1973 (1) TMI 6

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..... . Thereafter, proceedings for regular assessment were initiated and an assessment order under section 23(4) of the Act was passed on March 28, 1959, and a notice of demand was issued after adjusting the amount paid by the assessee in pursuance of the assessment under section 23B of the Act. On a petition under article 226 of the Constitution filed by the assessee, the assessment order dated March 28, 1959, was quashed by this court on the ground that as the assessee had filed a voluntary return, a notice under section 22(4) could not be issued and the non-compliance with such a notice could not justify an assessment under section 23(4) of the Act. Thereafter, the Income-tax Officer resumed the assessment proceedings and issued a notice unde .....

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..... his order dated March 23, 1967, and the correctness of that order has been challenged through this appeal. The only question for consideration is whether the appellant is entitled to refund of the tax paid by him in pursuance of the notice of demand issued following the assessment under section 23B of the Act. The contention raised by the appellant is that a provisional assessment of tax under section 23B is merely a step in the process of making a regular assessment under section 23 and its identity comes to an end as soon as the regular assessment is made. If the regular assessment is found to be invalid, the assessee is not liable to pay any tax for that assessment year and any sum paid in pursuance of an assessment made under section .....

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..... stinct proceeding. It is described as a provisional assessment only for the purpose of indicating that it is provisional as to the amount of tax payable and that it does not preclude a regular assessment determining the tax liability finally. The contention raised by the appellant is that by virtue of sub-section (7) of section 23B of the Act the amount paid towards a provisional assessment assumes the character of a payment made towards a regular assessment as soon as a regular assessment is made under section 23 of the Act and if the regular assessment is rendered invalid, the liability of the assessee to pay any tax ceases and he is entitled to refund of the amount paid in pursuance of the provisional assessment. We are unable to accep .....

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