Law:

Section:

Section 148 of Income-tax Act, 1961 - Income escaping assessment - Issue of notice for - Assessment years 1946-47 to 1950-51 - While making assessment for assessment year 1951-52, ITO found very large amounts deposited in various bank accounts of assessee and/or received by transfer from Pakistan which could not be co-ordinated with previous disclosed or assessed income of assessee - Accordingly, notices under section 148 were issued to assessee - Whether since there was deposits amounting to over Rs. 17 lakh in a year and no explanation was given by assessee in that regard, ITO was justified in assuming that said amount represented accumulated concealed profits of earlier years and issuing notices under section 148 for assessment years 1946-47 to 1950-51 - Held, yes FACTS The original assessments for the assessment years 1946-47 to 1950-51 had been completed under section 34/23 of the 1922 Act. Thereafter, the assessee filed a petition of disclosure and a settlement in writing was arrived at between the assessee and the Commissioner, wherein, inter alia, the assessee agreed to the determination of his total undisclosed income including the undisclosed income of his wife at Rs. 6,87,527. Out of this Rs. 2,00,000 was agreed to be spread over a period of six years, from the assessment year 1939-40 to the year 1944-45 and the balance of Rs. 4,87,025, to be distributed equally over a period of five years from 1945-46 to 1949-50. In accordance with the aforesaid agreement, reassessments for the years 1945-46 to 1949-50 were made under section 34 of the 1922 Act. While making assessment for the year 1951-52, the ITO noticed certain deposits and receipts and required the assessee to explain the same. In the meantime, five separate notices purported to be under section 148 in respect of the assessment years 1946-47 to 1950-51, were served on the assessee, requiring him to file his returns for these years as his income had escaped assessment. The assessee filed applications under article 226 of the Constitution, challenging the validity of the reassessment proceedings. HELD It could not be said that under section 147(a ) the assessment for several years could not be…

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