issued under section 148 after the expiry of four years from the end of the relevant assessment year, unless the Commissioner is satisfied on the reasons recorded by the Income-tax Officer that it is a fit case for the issue of such notice." Section 148 prescribes : " (1) Before making the assessment, reassessment or recomputation under section 147, the Income-tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub-section (2) of section 139 ; and the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... January, 1971, only the report submitted by the Income-tax Officer to the Commissioner and the order of the Commissioner was produced. The order sheet recording the reasons of the Income-tax Officer as required by section 148(2) was not produced. Hereinbelow, we have set out the report of the Income-tax Officer as well as the order of the Commissioner : " Report in connection with the starting of proceedings under section 147 of the Income-tax Act, 1961. Name of district Ward or Circle ............ A-Ward, Muzaffarpur G. I. R. No ................ 303-C. 1. Name and address of the assessee --- M/s. Chugamal Rajpal, Muzaffarpur 2. Status --- R. F. 3. Assessment year for which notice --- under s. 148 is proposed to be issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icharan. 2. Lakha Singh Lal Singh. 3. Radhakissen Shyam Sunder. The amount of escapement involved amounts to Rs. 1,00,000. Sd. S. P. Chaliha, 30-4-66. Income-tax Officer, A-Ward, Muzaffarpur." In his report the Income-tax Officer does not set out any reason for coming to the conclusion that this is a fit case to issue notice under section 148. The material that he had before him for issuing notice under section 148 is not mentioned in the report. In his report he vaguely refers to certain communications received by him from the Commissioner of Income-tax, Bihar and Orissa. He does not mention the facts contained in those communications. All that he says is that from those communications " it appears that these persons ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to tax has escaped assessment for any assessment year. Unless the requirements of clause (a) or clause (b) of section 147 are satisfied, the Income-tax Officer has no jurisdiction to issue a notice under section 148. From the report submitted by the Income-tax Officer to the Commissioner, it is clear that he could not have had reasons to believe that by reason of the assessee's omission to disclose fully and truly all material facts necessary for his assessment for the accounting year in question, income chargeable to tax has escaped assessment for that year ; nor could it be said that he, as a consequence of information in his possession, had reasons to believe that the income chargeable to tax has escaped assessment for that year. We ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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