Law:

Section:

Section 148 of the Income-tax Act, 1961 - Income escaping assessment - Issue of notice for - Assessment years 1965-66 to 1972-73 - Whether where notice under section 148 was not issued to assessee-HUF, but was issued to Karta in his individual capacity, entire reassessment proceedings were illegal and without jurisdiction - Held, yes FACTS After completion of the assessment of the assessee-HUF for the assess ment years 1965-66 to 1972-73, the business premises of the assessee were searched. The ITO, on the basis of the documents and the articles found during the course of search, was of the view that the income of the assessee had escaped assessment. Accordingly, the notices under section 148 were addressed and served on the karta of the assessee. In compliance to the notice, returns were filed in the status of an HUF and the assessments were also completed in that status. The ITO rejected the contentions of the assessee that the department had no material to show that the income of the assessee had escaped assessment and that the notices were invalid and illegal as the same had been served in the individual capacity of the karta. On appeal, the Commissioner (Appeals) having accepted both the contentions of the assessee cancelled the reassessment orders. On further appeal, the Tribunal held that the notices were issued to the karta in his individual capacity who was required to file return in his individual capacity and not as the karta of the assessee and, therefore, notices issued were invalid and the reassessments were unsustainable in absence of proper notice. On reference : HELD It is fairly settled that a notice for reassessment of escaped income under section 148 is jurisdictional notice. The Assessing Officer gets jurisdiction to reassess the escaped income only after issuance and service of a valid notice under section 148. [Para 7] In the instant case, the Tribunal, on facts, had found that notice was issued to the karta in his individual capacity and the income sought to be reassessed was that of the assessee-HUF of which he was a karta. Therefore, the notice to reassess the income of the assessee-HUF was invalid. Consequently, the ITO had no…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492