The Department's inquiry under Section 147 must be limited to items of underassessment, and general inquiries must be made within the stipulated period.

Hemant Gupta, J.

1. Challenge in the present writ petition under Articles 226/227 of the Constitution of India is to a show cause notice dated April 30, 2001 (annexure P 11) issued to the petitioner in respect of the assessment year 1998-99 to the effect that income chargeable to tax has escaped assessment within the meaning of Section 147 of the Income-tax Act, 1961 (hereinafter to be referred to as "the Act").

2. The petitioner filed his return of income on October 31, 1998, for the assessment year 1998-99 relating to the previous year with effect from April 1, 1997, to March 31, 1998. The income-tax return included the income from house property, income from business and profession as well as audit report prescribed under Section 80HHC of the Act. The petitioner is engaged in the business of exporting goods outside the country.

3. The petitioner has alleged that he did not receive any intimation from the Department even after one year of the filing of the return. On June 16, 2000, the Assistant Commissioner of Income-tax, Jalandhar, intimated the petitioner that the return of income filed by him was defective for the reasons that the return and the computation of income are unsigned and that the original advance tax challan for Rs. 10,000 has not been furnished. The petitioner furnished requisite information within 10 days. But no order of assessment was communicated. Thus, the return filed by the petitioner would be deemed to be accepted. However, on April 30, 2001, the Assessing Officer issued notice under Section 148 of the Act to file return in the prescribed form on the ground that the income assessable, has escaped assessment within the meaning of Section 147 of the Act. The petitioner filed reply to the said notice and stated that the income-tax return has already been filed. Subsequently, the petitioner filed return of income showing the same income as was declared in the earlier return filed on October 31, 1998.

4. In response to the request of the petitioner to supply the reasons for initiating proceedings under Section 148 of the Act, the petitioner was informed on February 11, 2002 (annexure P 17) that he has not furnished information/ evidence with regard to the claim under Section 80HHC as sought for in the letter dated June 16, 2000. But the same was not furnished. Notice under Section 148 of the Act was issued for the reason as the petitioner has failed to furnish the necessary evidence to substantiate the deductions claimed. The petitioner has also alleged that earlier the Department has communicated on January 25, 2002, annexure P 15, that the case of the petitioner for the assessment year 1998-99 has been selected for scrutiny and sought detailed information on various accounts including the details of vehicles owned by the petitioner and his family members, details of immovable property, etc., etc.

5. The petitioner has thus filed the present writ petition challenging the issuance of show cause notice under Section 148 of the Act annexure P 11 as well as the information sought for by the Department vide communication dated January 25, 2002, annexure P 15.

6. The argument raised by learned counsel for the petitioner is that on filing of the return under Section 142 of the Act, the Assessing Officer could call upon the assessee within 12 months as provided under Section 143(2) of the Act to produce any evidence on which the assessee may rely in support of the return. Since the Assessing Officer has failed to issue any notice within 12 months, the returned income would be deemed to be accepted. The income is sought to be reassessed vide notice anneuxre P 11, dated April 30, 2001, of the reasons disclosed on February 11, 2002, that is in respect of the claim of the petitioner under Section 80HHC of the Act. Thus, the Department can seek information only in respect of the claim of the petitioner under Section 80HHHC and not in respect of other claims as fishing inquiry is sought to be made vide commun