Prakash Krishna, J.:— The Income-tax Appellate Tribunal, Allahabad, at the instance of the assessee has referred the following three questions of law for opinion to this court under section 256(1) of the Income-tax Act, 1961, hereinafter referred to as “the Act”.
“1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in holding that the notices issued under section 148 of the Income-tax Act, 1961 addressed as M/s. Shri Nath Suresh Chand Ram Naresh, karta Shri Nath, were valid notices to assess the income of the Hindu undivided family of M/s. Munnalal Motilal or Motilal Shri Nath or its successors?
2. Whether, on the facts and in the circumstances of the case, the returns filed by Suresh Chand without filling in the column relating to status were valid returns?
3. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in holding that the infirmity in the notices issued under section 148 of the Income-tax Act, 1961 was cured under section 292B of the above Act?”
2. The facts of the case are as follows: The assessment years involved are the assessment years 1968-69 to 1976-77. The Tribunal in its order has held that the reassessment proceedings for the assessment years 1970-71 to 1976-77 are not valid and set aside the reassessment orders for these years with the direction to the Income-tax Officer to proceed to comply with the various provisions of section 171 of the Act. However, the service of the notice under section 148/139(2) for all these years was found valid and the jurisdiction for reassessment or assessment was correctly exercised by the Income-tax Officer.
3. M/s. Munnalal Motilal was a Hindu undivided family of which Shri Munna Lal was the karta. This Hindu undivided family was duly assessed under the Act up to the assessment year 1966-67 vide GIR No. 711-M. Shri Moti Lal, the karta of the Hindu undivided family, died some time in the month of April, 1967. Thereafter the business which was carried on by M/s. Munnalal Motilal was carried on later on in the name and style of M/s. Motilal Sri Nath, in the status of the Hindu undivided family through its karta Sri Nath. On July 31, 1969, there was a partition in the family and the capital of the Hindu undivided family amounting to Rs. 14,716.66 was divided between three brothers, namely, Sri Nath, Suresh Chand and Ram Naresh who were coparceners also. According to the assessee, it was oral partition and it is evident by the entries in the books of account. The two brothers, namely, Sri Nath and Suresh Chand after partition started business in partnership in the name of Sri Nath Suresh Chand. The third brother Shri Ram Naresh left the scene. The said partnership, namely, Sri Nath Suresh Chand was also dissolved on March 31, 1972. Thereafter, Suresh Chand started his separate business of Sarrafa with effect from April 1, 1972, in the name and style Suresh Chand Manish Kumar and Sri Nath also started his separate business in the name of Sri Nath.
4. The Income-tax Department on November 18, 1976, searched the premises of the assessee and seized the books of Motilal Sri Nath, Sri Nath Suresh Chand and Suresh Chand Manish Kumar. It may be noticed here that prior to the aforesaid search, the various members of the family, namely, Sri Nath, Suresh Chand, Smt. Kamala Devi, a widow of the late Moti Lal, Shakuntala Devi, wife of Sri Nath, Smt. Asha Rani, wife of Suresh Chand and Smt. Santosh Kumari, wife of Ram Naresh had filed their income-tax returns in their individual capacities in 1975-76. These persons also disclosed that the Hindu undivided family named and styled as M/s. Munna Lal Moti Lal through Moti Lal as karta was dissolved in the year 1967 on account of the death of Shri Moti Lal who died in April, 1967. Thereafter the Hindu undivided family business was carried on by Sri Nath as karta under the name and style of M/s. Moti Lal Sri Nath up to July 31, 1969, when the partition took place.
5. The Income-tax Officer was of the view that the oral partition as alleged by the assessee was not recognized by the Department as no order under section 171 of the Income-tax Act was passed and, therefore, the Hindu undivided family continued to exist. He was of the opinion that the seized account books showed that there was escapement of income of the Hindu undivided family. He obtained a sanction of the Commissioner of Income-tax on December 30, 1976, under section 151 of the Act. In the proposal submitted to the Commissioner of Income-tax, the Income-tax Officer recorded the reasons by describing the name of the assessee as “M/s. Sri Nath Suresh Chand Ram Naresh, karta Sri Nath, Mohalla Saraugi, Barabanki”. The status of the assessee was described as of Hindu undivided family. The Commissioner granted the sanction and notice under section 148 of the Act was issued on December 9, 1976, for the assessment years 1972-73 to 1975-76. Subsequently, a similar notices for the assessment years 1968-69 and 1969-70 were issued on January 28, 1977. A similar notices were issued for the assessment years 1970-71, 1971-72 on February 23, 1977. In the notice issued under section 148, the Income-tax Officer recorded the reasons “as return not filed”.
6. The above reassessment notices were duly served on Sri Suresh Chand, who filed returns declaring the incomes at nil figure. Along with the return he wrote a letter to the Income-tax Officer on April 3, 1977, stating that no business was being done in the name of the noticee, the notices were wrongly issued. However, it was stated that the returns were being filed in compliance with the notice. He left the column of the status blank meaning thereby that the status of the assessee on whose behalf the above returns were being filed, were not mentioned in the return although the returns were signed by Shri Suresh Chand.
7. The assessee repeatedly asked the Income-tax Officer during the reassessment proceedings that notices had been issued to a wrong person, who did not carry on any business and, therefore, there was no escapement of any income. The Income-tax Officer by means of his reply/letter dated March 16, 1978, addressed to Sri Nath, Suresh Chand, Ramesh Chand as coparceners of the Hindu undivided family styled as M/s. Munna Lal Mori Lal clarified the position. Paragraphs 3 and 4 of the said letter are being reproduced here as has been quoted in the statement of the case, by the Tribunal:
“M/s. Munna Lal Moti Lal was assessed to income-tax in the status of Hindu undivided family and you all are the coparceners of the above Hindu undivided family. In this connection please note that neither has there been any claim to the partition of the family styled as M/s. Munna Lal Moti Lal nor has any order to this effect been passed under section 171(3) of the Income-tax Act, 1961, the business continues to be that of the Hindu undivided family irrespective of the fact under what name the business is carried out in the market and the notices issued earlier under section 148 were meant for the Hindu undivided family.
In case you had filed the returns for the assessment years 1968-69 to 1976-77 showing Nil income under any misconception, you are given another opportunity to file a return even now in the status of the Hindu undivided family.”
8. Thereafter Suresh Chand through his letter dated March 23, 1978, challenged the jurisdiction of the Income-tax Officer to reassess the income under section 147 of the Act, as notices under section 148, are invalid and without jurisdiction.
9. The Income-tax Officer rejected the contention of the assessee and held that he had jurisdiction to initiate the proceedings under section 147 of the Act as it is admitted by the assessee that there was a Hindu undivided family named and styled as M/s. Munna Lal Moti Lal, which was assessed to tax under the Act. The said entity continues to exist under the Act unless a partition is recorded by the income-tax authorities under section 171 of the Act. The theory of oral partition has no relevance for income-tax purposes and such partition cannot be recognised in income-tax proceedings in the absence of an order recognizing the partition passed under the Act. In appeal the Appellate Assistant Commissioner confirmed this part of the order and he also took support from section 292B of the Act. In further appeal the Tribunal has confirmed this part of the assessment order and rejected the contention of the assessee that the reassessment notice was issued in the name of a wrong person and as such the entire proceedings are vitiated being without jurisdiction. However, the Tribunal has found force in the submission of the assessee that there was evidence to show that the claim of partition dated July 31, 1969, was made before the Income-tax Officer, which has not been enquired into. The Tribunal, accordingly, set aside the reassessment orders for the assessment years 1970-71 to 1976-77 and restored the matter to the file of the Income-tax Officer to proceed in the matter after complying with the provisions of section 171 of the Act and then reframe the assessment orders.
10. Heard Shri Vikram Gulati, learned counsel for the assessee, and Shri Dhananjay Awasthi, learned counsel for the Department and perused all the three orders and record of the case.
11. Learned counsel for the assessee submitted that the reassessment notice was issued in the name of Sri Nath Ram Naresh Suresh Chand, Barabanki for all the assessment years and reason for issuance of the notice was that the return was not filed. Copies of these notices have been made part of the paper book. Elaborating the argument, it was submitted that there was no such person or legal entity on the file of the Income-tax Department in the name of the noticee. No business was being done by the noticee. The Income-tax Officer intended to assess the escaped income of the Hindu undivided family of Munna Lal, Moti Lal Hindu undivided family which was a different legal entity having been allotted GIR No. 711-M. A separate GIR number was given by the Department to the noticee being GIR No. S-229. The issuance of a valid notice and its valid service on the assessee is sine qua non for assumption of jurisdiction under sections 147 and 148 of the Act. The reassessment notices having not been validly served on the assessee and the notices were addressed to a wrong person, the reassessment proceedings are invalid and, without jurisdiction. In support of his submission counsel has placed reliance on the following rulings:
(i) ITO v. Chandi Prasad Modi, [1979]119 ITR 340 (Cal);
(ii) Madanlal Chowdhury v. ITO, [1979]119 ITR 351 (Cal) (Appex.);
(iii) Madan Lal Agarwal v. Commissioner Of Income-Tax, Kanpur., [1983]144 ITR 745 (All); and
(iv) CIT v. Bibhuti Bhusan Mallick, [1987]165 ITR 107 (Cal).
12. In contra, learned standing counsel for the Department, Shri Dhananjay Awasthi, supported the order of the Tribunal and submitted that in view of section 292B of the Act, the defects, if any, in the notice or its service on the assessee stands cured and the proceedings cannot be held invalid. Reliance has been placed on the following cases:
(i) CIT v. Anand and Co., [1994]207 ITR 418 (Cal);
(ii) CIT v. Rajbir Singh (HUF), [1998]233 ITR 126 (P & H); and
(iii) Mulchand Rampuria v. ITO, [2001]252 ITR 758 (Cal).
13. We have given our careful consideration to the respective submissions of learned counsel for the parties. The Tribunal has held that the notice issued by the Income-tax Officer under section 148 of the Act was legal and valid. It was of the view that the existence of the Hindu undivided family of M/s. Munna Lal Moti Lal was not in dispute. The said Hindu undivided family continued even after the death of its then karta, namely, Moti Lal, although the assessee and its various members in their letters to the Income-tax Officer incorrectly described that the firm M/s. Munna Lal Moti Lal was dissolved in 1967, after the death of Moti Lal, but in the eyes of law, a Hindu undivided family is never dissolved on account of death of the karta and admittedly in the present case after the death of Moti Lal, the Hindu undivided family business was continued till the assessment year 1970-71 by Sri Nath as karta. The Tribunal has also observed that in the reassessment notice, the Hindu undivided family was named by the Income-tax Officer as M/s. Sri Nath Suresh Chand Ram Naresh, but he correctly stated the name of the karta as Sri Nath and no fault could be found out on the part of the Income-tax Officer for giving a different name. Reliance has been placed by the Tribunal in support of its finding on the cases of Mohammad Haneef v. CIT, [1955]27 ITR 447 (All) and Radhey Lal Balmukund, In re, [1942]10 ITR 131 (All). But these cases were rendered under the Indian Income-tax Act, 1922, and were not concerned with the validity of the reassessment notice and have been distinguished, on several occasions by this court as well as by other High Courts in view of the subsequent pronouncement of the Supreme Court in the cases of Y. Narayana Chetty v. ITO, [1959]35 ITR 388 and CIT v. K. Adinarayana Murty, [1967]65 ITR 607. A Division Bench of this court in the case of Madan Lal Agarwal v. Commissioner Of Income-Tax, Kanpur., [1983]144 ITR 745 (All) has held that the pronouncement of this court in the case of Radhey Lal Balmukand, In re, [1942]10 ITR 131 has no application to the question relating to the validity of reassessment notice under section 148 of the Act. In the case of Radhey Lal Balmukand, In re, [1942]10 ITR 131 (All) it has been held as noticed in the case of Madan Lal Agarwal v. Commissioner Of Income-Tax, Kanpur., [1983]144 ITR 745 (All) that merely because while issuing a notice under section 22, calling upon an assessee to file a return under section 22 of the Indian Income-tax Act, 1922, the Income-tax Officer does not indicate the capacity in which the assessee is to file the return, the notice and the proceedings following thereupon do not stand vitiated. It was pointed out that once the Income-tax Officer calls upon a person to file a return under section 22 of the old Income-tax Act, he cannot be in a position to know the capacity in which he may be receiving the income. In these circumstances, it is for the assessee himself to inform the Income-tax Officer as to what income and in which capacity he has received the same. In the case of Madan Lal Agarwal v. Commissioner Of Income-Tax, Kanpur., [1983]144 ITR 745 (All) it was held that these reasons will not apply to a case where the escaped income of an assessee is to be taxed. In the case of Mohammad Haneef v. CIT, [1955]27 ITR 447 (All) the notice issued under section 34 of the old Income-tax Act did not specify the status in which it had been issued to the assessee. However, the High Court construed the notice as clearly indicating the capacity in which it has been issued to the assessee and held that in these circumstances it could not be said that the notice was vitiated merely because it did not specify the status in which it had been issued to the assessee. Much water has flowed since then and the Supreme Court in the case of CIT v. K. Adi-narayana Murty, [1967]65 ITR 607 has held that the reassessment notice should specify the correct assessment year and should be issued to a particular assessee. The correct status of the assessee was that of a Hindu undivided family and since the notice was issued under section 34 of the old Income-tax Act to the assesses as an individual and for making assessment in that capacity, it was held that the proceedings taken under that notice were illegal and without jurisdiction.
14. Under section 2(31) of the Act “person” includes an individual or a Hindu undivided family or company, firm, an association of person or body of individuals, whether incorporated or not, etc. They are distinct and different assessees and each one has a different legal entity so far as the Income-tax Act is concerned. The service of the prescribed notice on a particular assessee, who is to be assessed is a condition precedent to the validity of any assessment to be made under section 147 of the Act. It is the very foundation of the jurisdiction of the assessing authority. As indicated above, the Supreme Court in the case of CIT v. K. Adinarayana Murty, [1967]65 ITR 607 has held that if a notice has been issued to a person having been of a particular status as described in the notice, the reassessment proceedings assessing escaped income of a different status of the assessee is illegal and without jurisdiction. Munna Lal Mori Lal was a Hindu undivided family and was being assessed under the Act through its karta, Sri Moti Lal, who expired in April, 1967. A separate GIR No. 711-M had also been attached to the said Hindu undivided family by the Income-tax Department. It is also established that the Hindu undivided family does not come to an end on account of the death of the karta. It is also the case of the assessee that after the death of Moti Lal, Sri Nath became the karta of the Hindu undivided family of Munna Lal Moti Lal and the business was done in the name of M/s. Moti Lal Sri Nath. In the search, the books of Moti Lal Sri Nath, etc. were seized. Admittedly, no notice in the name of M/s. Munna Lal Moti Lal Hindu undivided family was issued by the Income-tax Officer to reassess the escaped income, if any, of the said Hindu undivided family. Notice was served on Sri Suresh Chand who filed the return declaring income at nil figure and also informed the Income-tax Officer through letters dated April 3, 1977, and August 9, 1977, stating that the notices had been issued to the wrong person who did not carry on any business and, therefore, there was no consequent escapement of any income. The Income-tax Officer in reply to the letters of Suresh Chand accepted the position that M/s. Munna Lal Moti Lal is assessed to the income-tax in the status of the Hindu undivided family. He insisted that the business continues to be that of Hindu undivided family as the partition claimed by the coparceners has not been recognized by the Department by passing an order under section 171(3) of the Income-tax Act. Therefore, the Department was aware about the Hindu undivided family styied as M/s. Munna Lal Moti Lal and the alleged escaped income of that Hindu undivided family was being sought to be assessed under section 147 of the Act but no attempt was made by the Department to issue a notice for reassessment in the name of M/s. Munna Lal Moti Lal. The question now arises whether a notice not correctly addressed to the assessee is a valid notice within the meaning of sections 147 and 148 of the Act or not. This court in the case of Madan Lal Agarwal v. Commissioner Of Income-Tax, Kanpur., [1983]144 ITR 745 has held that a vague notice is an invalid notice and in such a case the vagueness cannot be removed by reference to other documents on the record. The notice was intended to be issued to the assessee in the status of a Hindu undivided family but the notice was not addressed to the assessee-Hindu undivided family, an entity different from the assessee (individual) the notice issued to the assessee was vague and as such invalid. The vagueness of the notice, it was held, did not stand cured, because the Income-tax Officer at a latter stage informed the assessee that he was required to file his return in the status of Hindu undivided family.
15. ITO v. Chandi Prasad Modi, [1979]119 ITR 340 (Cal) is an authority for the proposition that when the Income-tax Officer had full knowledge of the separate identity of two concerns but in spite of it there was neither anything in the notice nor otherwise to show to which of the two concerns, the partnership firm or the Hindu undivided family the notice was directed, it was held that as there was nothing to show whether the impugned notice was for the partnership or the Hindu undivided family, the impugned notice was vague and was invalid. The respondent in that case was a member of a Hindu undivided family, who carried on a joint family business under the name and style of Bhimraj Banshidhar, at 180, Mahatma Gandhi Road, Calcutta. At the same address, the respondent was also carrying on business in a partnership under the same name and style, i.e, Bhim Raj Banshidhar. A notice was issued in the name of M/s. Bhimraj Banshidhar seeking to reopen the assessment of the firm and notice was addressed to M/s. Bhimraj Banshidhar. It was held that the said notice being vague is illegal and without jurisdiction.
16. In Madanlal Chowdhury v. ITO, [1979]119 ITR 351 (Cal) (Appex.) there were two Hindu undivided families, one was a bigger Hindu undivided family and another was a smaller Hindu undivided family. The Calcutta High Court accepted the contention that from the notice it was not clear whether the notice was intended for the bigger Hindu undivided family or the smaller Hindu undivided family or the partnership firm which was formed after disruption of the smaller Hindu undivided family, and as such the notice is bad.
17. CIT v. Bibhuti Bhusan Mallick, [1987]165 ITR 107 (Cal) is an authority for the proposition that where the name of the assessee was not correctly mentioned in the notice issued under section 148 of the Act, the notice was illegal and reassessment made was not valid in law.
18. Reverting to the facts of the present case, it is crystal clear that the Department is seeking to reassess the income of Munna Lal Moti Lal Hindu undivided family, under section 147 of the Act. It is further established that no notice was issued to Munna Lal Moti Lal Hindu undivided family under section 148 of the Act. The reassessment notice was issued in the name of Sri Nath Suresh Chand Ram Naresh and a different GIR number other than that of M/s. Munna Lal Moti Lal was given. Meaning thereby, the Department intended to issue reassessment notice not to M/s. Munna Lal Moti Lal Hindu undivided family, but to some different person. The notice was vague. It was addressed to Sri Nath Suresh Chand Ram Naresh. There was no Hindu undivided family named as Sri Nath Suresh Chand Ram Naresh. This defect in the notice was also pointed out by the assessee through the letter/reply dated April 3, 1977, and the letter dated March 16, 1978, of the Income-tax Officer would not cure the defect in the notice as no notice in the name of Munna Lal Moti Lal Hindu undivided family was issued under section 148 of the Act which is a jurisdictional notice.
19. It is settled law that service of a valid notice under section 148 is the foundation for the initiation of reassessment proceedings and a condition precedent for the validity of the notice. A Full Bench decision of this court rendered under section 21 of the U.P Sales Tax Act which is in pari materia with section 147 of the Act says so. This has been so held in Laxmi Narain Anand Prakash v. CST, [1980] UPTC 125; [1980] 46 STC 71 (All) [FB]. In this case the High Court has relied upon a number of cases relating to service of reassessment notice under the Income-tax Act including Bhag-wan Devi Sarogi v. ITO, [1979]118 ITR 906 (Cal) and quoted the following passage from it (page 77):
“… If the authority concerned does not acquire jurisdiction in the absence of a valid notice being served, the entire proceeding will be without jurisdiction and void, and even consent on the part of the assessee would confer no jurisdiction on the “Income-tax Officer.”
20. The Kerala High Court in P.N Sasikumar v. CIT, [1988]170 ITR 80 has held that the issue of a notice under section 148 of the Income-tax Act, 1961, is a condition precedent to the validity of any assessment order to be passed under section 147 of the Act. It is also settled law that if no such notice is issued or if the notice is invalid or is not in accordance with law or is not served on the proper person in accordance with law, the assessment would be illegal and without jurisdiction. The notice should specify the correct assessment year and should be issued to the particular assessee. The notice issued to the assessee in that case did not specify the capacity in which it was issued to one S, whether as individual or as “principal officer” or as a member of an association or body of individuals. The assessment was completed by the Income-tax Officer in the status of an association of persons consisting of S and some others. It was held that before assessing an association of persons, the notice should be addressed to the “principal officer” or a “member” thereof as required by section 282(2)(c), which was not done. Such a fundamental infirmity, it was held, could not be called a “technical objection” or a mere irregularity, such vital infirmity could not be cured or obliterated by placing reliance on section 292B.
21. A Division Bench of this court in the case of Madan Lai Agarwal v. CIT, [1983]144 ITR 745 has held that a notice contemplated by section 148 is a jurisdictional notice for initiating proceedings for making an assessment under section 147 and any defect in that notice cannot be cured by any thing done by the Income-tax Officer subsequently. A vague notice is an invalid notice and in such a case vagueness cannot be removed by reference to the other documents on the record. If a notice itself is otherwise bad in law, the invalidity thereof cannot be cured by any act of the assessee to whom the said notice is issued.
22. In view of the above, we hold that no valid notice was served on the assessee to reassess the income of M/s. Munna Lal Moti Lal, Hindu undivided family, the notice being vague is invalid and, therefore, all the consequent proceedings are null and void.
23. At this stage, it is apt to consider the rulings relied upon by the learned standing counsel for the Revenue.
(1) CIT v. Anand and Co., [1994]207 ITR 418 (Cal).
24. Briefly the facts of this case are that a notice under section 148 of the Act for reassessment was issued. In the said notice the validity of the mode of issuance of notice under section 148 of the Act was not at all the subject-matter of the case. The allegation of the assessee was that the notice did not contain the distinct signature of the Income-tax Officer. On this contention no finding was given by the Commissioner of Income-tax (Appeals). But the assessment itself was set aside by him on the grounds of want of initial jurisdiction. In the second appeal preferred by the Revenue, the Tribunal initially passed an order in favour of the assessee upholding the findings of the Commissioner of Income-tax (Appeals) as to non-maintainability of the provisions of section 147(b) and invalidity of the initiation of proceedings. Subsequently, the Tribunal, on a miscellaneous petition filed by the assessee pleading as regards the illegality of notice itself by reason of manner of signature of the issuing officer appearing on the notice came to the conclusion that the said notice does not bear the authentic signature of the issuing officer. The case was decided in this factual background. To say the least there is no similarity in between the facts of the case relied upon by learned counsel for the Revenue and the facts of the case in hand. In the case in hand there is no dispute with regard to the question that the reassessment notice was not signed by the officer concerned. Therefore, the aforesaid ruling does not advance the case of the Department.
25. The next case relied upon is CIT v. Rajbir Singh (HUF), [1998]233 ITR 126 (P & H). It appears that the learned standing counsel has cited the above case even without caring to read it. The said judgment of the High Court is on the income-tax application directing the Tribunal to refer the question framed therein for the opinion of the court as the High Court was of the opinion that a question of law arises from the order of the Tribunal.
26. The next case relied upon is Mulchand Rampuria v. ITO, [2001]252 ITR 758 (Cal). The said case is also not applicable. The assessee in that case had challenged the validity of the reassessment notice by filing a writ petition in the High Court on the ground that there was no material before the assessing authority to form a belief that the income of the assessee has escaped the assessment. The High Court on the facts of that case held that the assessing authority had the authority to issue such notice. Since no such question is involved in the present case the said case has hardly any application to the facts of the present case. It was held that the sufficiency or the correctness of the material is not a thing to be gone into by the court hearing the question of validity of issuance of fresh assessment notice under section 148 of the Act.
27. In view of the above discussion none of the authorities relied upon by learned standing counsel have any application to the facts of the present case. Learned standing counsel cited the above rulings little realizing that these rulings do not have any application to the facts of the present case or to the question of law involved therein.
28. The upshot of the above discussion is that the Tribunal was not right in holding that the notice issued under section 148 of the Act addressed as Sri Nath Suresh Chand Ram Naresh karta Sri Nath were valid notices, to assess the income of the Hindu undivided family of M/s. Munna Lal Moti Lal or Moti Lal Sri Nath or its successors.
29. No argument was advanced by learned counsel for the assessee on question No. 2, therefore, it is returned unanswered.
30. Now we take up question No. 3 for consideration. Section 292B of the Act reads as follows:
“292B. Return of income, etc., not to be invalid on certain grounds.—No return of income, assessment, notice, summons or other proceeding furnished or made or issued or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or shall be deemed to be invalid, merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act.”
31. The question is whether the notice issued under section 148 of the Act, to a wrong person can be treated as a valid notice with the aid and help of section 292B of the Act? To answer this, it is necessary to understand the importance of a valid notice and the nature of reassessment proceedings, first. As already discussed in the earlier part of this judgment that service of a valid notice is mandatory to initiate reassessment proceedings under section 147 of the Act. In view of the above, the Tribunal has wrongly held that section 292B of the Act will have application to the facts of the present case. The said section condones the invalidity which arises merely by reason of any mistake, defect or omission in a notice, if in substance and effect it is in conformity with or according to the intent and purpose of the Act.
32. In the result, questions Nos. 1 and 3 are answered in the negative, i.e, against the Revenue and in favour of the assessee. Question No. 2 is returned unanswered. No order as to costs.