COMMISSIONER OF INCOME TAX Vs. A K DAS

JUDGEMENT

(1.) The Income-tax Appellate Tribunal has referred two points of law in the following manner, for answer by this court under Section 256(1) of the Income-tax Act, 1961:

(2.) The facts of this reference as appearing in the statement of the case may be briefly summarised as follows : The assessee is an individual. The assessment years concerned in this reference are 1955-56 to 1962-63. The original assessments for these years were completed on the basis of the returns filed by the assessee. Subsequently, some time in 1963 the Income-tax Officer received information that during these years there were substantial deposits in the assessee's account in the Hindustan Commercial Bank Ltd., Netaji Subhas Road Branch, amounting to about Rs. 2,26,000. The Income-tax Officer required the assessee to explain the deposits in his account in the said bank. Thereafter, the assessee made full disclosure of the deposits either in his name or in the names of other persons in this account during those assessment years to the extent of Rs. 3,70,208. What is more, the assessee also admitted that these were his concealed income.

(3.) The Income-tax Officer took proceedings under Section 147 of the Income-tax Act, 1961, for reassessment of the assessee's escaped income for these years. In response to the notices issued, the assessee filed returns giving full details of the deposits in his bank account in respect of those years. The Income-tax Officer passed orders of assessment under Section 143(3)/147 for the assessment years 1955-56 to 1962-63 on the 31st August, 1964, on the basis of the returns filed by the assessee. From the orders of penalty of the Inspecting Assistant Commissioner it appears that the total escaped income assessed in those reassessment proceedings came to Rs. 4,29,624 and the tax sought to be evaded in respect thereof came to Rs. 3,21,820. The Income-tax Officer in the assessment orders made on the 31st August, 1964, recorded that proceedings under Section 271(1)(c) have already been started separately. From the order-sheet of such assessment proceedings it also appears that on the 31st August, 1964, the Income-tax Officer gave direction for issue of show cause notice under Sections 274/271. There is also an entry in the order-sheet dated 29th August, 1964, to the effect that notice under Sections 271/274 was issued to the assessee and the cases were referred to the Inspecting Assistant Commissioner. It also appears from the statement of the case that a copy of the aforesaid notice dated 29th August, 1964, was served on Shri B. B. Das, the assessee's accountant and authorised representative, who was present in the income-office and the receipt of such notice had been acknowledged by the said Shri B. B. Das by putting his signature on a copy thereof. The intimation regarding the transfer of the case was received at the Inspecting Assistant Commissioner's office on the 29th August, 1964. It also appears that a further notice was issued by the Income-tax Officer under Section 274(1) requiring the assessee to show cause why the penalty should not be imposed and the hearing was fixed on the 22nd September, 1964. The demand notices in respect of the reassessment for the years 1955-56 to 1962-63 were served on the assessee on the 12th September, 1964, while assessment orders for these years were received by the assessee on the 24th September, 1964.