TMI Blog1973 (2) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 66(1) of the Indian Income-tax Act, 1922 (to be hereinafter referred to as " the Act "). The assessee is a Hindu undivided family. In this case we are concerned with the assessee's assessment for the assessment year 1950-51. The question for decision in this case is whether on the facts and circumstances of the case the proceedings which were commenced by a notice under section 34(1)(b) could have been converted into a proceeding under section 34(1)(a) by the Income-tax Appellate Tribunal. In order to decide this question it is necessary to refer to the material facts. For the assessment year in question the assessee was assessed without any objection. Thereafter, the Income-tax Officer issued a notice to it under section 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that order on an alternative ground, namely, that the impugned proceedings could be justified under section 34(1)(a). Thereafter, at the instance of the assessee, the Tribunal submitted the following questions soliciting the opinion of the High Court : " (1) Whether the reopening of the case by the Income-tax Officer by the issue of a notice under section 34 of the Indian Income-tax Act fell within the ambit of section 34(1)(a) of the Act or under section 34(1)(b) of the Act ? (2) Whether the service of the notice under section 34 of the Indian Income-tax Act by affixture on the residential house of the assessee was legal and proper ? (3) Whether the amount of Rs. 62,500 was liable to tax under section 4(1)(b)(iii) of the Indian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndition precedent. Without formation of such an opinion he will not have jurisdiction to initiate proceedings under section 34(1)(a). The fulfilment of this condition is not a mere formality but it is mandatory. The failure to fulfil that condition would vitiate the entire proceedings. As held by this court in Sheo Nath Singh v. Appellate Assistant Commissioner of Income-tax, the Income-tax Officer would be acting without jurisdiction if the reason for his belief that the conditions are satisfied, does not exist or is not material or relevant to the belief required by this section. It is true that the courts will not go into the sufficiency of the reasons which persuaded the Income-tax Officer to initiate proceedings under section 34(1)(a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 34(1)(a). The Tribunal could not have initiated proceedings under section 34(1)(a). If the Tribunal converts the proceedings into one under section 34(1)(a) then the conditions prescribed in section 34(1)(a) cannot be satisfied. We are of the opinion that the Tribunal erred in upholding the impugned proceedings under section 34(1)(a). The High Court also did not address itself to this question properly. For the reasons mentioned above this appeal is allowed. The answers given by the High Court on questions Nos. 1 and 3 are discharged and in their place we answer question No. 1, that the proceedings, taken were invalid. Consequently, we answer the third question in the negative and in favour of the assessee. The revenue to pay t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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