COMMISSIONER OF INCOME TAX Vs. BANKIPUR CLUB LIMITED

JUDGEMENT

(1.) THESE four cases arising out of references under section 66 (1) of the Indian Income-tax Act, 1922, were heard together as common questions are involved in all the cases and the references in question arise out of proceedings relating to the assessment of the same assessee, namely, Messrs. Bankipur Club Ltd., Patna, which is the opposite party in all the cases. THESE four cases, that is case Nos. 10 and 11 of 1965 and 14 and 15 and 1959-60. It is admitted that the assessee duly submitted its return in each of these years showing its income as "nil" and claiming that, as it was a members club, its receipts from its own members were not taxable. Its balance-sheets, profit and loss accounts and books of accounts for the relevant accounting periods were duly produced before the Income-tax Officer and, so far as the assessment year 1956-57 is concerned, the Income-tax Officer accepted the assessees contention and made an order on November 14, 1957, determining the income as "nil". Similarly, the Income-tax Officer accepted the assessees contention with respect to the other three years also, namely, 1957-58, 1958-59 and 1959-60, and so far as these three years are concerned, he passed the following orders for each of the years"Returns filed.

(2.) THE assessee has no business income and income from property during the year. THE case is filed."

(3.) TURNING now to the facts of the present case, it may be mentioned at the outset that it was conceded before us on behalf of the opposite party that the words escaped assessment, as used in section 34 (1) (b) include cases in which there has been no assessment of a particular income owing to authority, although the return was duly filed by the assessee and there was no suppression of any facts by him. As held, however, by the Supreme Court in the case of Maharaj Kumar Kamal Singh v. Commissioner of Income-tax, two conditions must be satisfied before the Income-tax Officer can act under section 34 (1) (b).