TMI Blog1982 (4) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee to produce certain records. The brief facts are these : The petitioner-society was established on July 5, 1940, and was duly registered with the Registrar of Societies and Firms, Lucknow, the certificate having been granted on 20th July, 1940. The aims and objects for which the society was established, inter alia, were to promote commerce, art and science; to establish and maintain or to give aid to institution or institutions for giving training in commerce, trades, industries, etc., and for imparting moral and physical education to the children of all castes and creeds; to establish and maintain or to give aid to dharamshala, widow home or any other such charitable institution; to establish and maintain any dispensary or hosp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so under the relevant provisions of the 1961 Act. Thus the assessee was under no obligation to file any return of its income under s. 22(1)/s. 139(1). With effect from April 1, 1971, sub-s. (4A) was inserted in s. 139 of the 1961 Act. This provision reads as under : " Every person in respect of income derived from property held under trust or other legal obligation wholly for charitable or religious purposes, or in part only for such purposes, or of income being voluntary contributions referred to in sub-clause (ii-a) of clause (24) of section 2, shall, if the total income in respect of which he is assessable as a representative assessee (the total income for this purpose being computed under this Act without giving effect to the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 1974-75, the assessment was made by the ITO, Central Circle V, New Delhi, on July 21, 1977, and the net income was determined at Rs. 1,39,829. During the pendency of the proceedings for this year, this ITO issued a notice under s. 148 of the 1961 Act to the assessee after obtaining prior approval from the CBDT, on March 25, 1977, for reopening the assessment for 1960-61. This notice was served on the assessee on March 30, 1977. The assessee requested the ITO by its letter dated May 25, 1977, to supply the reasons. The society made another similar request on September 17, 1977, and on November 19, 1977, and then filed a return for the assessment year under consideration under protest declaring its taxable income at nil. The ITO then issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e remedy provided under the Act. As far as the other preliminary objection, a part of the cause of action did arise within the jurisdiction of this court. The petitioner society is situated within the territorial jurisdiction of this court. The notice was served on the petitioner-society at this place. It has been called upon to produced books and documents in support of its return. Thus, it cannot be said that no part of cause of action has arisen within the territorial jurisdiction of this court. The case in Purtabpore Co. Ltd. v. Cane Commissioner, Bihar, AIR 1969 All 105, on which reliance was placed by Sri Katju, was on different facts. In that case the Cane Commissioner, Bihar at Patna, passed two orders on November 14, 1967. By his f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner. In the present case no such situation obtains. Effective relief can be granted to the petitioner in these proceedings by this court. Coming to the merits of the case, the undisputed facts are that the society was granted a certificate of exemption under s. 4(3) of the 1922 Act by the ITO, A Ward, Meerut, on February 17, 1958. Thus, it was under no obligation to file a voluntary return under s. 22(1) of that Act or s. 139(1) of the 1961 Act when the latter Act came into force. After the insertion of sub-s. (4A) in s. 139 of this Act from April 1, 1971, the assessee was under a statutory obligation to file a voluntary return of its income. In compliance with that provision the assessee did file voluntary return for the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ission or failure to file the return. The same is the case with regard to the other condition because the assessee had been granted a certificate of exemption. Thus, there could be no omission or failure on the part of the assessee to disclose fully and truly all, material facts necessary for its assessment for this year. Now, coming to cl. (b) of this section, the ITO should have, in consequence of information in his possession, reason to believe that income has escaped assessment. This clause also would not be applicable because for the assessment years 1973-74 and 1974-75, the assessments made by the ITO were quashed by the AAC and the same view was taken on further appeal by the Tribunal. The view taken by the Tribunal was based on a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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