ABDUL RAB ABDUL SALAM Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THESE two writ petitions are filed by a partnership firm called Abdul Rab Abdul Salam. The firm was constituted on July 1, 1965, with four partners. Two among the partners are indicated in the firms name. The other two are Abdul Barik and Abdul Jabbar. The firm was reconstituted on April 1, 1969, and four more partners were inducted on that day. The main office of the firm is at Tinsukia in Assam and a branch at Sonari in Sibsagar District and another branch at Calcutta in the State of West Bengal. The firm deals in stationery, readymade goods and is the agent of Bata Shoe Company at all the three places of business. The issue raised in the two civil rules pertain to the income-tax assessment orders of the firm for the assessment years 1968-69 and 1969-70. The circumstances which prompted the firm to file the two civil rules are set out below and also as to what has preceded the impugned notices and as to why the Revenue has served the two notices on the firm On June 6, 1968, the assessee was called upon to submit a return for the assessment year 1968-69 under sub-section (2) of section 139 of the Income-tax Act. In response to it, the assessee (the firm) filed the return showing an income of Rs. 46,465. This amount was later revised to Rs. 73,300. For the assessment year 1969-70, the assessee filed a return after a like notice by the Revenue showing an income of Rs. 1,08,030. In the inquiry held, the assessee produced books of account and filed the profit and loss account and balance-sheet for each accounting year of she main office and two branches. On September 27, 1971, the Income-tax Officer finalised the orders for the assessment years 1968-69 and 1969-70 and on that day also for the assessment year 1967-68.

(2.) THE impugned notices were served on the assessee by the Income-tax Officer to reopen the assessments for 1968-69 and 1969-70. THEreupon, the assessee approached this court to quash the two notices. What prompted the Revenue to reopen the assessments is connected with the events that had transpired in the Enforcement Branch of the Sales Tax Department. THE head office of the assessee at Tinsukia was searched and in that search account books were seized. It was found that enormous turnover of the business of the assessee was discovered by the Sales Tax Department to have escaped assessment. THErefore, the assessment orders were revised including the assessments orders relevant to income-tax assessment years 1968-69 and 1969-70.

(3.) WE may here at the outset mention one aspect relevant to the bar of limitation raised by the assessee. It is seen that the two assessment orders were finalised on September 27, 1971, and from the above data, one of the questions raised by the assessee relating to the assessment order of 1968-69 is that the notice was served on October 20, 1973, after four years and that therefore, the notice is time-barred under clause (b) of section 147 of the Act. As far as the assessment order relating to 1969-70 is concerned, notice is not assailed as time-barred. WE hold that no question of bar of limitation arises in either of the cases as the impugned notices are served on facts under clause (a) of section 147 and not under clause (b) of section 147 .