A.K.Sengupta, J. - (1.) In this application, the petitioner has challenged three several notices issued under Section 148 of the Income-tax Act, 1961. Two of the notices are dated March 20, 1975, relating to the assessment years 1966-67 and 1967-68. The other notice dated February 20, 1978, is for the assessment year 1969-70. The ground of challenge is that the Income-tax Officer has no jurisdiction to initiate any proceeding under Section 147(a) of the Income- tax Act, 1961, as the conditions precedent have not been satisfied.
(2.) The reasons which have been recorded are identical for all the years which are to the following effect I "The assessee constructed a H.P. at 48-D, Muktaram Babu Street, Calcutta-7, during the accounting years 1964 to 1967 corresponding to the assessment years 1965-66 to 1968-69. The case was referred to the Executive Engineer (Valuation), Unit-II, Calcutta, and report of valuation since received. The total cost of construction up to the assessment year 1969-70 has been shown by the assessee at Rs. 4,20,000 including lift whereas the estimated value as per valuer is Rs. 5,06,900 including lift. There appears to have been no construction during the calendar year 1968. Thus, there is a difference of Rs. 86,864 (Rs. 5,06,864--4,20,000), being the estimated difference. Considering that the assessee had invested equally during 1964 to 1967, i.e., for 4 years in the H.P., the assessee's income to the tune of Rs. 21,716 (Rs. 86,864) has escaped assessment each year. I have, therefore, reason to believe that the assessee's income of Rs. 21,700 escaped assessment for the assessment year 1966-67, due to the failure on the part of the assessee to disclose truly and fully all material facts necessary for her assessment for that year. Tax effect Rs. 9,237."
(3.) In the affidavit-in-opposition, the respondents, in paragraph 3, have stated as follows : "(a) The original assessment for the assessment years 1965-66, 1966-67, 1967-68, 1968-69 and 1969-70, were completed on September 28, 1969, January 16, 1971, March 25, 1972, March 25, 1972, and March 25, 1972, respectively, (b) On scrutiny of the Order Sheet dated August 5, 1969, for 1965-66, it appears that predecessor-in-interest in office has stated : 'Re. expenses incurred in the construction of Agarwal Bhavan during the year, she is to give detailed particulars.' It also appears on the Order Sheet dated August 12, 1969, that the other particulars have been filed. (c) From the records of the the case, it appears that no details of construction cost are available on record and nothing has been mentioned about the same for the assessment year 1965-66 and no details as to the cost of construction are on record. (d) During the course of assessment proceedings for the year 1967-68, summons under Section 131 of the Income-tax Act, 1961, was issued on February 21, 1972, and the assessee filed the valuation report and sanction plan of the house property on February 25, 1972. The assessee filed the original, valuation report made by M/s. R.N. Seal and Associates, 5, Russel Street, Calcutta, showing valuation of the house property at Rs. 6,34,646 including the value of the land and old structures. (e) Being not satisfied with the valuation report, the predecessor-in-interest in office sent an Inspector attached to the Officer, who was entrusted with the valuation of the property and the Inspector furnished the report on March 16, 1972, showing the valuation at Rs. 7,86,058. As there was difference in valuation, the predecessor-in-interest in office referred the matter finally to the Exective Engineer, Valuation Unit-I, on March 17, 1972. (f) As the preparation of the report of the valuation was a time-consuming factor and will take some time, the Executive Engineer requested the predecessor-in-interest in office to complete the time-barring assessments for the years 1967-68, 1968-69 and 1969-70 without waitingfor the valuation report as the preparation of the valuation report was not possible without inspection and full particulars. On receipt of the aforesaid request, the assessments for the assessment years J967-68, 1968-69 and 1969-70, were completed on March 25, 1972, on the basis of the valuation report made by Messrs. R.N. Seal & Associates submitted by the assessee. (g) The Exective Engineer thereafter sent a valuation report on September 23, 1972, showing the valuation at Rs 6,73,000 as on December 31, 1968, and Rs. 7,69,000 as on December 31, 1970. (h) On the basis of the aforesaid, the Income-tax Officer on careful consideration of the entire issue has reasons to believe that the assessee's income chargeable to tax has escaped assessment due to failure on the part of the assessee to disclose truly and fully all the material facts necessary for the assessment for those years and accordingly proceedings under Section 148(2) of the Income-tax Act wero initiated for the assessment years 1965-66 to 1969-70. A copy oi the reasons recorded for initiation of the proceeding is annexed herewith and marked with the letter 'X' collectively.";