9911796707
TMI Blog1965 (9) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... at year amounted to ₹ 5,326. The assessee was assessed for the first time for the assessment year 1947-48 and so far as the prior assessment years including the assessment year 1946-47 were concerned, no notice was issued to the assessee under section 22(2) nor did the assessee file any return of his income and no assessment was made on the assessee for those assessment years. It appears that some time after the assessment for the assessment year 1947-48 was completed, the Income Tax Officer received information that the assessee had made large deposits in his current deposits accounts with the Central Bank of India Limited and the Bank of India Limited in the earlier assessment years including the assessment year 1946-47 and since th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see carried the matter in appeal to the Appellate Assistant Commissioner. Two grounds were raised before the Appellate Assistant Commissioner : one was that the assessment under section 34(1)(a) was invalid since the assessee had already filed voluntary return before the issue of the notice under section 64(1)(a) and the second was that the addition of ₹ 49,800 made by the Income Tax Officer was improper and unjustified. The first ground was rejected by the Appellate Assistant Commissioner but, so far as the second ground was concerned, the Appellate Assistant Commissioner gave relief to the assessee to the extent of ₹ 10,800. The assessee thereupon preferred an appeal to the Tribunal. The Tribunal, relying upon the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by reason of the omission or failure on the part of the assessee to make a return of his income under section 22 for the assessment year 1946-47, the income of the assessee had escaped assessment. Before the notice was issued by the Income Tax Officer, the assessee submitted a voluntary return of income showing a net income of ₹ 1,217 which was below the taxable limit. The question is whether the submission of this voluntary return precluded the Income Tax Officer from issuing notice under section 34(1)(a). At one time there was a sharp conflict of opinion between the Bombay High Court on the one hand and the Calcutta High Court on the other whether a voluntary return disclosing income below the taxable limit could be regarded as a va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under sub-section (1) or sub-section (2), he may furnish a return at any time before the assessment is made. This provision postulates that the return must be filed at a point of time when the assessment can be lawfully made and therefore it must follow that the return to be a valid return under section 22(3) must be filed before the expiration of the time limited for making an assessment under section 23. Now under section 34(3), except in certain limited cases, which are not relevant for the purpose of the present reference, the normal period of limitation for making an assessment is four years from the end of the assessment year. It would, therefore, appear that a return under section 22(3) must be filed at the latest before the expirat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : This notice was improper, because with the return already filed, there was neither an omission nor a failure on the part of the assessee nor was there any question of assessment escaping. But where the voluntary return is submitted by the assessment after the expiration of the period of four years from the end of the assessment year, the position would be clearly different. In such a case the period of four years having expired, the Income Tax Officer would have no jurisdiction to proceed to assess the assessee in the ordinary way under section 23 (without invoking the aid of section 34(1)(a)) by reason of section 34(3) and the submission of the voluntary return would be futile. The result would be that the income of the assessee would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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