1. This is an application challenging the notices under Section 148 of the Income-tax Act, 1961, for the assessment years 1951-52 to 1962-63 and the notices dated 7th June, 1968, under Section 142(1) of the said Act for the assessment years 1951-52 to 1962-63. The petitioner was served with the notices for the opening of certain assessment of a Hindu undivided family, Messrs. Pannalal Bajaj Shyam Sundar Bajaj Various points were taken in support of this application. It was stated, that there were no materials for the Income-tax Officer, to form any belief that there was any Hindu undivided family at the relevant time or that the income of the family had escaped assessment. The notice was also challenged on the ground that the notice had been served on the Hindu undivided family without indicating on whom the notices had to be served. The notices were vague, it was also urged. It seems that the facts and the reasons relied on for starting the proceedings under Section 147 are that one Pannalal Bajaj, who was the father of the petitioner, had stated in connection with a suit being Suit No. 2006 of 1963 that there was a joint Hindu family and certain properties and assets belonged to the said joint Hindu family. The petitioner filed the suit for the dissolution of certain partnership business. In the said suit Pannalal Bajaj took the defence that the said property did not belong to any partner but to the said Hindu undivided family and the said family had been disrupted in 1963. It is not disputed that the Hindu undivided family had never been taxed before. Counsel for the petitioner at the time of hearing of this application sought to urge that after dissolution of the Hindu undivided family it was no longer possible to assess the Hindu undivided family even for the period during which it was joint. As this point was not specifically taken in the petition, I directed the petitioner to file a supplementary affidavit indicating that point and also gave leave to the respondents to file an affidavit in-oppostion dealing with the said contention. The said affidavits have been filed.
2. The first question that requires determination in this case is whether there were materials before the Income-tax Officer to initiate the proceedings for the reopening of the assessment of the said Hindu undivided family. The reasons for initiating the proceedings had been produced before me and also indicated to a certain extent in the affidavit on behalf of the respondents. It appears that the main reason for repening the said assessment was that the Hindu undivided family had certain income which had escaped assessment and that information was obtained from the affidavit of Sbri Pannalal Bajaj in the aforesaid suit. Counsel for the petitioner drew my attention to several decisions and contended that no sufficient reasons had been indicated. Reliance was placed on the decision in the case of Chhugamal Rajpal v. S. P. Chaliha, and on the decision of the Supreme Court in the case of Commissioner Of Income Tax, Calcutta v. Burlop Dealers Ltd.† ., Reliance was placed on the decision of the Supreme Court in the case of Sheo Nath Singh v. Appellate Assistant Commissioner of Income-tax, [1972] 82 I.T.R. 147 (S.C.). Whether there are reasons for reopening a particular assessment or not, must necessarily depend on the facts of each particular case. The reasons indicated are the statements contained in the affidavit of Pannalal Bajaj. Prima facie those reasons are not unreasonable. If that information had reached the income-tax department and if on the basis of that information the Income-tax Officer had formed the belief that there was a Hindu undivided family and that the income of that Hindu undivided family had escaped assessment, and in view of the entire statement made in the affidavit of Pannalal Bajaj that the Hindu undivided family was such a family which had assessable income, in my opinion it cannot be said that the Income-tax Officer, acted without any reason in reopening the said assessment.
3. There is, however, one difficulty for the respondents. The Income-tax Officer, in his supplementary affidavit as well as in the original affidavit had only indicated that he had relied as to his source of the reasons on the affidavit of Pannalal Bajaj. He did not make any independent enquiry. Pannalal Bajaj in his affidavit had stated that the said Hindu undivided family had disrupted. If the said Hindu undivided family had been disrupted, the assessment of the said Hindu undivided family cannot be reopened after disruption even for the period when it was joint. In the case of Rameswar Sarkar v. Income-tax Officer, [1973] 88 I.T.R. 374 (Cal.) I have held that after disruption of the Hindu undivided family that family cannot be proceeded against in respect of its income, if that family was never assessed to tax before. The income-tax department, however, can proceed if the income-tax department is of the opinion that the so-called disruption was fraudulent or colourable and it has in fact continued to be in existence. There is no evidence to that effect. The income-tax department did not make any enquiry. They did not find out whether the Hindu undivided family was in existence or not. They merely relied on the affidavit of Pannalal Bajaj. If the affidavit of Pannalal Bajaj be the source of their knowledge, then the said affidavit also indicated that the family had disrupted. It must be held in view of the fact that there was no plea or material for the income-tax department to form the belief that the said Hindu undivided family had continued and was in existence at the time when the notices under Section 148 were served, in view of my judgment in the aforesaid case. It must be held that the income of the said Hindu undivided family which had escaped assessment cannot be assessed by giving notice under Section 148 of the Income-tax Act,
4. It was next contended that the notices suffered from another infirmity inasmuch as they did not indicate on whom the said notices were required to be served. Reliance was placed on the decision in the case of Sewlal Daga v. Commissioner of Income-tax, [1965] 55 I.T.R. 406 (Cal.).
5. In the instant case as in the aforesaid decision the notices did not state that they were being served on the petitioner in any particular capacity. From that point of view the notices are liable to be quashed. It has however to be observed that the said infirmity applies to notices issued for the assessment years 1951-52 to 1956-57 and 1958-59 and to the notices issued for the assessment years 1963-64 to 1966-67. The said notices are liable to quashed on the additional ground that notices are vague and not in conformity with the provisions of the Act.
6. For the reasons given before this application must succeed. The notices for the assessment years 1951-52 to 1962-63 issued under Section 148 of the Income-tax Act, 1961, and notices under Section 142(1) for the assessment years 1951-52 to 1962-63 are hereby quashed. There will be no order as to costs. The respondents are restrained from giving effect to the said notices. Let a writ in the nature of mandamus issue accordingly. The rule is made absolute to the extent indicated above. There will be stay of the operation of the order for 6 weeks. If any final orders have been passed pursuant to the said notices, the same are hereby also quashed.
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