TMI Blog1968 (5) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... iness into a partnership came into existence between Baidyanath Gorai, his mother-in-law, Srimati Gouribala Dasi, and his son-in-law, Nemaichand Saha. According to the deed, the three partners were given the following shares in the partnership : Baidyanath Gorai ... 40% Nemaichand Saha ... 30% Gouribala Dasi ... 30% The Income-tax Officer accorded registration to the firm, under section 26A, for the successive two assessment years under appeal. The Commissioner of Income-tax, West Bengal, Calcutta, however, found on examination of the records that the orders of the Income-tax Officer granting registration to the firm for the assessment year 1959-60 and the renewal of registration for the assessment year 1960-61 were erroneous and prejudicial to the interests of revenue. The Commissioner of Income-tax thereupon issued a notice to the assessee-firm to show cause why the registration granted by the Income-tax Officer should, not be cancelled. The material portion of the notice reads as follows : "On a perusal of the orders under section 26A passed by Income-tax Officer, 'A' Ward, Asansol, on 5th October, 1960, and 25th February, 1961, for the assessment years 1959-60 and 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , as the notice did not indicate the grounds on which the Commissioner of Income-tax intended to take action under section 33B ; (b) that it was incumbent upon the Commissioner to indicate in the notice the point or points upon which he would like to be satisfied before making an order under section 33B. In the absence of such particulars in the notice, it was not possible for the assessee to know what points he had to meet before the Commissioner ; (c) that the notice was defective and the Commissioner had no jurisdiction to pass the orders as he did. The Tribunal repelled the contentions with the following observations : " The notice dated the 18th July, 1962, issued by the Commissioner is on record. The Commissioner clearly states therein that he considers that the orders of the Income-tax Officer, A-Ward, Asansol, dated 5th October, 1960, and 25th February, 1961, for the assessment years 1959-60 and 1960-61, are erroneous and prejudicial to revenue, inasmuch as registration and renewal of registration should not have been granted 'as there are prima facie reasons and grounds to hold that the partnership brought into existence by the partnership deed dated 2nd January, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ission. As far back as in the year 1958, the Supreme Court laid down in the case of Khem Chand v. Union of India what should be the measure of opportunity to be given. The Supreme Court observed : " He must not only be given an opportunity but such opportunity must be a reasonable one ...... he should be informed about the charge or charges levelled against him and the evidence by which it is sought to be established ...... " The above observation was no doubt made in the context of a disciplinary proceeding. We are, however, of the opinion that the measure of opportunity is the same, be it a disciplinary proceeding or a taxation proceeding. The question that we need decide, in this reference, is whether the opportunity given by the Commissioner to the assessee, by the impugned notice, was a reasonable opportunity. All that was said in the notice was that " there were prima facie reasons and grounds to hold that the partnership brought into existence by the partnership deed dated January 2, 1958, was not a genuine one ". On reading the notice one might wonder what was the particular reason which induced the Commissioner to think that the deed was not a genuine one. Was it becau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot one on receipt of which an assessee may be left to speculate. In the instant case, the language used in the notice was not sufficiently revealing to the assessee as to which particular case he was called upon to meet. In a decision of this court in Bagsu Devi Bafna v. Commissioner of Income-tax, this court observed : " That in a notice, under section 33B of the Indian Income-tax Act, the Commissioner must disclose to the assessee the grounds on which he proposed to revise, to enable the assessee to show cause." This judgment has since been upheld by the appellate court in 63 I.T.R. 333. Thus the authorities are unanimous that there must be sufficient disclosure made by the Commissioner, when he issues a notice upon the assessee for starting proceedings under section 33B. In our opinion, the notice must be such as would not leave the assessee in doubt and speculating as to the nature of the charge he has to meet. Our attention was drawn, on behalf of the revenue, to a recent Supreme Court decision in Rampyari Devi Saraogi v. Commissioner of Income-tax, and on the authority of that decision it was contended that there was no denial of natural justice in the instant case, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee, in our view, has not in any way suffered from the failure of the Commissioner to indicate the results of the enquiries, mentioned above. Moreover, the assessee will have full opportunity of showing to the Income-tax Officer whether he had jurisdiction or not and whether the income assessed in the assessment orders which were originally passed was correct or not. " The above judgment of the Supreme Court is vastly distinguishable. We have quoted the language of the notice, issued by the Commissioner, in Rampyari Devi's case. That notice indicated to the assessee the basic materials on which the Commissioner intended to take action against the assessee under section 33B. If the basic materials were all there but the supporting materials were missing, that should not prove fatal to the notice. Then again, the Supreme Court was weighed by the consideration that the assessee would have full opportunity of showing to the Income-tax Officer whether he had jurisdiction or not and whether income assessed in the assessment orders were correct or not. In the instant case, the notice is not as revealing as the notice in Rampyari Devi Saraogi's case. We have already indicated that on re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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