Law: Income Tax Rules, 1922

Section:

S. 34----Notice drafted four days before end of assessment year but served two weeks after its expiry-Not bad.   (b) Income-tax Act (XI of 1922),   S. 63 (1)----Service of notice under section 34 on employee of assessee-Fact that notice in some way or other reached person authorised to receive it not sufficient to bind assessee-Conduct of assessee in appearing in response to notice not considered as estoppel, in absence of any such stand of depart ment.   An employee of the assessee who was also found assisting the assessee's authorised representative in appeal before the Appellate Tribunal was served with a notice under section 34. In response to the said notice and further requisitions, the assessee's counsel hold ing power-of-attorney executed in his favour by one of the partners of assessee firm, made several appearances before the Income-tax Officer and, a return was also filed by the assessee. The Appellate Tribunal, holding that the assessee was aware of the proceedings and the service of the notice, in the manners stated above dis missed the appeal of the assessee.   Held, that it was clear from the order of the Appellate Tribunal that the representative of the Income-tax department was not thinking of estoppel and, there was nothing in the order of the Appellate Tribunal to show that the conduct of the assessee and resultant estoppel was considered. By excluding from consideration the conduct of the assessee after receipt of notice under section 34 by his employee and its consequences, the answer to the question as to whether the service of notice was effective to bind the assessee, had to be that it was bad and the fact that the notice in some way or other reached the person authorised to receive it was not sufficient to bind the assessee firm. Hence the service on employee of assessee was ineffective and not binding on him.   Muhammad Idrees Barry & Co. Lahore v. Commissioner of Income-tax, Punjab and N. W. F. P., Lahore P L D 1957 Lah. 270: 1960 P T D 240 rel.   Muhammad Idrees Barry & Co. v. C. I. T. P L D 1959 S C (Pak.) 202: 1959 P T D 478 fol   Date of hearing: 5th October, 1960. JUDGMENT  …