H.N. Seth, J. - (1.) BRIEFLY stated, the facts giving rise to these three petitions, seeking relief under Article 226 of the Constitution, are that in the City of Agra, there is a firm which carries on business in the name and style of M/s. Ganeshi Lal and Sons, During the year relevant to the assessment year 1967-68, the firm had ten partners who used to be, in respect of their share income from the firm, assessed to income-tax as individuals. It is claimed that during the year relevant to the assessment year 1968-69, some partners of the firm retired as a result of which the firm stood dissolved and a new firm consisting of the remaining partners came into existence and this new firm continued to carry on the business in the same name. Subsequently, there were other variations in the firm and the firm, as it stands today, is constituted of eight partners. Some of those partners are, in respect of the share income derived by them from the firm, being assessed as individuals, the remaining partners are, in respect of such share income, being assessed as members of their HUF.
(2.) IN due course, the firm was assessed to income-tax for the assessment year 1966-67, and for the same year, its partner, namely, Shri Sheo Mohan Lal, representing his HUF, was assessed to tax under the provisions of the W.T. Act. On 28th October, 1976, the main business premises of the firm, as also its show-rooms at Hotels Clerk, Shiraz and Holiday-Inn and the residential premises of its partners were searched by the I.T. authorities. As a result of the search, the I.T. authorities are said to have seized considerable amount of jewellary, etc., as also certain books of the firm. On 31st March, 1976, the ITO issued notices under Section 148 of the I.T. Act to the firm, M/s. Ganeshi Lal and Sons, for reopening the firm's assessment for the year 1967-68, and requiring it to file a revised return of the income. Likewise, on the same day, the WTO issued notices under Section 17 of the W.T. Act to Sri Sheo Mohan Lal (HUF) and Shri Brij Mohan Lal for making fresh assessment of their wealth for the year 1967-68 which according to the WTO had escaped assessment.
(3.) THE three petitioners then filed objections before the ITO and the WTO. THEy claimed that the proceedings initiated against them were illegal and, as such, they should be dropped. However, as the ITO and the WTO did not agree to drop these proceedings and they intended to continue the same, the petitioners approached this court for obtaining necessary relief under Article 226 of the Constitution. Whereas the petitioner in Writ Petition No. 340 of 1976 is the firm, M/s. Ganeshi Lal and Sons, the petitioners in Writ Petitions Nos. 347 and 348 of 1976 are Sri Sheo Mohan Lal and Sri Brij Mohan Lal. All the three petitioners contend that the proceedings for reopening their assessments under the provisions of the I.T. Act and the W.T. Act are barred by time and that they have been initiated without serving a proper notice upon them. They further claimed that there was no material on the basis of which either the ITO or the WTO could reasonably believe either that the income or the wealth of the petitioners had, for the assessment year 1967-68, escaped assessment. The proceedings initiated by the ITO/WTO are, therefore, without jurisdiction and are liable to be quashed.;