KAMALA DEVI TODI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE reference relates to the assessment years 1962 -63 and 1963 -64. Lalchand Todi is the assessee. He was a partner of a firm called Tinsukia Flour Mill.

(2.) THE assessee was served with a notice on August 11, 1966, under section 142(1) for production of books of account. The assessee represented that on August 10, 1986, a mob broke into the office of the firm at 11 a.m., ransacked the books of account for five hours and burnt the books of account, other records and properties worth Rs. 5,000. The assessee, therefore, was unable to submit the books of account at the inquiry by the Income -tax Officer. The assessment orders for the years 1962 -63 and 1963 -64 were finalised without books of account under section 144 of the Act. The assessee filed, unsuccessfully, appeals before the Appellate Assistant Commissioner and before the Appellate Tribunal. Later, under sub -section (2) of section 256 of the Income -tax Act, the following two questions are referred to this court :

(3.) WE have earlier referred to the fact that when the assessee was served with a notice to cause production of account books, he stated that the books were not available for they were burnt in arson and riots which occurred on August 10, 1966. The issue, in such circumstances, is whether the assessee was entitled to further notice under section 143(2). The Revenue in this case argued that the assessment is not made under clause (c) of section 144 of the Income -tax Act and that, therefore, no notice need be served on the assessee. Speaking of procedure under the Act, the assessee filed the return and the return was not accepted by the Income -tax Officer. He held an inquiry and passed an assessment order. The assessee contends that clause (c) of section 144 applies as the return filed by the assessee is varied or concluded to the detriment of the assessee and that, therefore, he is entitled to a notice under section 143(2) of the Act. At the relevant time section 143 of the Act, sub -section (2), was in the following terms :