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1968 (8) TMI 21 - SC - Income TaxWhether a notice had been served under section 19(2) of the Act on the respondents and therefore the reasoning of the High Court was based on an erroneous assumption that no such notice had been served? Held that:- It was held that the voluntary return filed by the assessee, even though it did not disclose any taxable income, was a good return. As such, no question arose under section 34(1) of income escaping assessment and the Income-tax Officer was not justified in issuing a notice under section 34(1). The assessment which was therefore made pursuant to the notice under that section was barred by time, having been made beyond the period prescribed. The principle which has been settled by this decision is that where a voluntary return has been filed pursuant to a general notice even after the expiry of the period mentioned in that notice, the Income-tax Officer must proceed to assess the income by taking up that return. He cannot ignore that return and serve on the assessee a notice under the provisions relating to escaped income which was section 34 in the Income-tax Act. Appeal allowed.
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