CHIRANJI LAL Vs. INCOME TAX OFFICER NEW DELHI

JUDGEMENT

(1.) Petitioner-firm Chiranji Lal Ramji Dass by means of this petition under Articles 226 and 227 of the Constitution of India has prayed for the issuance of a writ quashing notice dated March 21, 1966 under Section 148 of the Income- tax Act, 1961 (hereinafter referrd to as the Act of 1961).

(2.) The petitioner-firm was carrying on business as a Commission Agent in the status of a Hindu undivided family during the accounting period (Dewali year 1947-48) pertaining to the assessment year 1949-50. The Hindu Undivided family remained joint in status and business up to November 13, 1955, thereafter the profits arising from the business were assessed in the status of a registered firm. Previously the head office was at Bhiwani with branch offices at Narnaul, Bikaner, Loharu and Jaipur. After 1955, the business is carried on with head office at Bhiwani and branches at Jaipur, Bikaner, Delhi and Narnaul. On March 21, 1966 Income-tax Officer, Central Circle III, Delhi issued the following notice under Section 148 of the Act of 1961 to the petitioner:-

(3.) The petition has been resisted by respondents I to 3 and the affidavit of Shri V. S. Rastogi, Income-tax Officer has been filed in opposition to the petition. According to the affidavit filed on behalf of the respondents, notice under Section 148 was validly issued on the basis of information coming into the possession of the Income-tax Officer that by reasons of the omission or failure on the part of the assessee to disclose fully and truly all material facts, necessary for the assessment, income over Rupees one lakh chargeable to tax had escaped assessment for the assessment year 1949-50. Before dealing with the contentions advanced, it would be necessary to reproduce the relevant provisions of the Act of 1961 as well as those of Income-tax Act, 1922 (11 of 1922) (hereinafter referred to as Act of 1922). The relevant portion of Sec. 34 of the Act of 1922, as it stood immediately prior to its amendment by the Finance Act, 1956 was in the following terms:-