Law: Income Tax Act, 1961

Section: 147,147(a),148

Income-tax-----Reassessment---Writ---Notice---Failure to disclose material facts necessary for assessment---Notice on ground that there had been under­assessment of capital gains because assessed had given a lower value of land on 1-1-1964, than one shown to Wealth Tax Authorities and had also not disclosed that he was being assessed to wealth tax--Prima facie case made out for assessment---Question whether there was a failure to disclose material facts necessary for assessment could be decided by assessing and Appellate Authorities---Writ would not issue to quash notice---Indian Income Tax Act, 1961, S.147(a)---Constitution of India, Art.226. A notice of reassessment was issued in respect of the assessment year 198.1-82 under section 147(a) of the Income Tax Act, 1961. The suppression or failure to disclose the material facts had arisen, according to the Department, on account of the fact that the petitioner claimed a fair market value as on January 1, 1964, of the land which was sold during the assessment year 1981-82 at much less than what was shown in the wealth tax return for the year 1978-79. It was also the case of the Department that in the returns filed, the petitioner failed to disclose that he was subjected to wealth tax in respect of the same item of property. On a writ petition to quash the notice: Held, dismissing the writ petition, that there was a prima facie case to proceed under. section 147. The question whether or not in the circumstances of the case, the omission to divulge the previous year's wealth tax assessment and the valuation that he gave in the previous proceedings amounted to non-disclosure of material facts within the meaning of section 147(a) of the Act was a matter to be more appropriately decided by the assessing and appellate authority under the Act. These were not fit cases to exercise jurisdiction under Article 226 of the Constitution of India to stop the proceedings under sections 147 and 148 of the Act at the threshold. The notice could not be quashed. CIT v. Jeskaran Bhuvalka (1970) 76 ITR 128 (AP) and Gemini Leather Stores v. ITO (1975) 100 ITR 1 (SC) ref. JUDGMENT P. VENKATARAMA REDDI, J.---The petitioner seeks a writ…

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