1970 (8) TMI 28

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..... otice
Judge(s) : K. L. ROY. ORDER K. L. ROY J. - The petitioner in this application is entitled to succeed on the basis of the reasons given by the Income-tax Officer for purporting to reopen the assessment of the petitioner for the assessment year 1960-61 under section 147(a) of the Income-tax Act, 1961. The facts shortly are that the petitioner was assessed by the Income-tax Officer, " J " Ward, District I(1), Calcutta, in respect of the assessment year 1960-61 on a total income of Rs. 8,682. It also appears that the assessee's wife, Smt. Chandra Kant Periwal, purported to invest Rs. 35,000 in a partnership firm styled " Rajasthan Knitting Mills " as her capital contribution for becoming a partner in that firm with a four annas sha .....

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..... in his hands under section 64 of the Act of 1961. The assessment of the petitioner for the year 1964-65 was completed on the 18th March, 1969, and therein the share of the profit of the petitioner's wife from M/s. Rajasthan Knitting Mills was included under section 64 of the Act. By a notice under section 148 dated the 28th March, 1969, the respondent-Income-tax Officer proposed to reassess the petitioner's income for 1960-61 and required the petitioner to file his return for that year within 30 days from the date of the receipt of the notice. It was further stated in the notice that it was being issued after obtaining the necessary satisfaction of the Commissioner of Income-tax, West Bengal III, Calcutta. Dr. D. Pal, the learned counsel .....

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..... section 147(a) in accordance with the aforesaid decision of the Supreme Court. The learned counsel for the department argued that the reference to section 64 in the respondent-Income-tax Officer's letter, dated the 17th February, 1969, was in connection with the petitioner's assessment for 1964-65, and in that assessment the wife's income was included under that section. In attempting to reopen the assessment for 1960-61, the department's case is that the said amount of Rs. 35,000 belonged to the petitioner and the petitioner invested it in the name of his wife, that is, as his benamidar, and any income arising therefrom is the income of the petitioner. There is no question of the application of section 64 in this case. During the opening .....

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..... y income arising therefrom is the petitioner's income and in not disclosing such income the petitioner has failed to disclose material particulars for his assessment. But, in view of the reasons recorded, the ratio of the aforesaid decision of the Supreme Court must be held to apply and that the impugned notice under section 148 must be struck down as not authorised by law. Accordingly, the rule is made absolute. The notice under section 148 is quashed and the respondents are prohibited from taking any further steps in respect of the aforesaid notice. There will be no order as to costs. The operation of this order would be stayed till two weeks after the vacation. The interim order would continue in the meantime.
Case laws, Decisions .....

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