Law: Income Tax Act, 1922

Section: 34,34(2),31,23(2),23(3)

Income-tax Act (XI of 1922), S. 34 (2) proviso read with S. 31 and Ss. 23 (2) & 23 (3)-Plea that `sufficient time' was not allowed to comply with notices under Ss. 23 (2) & 23 (3) and that issuance of such notices simultaneously was bad-Ground in plea, held, not sufficient to declare assessment as one made without jurisdiction, illegal, void ab initio or a nullity in law--­Appellate Assistant Commissioner competent to set aside assess­ment and make an order for fresh assessment-Proviso to S. 34 (2) applicable - Held, also that Ss. 23 (2) & 23 (3) contemplate only one notice and not two. An assessment is not vitiated if notices under sections 23 (2) and 23 (3) are simultaneously issued. An assessment com­pleted within statutory period cannot be held illegal, void, ab initio, or without jurisdiction, or liable to be annulled on the point of sufficiency of time allowed to the assessee. [In the circumstances of this' case time allowed was held to be sufficient : 29-31 March 1954.] The Appellate Assistant Commissioner is, however, competent to set aside such assessment, and direct the Income-tax Officer to make a fresh assessment, if he finds that it was completed without sufficient time being allowed to the assessee to comply with notices under sections 23 (2) and ~3 (3), and proviso to section 34 (2) would apply. Sections 23 (2) and 23 (3), however, contemplate only "one" notice i.e., under section 23 (2) and not under S. 23 (3). Commissioner of Income-tax, Punjab v. Nawab Shah Nawaz Khan (1938) 6 I T R 370 and Nawal Kishore Khamliti v. Commis­sioner of Income-tax, Punjab (1936) 4 I T R 287 distinguished. JUDGMENT M. YAQUB ALI, J.-The Income-tax Appellate Tribunal has, at the instance of the Commissioner of Income-tax, North Zone, West Pakistan, Lahore, referred the following question to this Court for its opinion under section 66 (1) of the Income-tax Act (hereinafter referred to as the Act): - "Whether, in the facts and circumstances of the case, the Tribunal was right in holding that the assessment was liable to be annulled and not merely set aside ?" 2. The facts necessary to be stated for the purpose of this order are that the assessee, the Messrs…

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