Law:

Section:

Section 148 of the Income-tax Act, 1961 - Income escaping assessment - Issue of notice for - Assessment year 1954-55 - Whether where during assessment proceedings of subsequent assessment year, ITO came to know that firms from which goods were allegedly purchased by assessee were bogus, it could be said that he had reason to believe that income chargeable had escaped assessment - Held, yes - Whether, therefore, notice issued by ITO under section 148 for assessment year in question was valid - Held, yes FACTS The ITO issued notice under section 148 stating that income chargeable to tax had escaped income within meaning of section 147. The assessee filed writ petition to quash the notice. In the counter affidavit the ITO stated that after the completion of the regular assessment for the year 1954-55 and in the course of the assessment proceedings for the subsequent years, information came into possession of the ITO upon enquiry that the purchases of disposal goods to the extent of Rs. 1,51,325 shown in the accounts of the assessee for the accounting year 1953-54 were bogus as the suppliers from whom the alleged purchases were shown to have been made were fictitious. Thereafter, further information came into the possession of the ITO upon enquiry on the basis of which it was found that the alleged loans amounting to Rs. 2 lakhs were bogus. Therefore, he had reason to believe that income chargeable to tax had escaped assessment. On writ: HELD From the grounds furnished by the department in initiation of proceedings, it was clear that it was a case which came under section 147(a) , viz., that according to the opinion of the officer, there is reason to believe that income had escaped assessment by reason of the failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment. From the reasoned disclosed, it was clear that the assessee showed in his accounts false and fictitious purchases and if this was assumed to be true, there was no lack of jurisdiction in the officer having reason to believe that income had escaped assessment by reason of the assessee not fully and truly disclosing all material necessary for his…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492