Law: Income Tax Act, 1922

Section: 18A(1)

Law: Income Tax Act, 1961

Section: 209

Section 209 of the Income-tax Act, 1961 [Corresponding to section 18A(1) of the Indian Income-tax Act, 1922] - Advance-tax - Computation of - Assessment year 1943-44 - Whether, even if there is an inaccuracy of amount in notice of demand issued under section 18A(1) of 1922 Act, it would not invalidate notice and make it altogether void - Held, yes FACTS The levy of interest under section 18A(6) of 1922 Act was challenged by the petitioner on the grounds that initially the notice of demand for payment of advance income-tax under section 18A(1) of the 1922 Act was void in law because the demand in that notice was based on the last completed assessment of the assessee but in that demand his income from two firms of which he was a partner was taken to be the same as had been included in his last completed assessment and there was no substitution for that amount of the share of his income as calculated on the basis of subsequent completed assessments of those firms. HELD In the instant case, the first ground was based on non-compliance by the ITO with the provisions of the second proviso to section 18A(1)(a ) of 1922 Act and that proviso applies only to registered firms. There was no assertion by the petitioner in any affidavit that the two firms in question were registered firms. The second reason why this ground could not succeed was that there was nothing to show that the procedure adopted by the ITO in any way, acted to the prejudice of the petitioner. It could not be held that, in the notice of demand under section 18A(1)of 1922 Act, the figure was shown at an excessive amount and had not been reduced. Consequently, it could not be held that that notice of demand was incorrect. The third reason was that even if it be held that there was an inaccuracy in the notice of demand, it would not invalidate that notice and make it altogether void. If, according to the assessee, the demand was excessive, he could have certainly moved the officer issuing the notice of demand to correct the demand but the mere inaccuracy in the demand would not make the notice of demand entirely void and ineffective. In pursuance of that demand, the petitioner submitted his own estimate…

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