Law: Income Tax Act, 1922

Section: 34,22(2)

Income-tax Act, 1922 -Sections 22(2), 34, 34(1) -- Notice -Return filed in response to notice under Sec. 22(2) -No assessment made on the basis of the return filed -Fresh notice under Sec. 34 issued -Whether valid in law -Held no -- Return filed in pursuance of notice under section 22(2) remaining undisposed -Issuance of notice under section 34 incompetent in circumstances -Assessment proceedings taken on such notice -Held, nullity in law -- Corresponding Sections: Income-tax Ordinance, 1979 -Sections 56, 65(1) -- ORDER {The order was passed by NUR ILAHI President}.--These are two direct appeals by the assessee, one against the assessment proper, and the other against the order refusing renewal of registration to the assessee firm. The year of assessment involved in both is 1956-57. 1. The assessee is a cotton ginner and pressser. Apart from other objections to the assessment as framed it is attacked, at the very outset, on the ground that it was not a case of assessment to be made on a notice under section 34 of the Income-tax Act. 2. What happened was that a notice under Section 22(2) of the Act was issued in the name of the assessee firm and served on 26th April 1956 on M a partner in the firm which consisted of 11 persons. In response to this notice a return was filed by T, an another partner. However, on 28th May 1960 a notice under Section 34 was issued in the name of the firm and served on one A, a person not connected with the firm, and thereafter further necessary notices were issued and served on partners. On those admitted facts the assessee contends that the proceedings, initiated on the basis of the aforesaid notice under Section 22(2) in response to which return had also been filed, still pending, no notice under Section 34 of the Act could lawfuly be issued, and the assessment framed as a result of that incompetent notice was illegal and void. 3. When return was filed in response to a notice under Section 22(2) and was pending disposal before the assessing officer obviously there was no occasion for the issuance of a notice under Section 34, which notice can issue only if no return is filed, or when an assessment is made on a return filed and it…

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