K.L.Roy, J. - (1.) This is one more application under Article 226 of the Constitution for a writ in the nature of certiorari for quashing a notice under Section 148 of the Income-tax Act, 1961, served on the petitioner and all proceedings taken thereunder and also for a writ in the nature of prohibition restraining the respondents from taking any further steps in respect of the impugned notice and for other ancillary reliefs. The petitioner is Srimati Suniti Devi Jaipuria and the respondents are, (1) the Income-tax Officer, Central Circle XI, (2) the Income-tax Officer, Refund Circle, Calcutta, (3) the Income-tax Officer, " C " Ward, District II{2), Calcutta, (4) the Income-tax Officer, " B " Ward, District VI, Calcutta, (5) the Commissioner of Income-tax, Central, Calcutta, (6) the Commissioner of Income-tax, West Bengal-I and (7) the Union of India. As the facts narrated and/or alleged in the petition as also the replies therefor in the affidavits-in-opposition would be material for the purpose of considering one of the contentions raised by learned counsel for the department, it would be necessary to set out the facts in some detail. The petitioner had income from dividends and in respect of the assessment year prior to the year 1956-57, the petitioner used to file her returns with the Income-tax Officer, Refund Circle, Calcutta, in order to claim refund of excess tax deducted at source and her general index register number in that circle was No. RC/ II(I)/235-J. For the assessment year 1956-57, for which the corresponding accounting year was 2013 S.Y., the petitioner filed her return before the said Income-tax Officer, Refund Circle, the second respondent herein, on the 29th March, 1561, i.e., only two days before the time to file a return expire^. Apparently, no order was passed on this return by the second respondent. A notice purported to be under Section 148 of the Income-tax Act, 1961, dated the 6th June, 1963, requiring the petitioner to submit her return for the assessment year 1956-57, as the Income-tax Officer was of the opinion that her income for that year had escaped assessment, was served on the petitioner by the third respondent, the Income-tax Officer, " C " Ward, District 11(2), Calcutta, the income-tax file of the petitioner having been transferred to the said officer some time in July, 1961, without any intimation to the petitioner. By her advocate's letter dated the 6th July, 1961, the petitioner challenged the validity and/or legality of the said notice. Thereafter, some time in the year 1964, the petitioner's income-tax file was again transferred to the Income-tax Officer, " B " Ward, District VI, Calcutta, being respondent No. 4 herein, but again no intimation of such transfer was given to the petitioner. The petitioner through her advocate demanded of the said respondent No. 4 to supply her with materials or reasons which had led the Income-tax Officer to believe that her income had escaped assessment. On or about the 28th August, 1964, the said respondent No. 4 refused to disclose or communicate the alleged reasons as amended. Thereafter, some time in the year 1966, the petitioner's assessment file was transferred back to the Income-tax Officer, Central Circle XI, the respondent No. I again without any intimation of such change to the petitioner. Having been aware of the last transfer the petitioner through her advocate's letter dated the 20/27th September, 1966, again challenged the jurisdiction of the said respondent No. 1 to initiate the assessment proceedings under Section 148 and pointed out that the return already filed by the assessee might be treated as her return in compliance with the aforesaid notice. It was also recorded that the aforesaid submission was under protest and without prejudice to the petitioner's contentions. Thereafter, the respondent No. 1 issued the usual notice under Section 142(1) of the Act on the '16th May, 1967, which was duly complied with by the petitioner through her advocate on the 24th May, 1967, under protest and without prejudice. On the last mentioned date the respondent No. 1 required the petitioner to submit a fresh return of income and by his letter dated the 5th August, 1967, the said respondent No. 1 informed the petitioner that as her return for the assessment year 1956-57 had not been filed, penal action would be taken against her. This application was made on the 5th September, 1967, and a rule nisi was obtained on that date.
(2.) In the affidavit-in-opposition affirmed by Patri Seshadri Rao, the respondent No. 1 in this application, none of the allegations made in the petition are denied. It is contended that as the Income-tax Officer, Refund' Circle, has jurisdiction only over cases which result in refund, the return filed by the petitioner for the assessment year 1956-57 before that officer was invalid as in that year the petitioner was liable to be assessed on a substantial income. The officer having jurisdiction over the petitioner was the Income-tax Officer, District 11(2), within whose territorial jurisdiction the petitioner resided at the material time and a return should have been filed before that officer. It is submitted that as no valid return had been filed for 1956-57, the respondent No. 1 had rightly issued the impugned notice under Section 148. So far as the intermittent transfers of the petitioner's file from one Income-tax Officer to another is concerned the only comment made in the affidavit is that where the file is transferred from one Income-tax Officer to another situated in the same city it is not necessary to give any notice to the assessee and it is further submitted that when the petitioner demanded to be informed of the reasons for the Income-tax Officer's belief that income had escaped assessment, she was not entitled to such information at that stage. That an original return was received in respect of the assessment year 1956-57 is substantiated by the entry in the order sheet included in paragraph 11 of the said affidavit. The contention of the respondent is that no valid return having been filed for the assessment year 1956-57, there was no bar to the respondent No, 1 issuing a notice under Section 148 of the Act for reassessment of the petitioner's income for that year.
(3.) Dr. Pal, the learned counsel for the petitioner, submitted that as the income-tax file along with the general index number of the petitioner was with the Income-tax Officer, Refund Circle, the petitioner could only file her return before that officer. Until the file was transferred to respondent No. 1 in July, 1961, the petitioner could not have filed her return before that officer and in this case the petitioner had already filed the return on the 29th March, 1961. It cannot, therefore, be argued that no valid return was filed by the petitioner for that year. Dr. Pal referred me to the two well-known decisions of the Supreme Court, viz., Commissioner of Income-tax v. Ranchhoddas Karsondas, and Commissioner of Income-tax v. S. Raman Chettiar, for the proposition that, if a return has been filed for any particular year, the Income-tax Officer is not justified in making a reassessment for that year by ignoring the return filed. In the first case the Supreme Court observed that a return in answer to the, general notice under Section 22(1) of the Income-tax Act, 1922, could, under Section 22(2) thereof, be filed at any time before assessment and for this there was no time limit. Further, where in respect of any year a return has been voluntarily submitted before assessment the Income-tax Officer could not choose to ignore the return and any notice of reassessment and consequent assessment under Section 34 ignoring the return was invalid. It is also submitted that, though in the present case the notice has been issued under Section 148 of the 1961 Act, as the assessment year is 1956-57, the provisions applicable would be the provisions of the repealed Act of 1922. In the first of the above cases the Supreme Court's attention was drawn by the learned counsel for the department to the impossibility of the department dealing with any return filed immediately before the limitation for the assessment for that year expired. It was in fact contended that if such a return was filed on the last date the department would be driven to complete the assessment proceedings within a few hours or lose the right to send a notice under Section 34(1). The Supreme Court observed that an argument ab inconvenienti was not a decisive argument. The Income-tax Officer could have avoided the result by issuing a notice under Section 23(2) and not remaining inactive until the period was about to expire. Further, all laws of limitation lead to some inconvenience and hard cases. In the second decision the court more, or less reiterated what had been said in Ranchhoddas's case. Dr. Pal accordingly submitted that the action of the respondent No. 1 in issuing a notice under Section 148 for the assessment year 1956-57, ignoring the return that the petitioner had already filed for that year, was without jurisdiction and void.;