A. THOMAS AND CO. LTD. Vs. COMMISSIONER OF INCOME TAX, KERALA
HIGH COURT OF KERALA
A. Thomas And Co. Ltd.
COMMISSIONER OF INCOME TAX, KERALA
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M.S. Menon, J. -
(1.) THIS is a reference under section 66(1) of the Indian Income Tax Act, 1922. The question referred is:
Whether, on the facts and in the circumstances of the case, the Income Tax Officer had jurisdiction to take proceedings under section 34 and make reassessments for 1954 -55 and 1956 -57 and whether the reassessments made by the Income Tax Officer are valid ?
(2.) THE accounting period for 1954 -55 is the calendar year 1953, and the accounting period for 1956 -57 is the calendar year 1955. The original order of the assessment for 1954 -55 is dated December 31, 1954, and the original order for 1956 -57 is dated June 26, 1957.
(3.) THE Income Tax Officer treated the assessee as a dealer in shares. So did the Appellate Assistant Commissioner in the appeal filed by the assessee. The Assessee then took up the matter before the Income Tax Appellate Tribunal, and the Tribunal confirmed the decision that the assessee should be assessed in respect of his transaction in shares as a dealer therein. It also said that the income of the assessee in respect of both the assessment years has been under -assessed, but did not direct any reassessment as there was no appeal by the department.
The Income Tax Officer then took up the matter under section 34(1)(b) of the Indian Income Tax Act, 1922, which says that if the Income Tax Officer "has in consequence of information in his possession reason to believe that income, profits or gains chargeable to Income Tax have escaped assessment for any year, or have been under assessed, or assesseed at too low a rate, or have been made the subject of excessive relief under this Act, or that excessive loss or depreciation allowance has been computed" he may at any time within four years of the end of that year, "serve on the assessee" or, if the assessee is a company, on the principal officer thereof "a notice containing all or any of the requirements which may be included in a notice under sub -section(2) of section 22 and may proceed to assessee or reassess such income, profits or gains or recompute the loss or depreciation allowance; and the provisions of this Act shall, so far as many be, apply accordingly as if the notice were a notice issued under that sub -section".;
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