PROTAP CHANDRA GANGULY Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) The assessee in this case received a notice under Sub-section (2), Section 22, Income-tax Act, requiring him to lodge a return of his income by 2 June, 1927, No return was filed by that date; but, on 4 June, the assessee filed an application through his pleader asking the income-tax officer to give him time till 4 August. The income-tax officer gave him time till 25 July and, on 25 July, the assessee failed to file any return. Two days later, on 27th July, his pleader appeared before the income-tax officer and said that, as he had to leave Calcutta, he could not submit his return. The income-tax officer said that he could not wait and must finish the assessment there and then. Further adjournment was therefore refused. On that date an assessment was made by the income-tax Officer under Clause (4), Section 23, in default of the filing of return. It is quite clear under the Income-tax Act, that, although an assessee is late in filing his return, nevertheless if he does file it; before the assessment is actually made; the return has to be considered and dealt with although out of time.

(2.) In this case however the assessment was made within the meaning of Sub-section (4), Section 23, on 27 July by which time no return had been filed. On the next day, the assessee came along with his return, but no action could be taken upon that as an order of assessment upon a different basis altogether had already been made. A notice of demand was issued upon the basis of the order of assessment and this notice of demand appears to be inaccurate in respect that it did not make clear that the assessment had been made in default of filing a return as distinct from certain other defaults. However that notice of demand operated nothing. It was cancelled and a fresh notice issued. A demand notice to an assessee is simply a notice which apprises him of the previous fact, namely, that he had been assessed at a certain amount.

(3.) In this position, the assessee submitted several petitions; but, in particular, ho appears to have submitted an application before the income-tax officer under Section 27. It was quite open to the income-tax officer to entertain the application showing that the delay in filing the return was due to sufficient cause and that the assessee should be given the benefit of an order cancelling the assessment of 27 July and directing the assessment to be reopened. The income-tax officer however dealt with that matter on the facts, found no sufficient cause and rejected the application. From this order, an appeal was taken to the Assistant Commissioner. The Assistant Commissioner being of opinion that there was no sufficient cause simply dismissed the appeal. Then the matter was taken to the Commissioner and the Commissioner took the same view that the pleader's negligence was no sufficient cause; but, being asked to refer certain questions of law to this High Court, he has referred two. We are not concerned with the questions which he has not referred.