TMI Blog1977 (7) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... asis of the acknowledgment receipt which showed that the demand notice was duly served on the assessee. If the Tribunal had done so it would have reached the inevitable and inescapable conclusion that the demand notice had been duly and properly served. The Tribunal ought not to have misled itself by relying on the slip which contained a misleading note by an inspector that the correct name of the assessee was " Rash Behari Burman " and not " Rash Behari Das Burman ". The Tribunal ought to have taken note of the fact that the assessee had all throughout been assessed as " Rash Behari Das Burman " and the returns filed by the assessee himself would have made the position absolutely clear and free from any doubt. In my opinion, the Tribunal has misdirected itself by taking into consideration irrelevant evidence and by discarding material and legal evidence before it. The facts remained that the assessee filed the return for 1955-56 by showing his status as HUF. The assessment form annexed to the demand notice showed that the advance taxes were paid by the assessee in respect of such return. It must follow, therefore, that such advance taxes were paid on the basis of his status as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the status of HUF was not changed in respect of the said years. The two questions are, therefore, answered in the affirmative and it is ordered that there will be no order as to costs. HAZRA J.--On the application of the CIT, West Bengal-III, Calcutta, two questions of law arising out of the consolidated order of the Tribunal have been referred to this court by the Tribunal, Calcutta, Bench " B " under s. 256(1) of the I.T. Act, 1961. The questions are : "1. Whether, on the facts and in the circumstances of the case, there was a valid assessment on an HUF for the assessment year 1955-56 ? 2. If the answer to question No. 1 is in the affirmative then whether, on the facts and in the circumstances of the case, the assessments for 1958-59 to 1962-63 in the status of HUF are valid ? " These references relate to the assessment years 1958-59 to 1962-63. The relevant previous years are the corresponding B. S. years 1364 to 1368. The assessee was one Rash Behari Das Burman. The following genealogical table will indicate the family to which Rash Behari Das Burman belonged. RAJA DAMODAR DAS BURMAN - - - - --- - -- - - --- - - -- ---- -- - - - - - - - - - - - - - - --- - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the " demand notice " for 1955-56 are annexed hereto as annexures with the statement of the case. On the question whether there was an assessment on the family for the assessment year 1955-56, the conclusions of the Tribunal as stated in the statement of the case were : " (1) There was no signed assessment order. (2) Even if a demand notice is taken to exist in this case, the assessment is invalid as, in spite of there being a positive demand thereunder, it had not been served on the assessee." I think I shall quote here the relevant portion of the order of the Tribunal which has been annexed to the statement of the case. The relevant portion of the order of the Tribunal is as follows : " We may first consider the question as to whether there was actually an assessment on any HUF of Rash Behari Burman. It is not the case of the department that there was any such assessment except for 1955-56. For that year, when we looked into the records as pointed out earlier, we find that there is no assessment order or any assessment form which has been signed by the ITO. There is, however, a demand notice but it is not clear whether the said demand notice has been signed by Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f s. 23 of the Act. " 23. Assessment.--(1) If the Income-tax Officer is satisfied without requiring the presence of the assessee or the production by him of any evidence that a return made under section 22 is correct and complete he shall assess the total income of the assessee, and shall determine the sum payable by him on the basis of such return. (2) If the Income-tax Officer is not satisfied without requiring the pre sence of the person who made the return or the production of evidence that a return made under section 22 is correct and complete, he shall serve on such person a notice requiring him, on a date to be therein specified, either to attend at the Income-tax Officer's office or to produce, or to cause to be there produced, any evidence on which such person may rely in support of the return. (3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, the Income-tax Officer, after hearing such evidence as such person may produce and such other evidence as the Income-tax Officer may require, on specified points, shall, by an order in writing, assess the total income of the assessee, and determine the sum payable by him on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly desirable but necessary that an order of assessment should be communicated to the assessee. The Act itself envisages service of the assessment order. Sub-s. (3) of s. 31 for instance provides that an appeal from the order of assessment shall be presented within a period of thirty days from the date of service of the order. Apart from this, the assessee is entitled to know the reasoning for imposing tax or penalty on him and he would be able to exercise his right of appeal, if any, only if the order is communicated to him. But the question is not whether it is either desirable or necessary, that an order of assessment should be communicated, but whether the lack of communication of the order would make the order void or would have the result of keeping the assessment proceedings pending. " The learned judges further held : " Notwithstanding the fact that the order had not been communicated it is a valid order." Although in that decision the learned judges considered the Agrl. I.T. Act, I accept the principle of law laid down in that decision. In my view, the conclusion of the Tribunal on this point is neither right nor the same is according to law. I will now turn to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up a statement of the case are stated that " the acknowledgment is signed by one Phool Singh on April 25, 1958. Records show this Phool Singh to have received a number of notices on behalf of the assessee on widely separated dates. The order sheet for the assessment year 1955-56 shows that the assessment for the year was made on March 28 1958 ". But the Tribunal did not consider the above facts and did not make any reference to the same either in its order or in the statement of the case. The finding of the Tribunal that the demand notice was not served on the assessee is not based on legal evidence and seems to me to be perverse. The Tribunal itself was in doubt and that is why the Tribunal said that on the facts of the case the Tribunal would give the benefit of doubt to the assessee and held that it was not possible to take the demand notice as having been served on the assessee. In my view, there is no room for giving any benefit of doubt to the assessee by the Tribunal in such a case. The Tribunal is not interpreting a fiscal enactment which is open to doubt and construing the same as beneficial to the subject. It seems to me that the Tribunal has based its decision partly on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the relevant law could have come to such determination. In Edwards v. Bairstow [1955] 36 TC 207 at page 224 ; 28 ITR 579, the House of Lords laid down the same principles. In that case, Lord Simonds observed that even a pure finding of fact may be set aside by the court if it appears that the Commissioners have acted without any evidence or upon a view of the facts which could not reasonably be entertained." Mr. R. L. Sinha for the assessee has argued that since there is no assessment order or any assessment form which is signed by the ITO there is no assessment and this finding of the Tribunal is conclusive. According to Mr. Sinha on this finding we must hold that for the year 1955-56 the assessee was not assessed. It is difficult to accept this submission of Mr. Sinha as there is the existence of the notice of demand. This presupposes the existence of a valid assessment order. The question No. 1 is a question of law, viz., whether there was valid assessment on a HUF. The notice of demand clearly shows that the status of the assessee was the HUF. Mr.Sinha has cited two cases, viz., Badri Prosad Bajoria v. CIT [1967] 64 ITR 362 (Cal) and V.S. Sivalingam Chettiar v. CIT [1966 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
