JUDGMENT

Pathak J.

1. The Income Tax Appellate Tribunal has referred the following question :

" Whether, on the facts and circumstances of the case, the Tribunal was justified in upholding the order of the Appellate Assistant Commissioner directing the Income Tax Officer to make a fresh assessment after issuing a proper notice u/s 23(2) of the Income Tax Act, 1922, for the assessment year 1960-61 ? "

2. The assessee is Sant Baba Mohan Singh. He has been assessed as an individual for the assessment year 1960-61 for which the relevant account year ended on March 31, 1960. In response to a notice u/s 22(2) of the Income Tax Act, 1922, he filed a return showing his income as nil. In the return he made a note saying that he was engaged in the service of the public for religious and charitable purposes and therefore had no personal income. The Income Tax Officer, however, estimated the assessee's net income at Rs. 1,00,000 and made an assessment order accordingly. On appeal by the assessee, the Appellate Assistant Commissioner found that the assessment was completed u/s 23(3) without the issue of a notice u/s 23(2). He set aside the assessment and directed the Income Tax Officer to make a fresh assessment after issuing notice u/s 23(2). In second appeal before the Income Tax Appellate Tribunal, the assessee contended that the Appellate Assistant Commissioner should have annulled the assessment and it had no power to set aside the assessment and direct a fresh assessment. The appeal was dismissed by the Tribunal.

3. Learned counsel for the assessee contends that the case fell for disposal by the Appellate Assistant Commissioner u/s 31 (3)(a) and not u/s 31(3)(b), and the direction of the Appellate Assistant Commissioner to the Income Tax Officer to make a fresh assessment is without jurisdiction. The submission is that a notice u/s 23(2) is a jurisdictional notice, and reliance is placed on RAJMANI DEVI Vs. COMMISSIONER OF INCOME TAX, U.P. where it has been held that such a notice is imperative or mandatory in character. The notice being imperative or mandatory, the argument goes on, the Income Tax Officer had no jurisdiction in the absence of such notice to complete the assessment u/s 23(3). It is urged that the power conferred u/s 31(3)(b) to set aside the assessment and direct the Income Tax Officer to make a fresh assessment is a power exercised when the assessment is a valid proceeding. It seems to us that the contention that the Appellate Assistant Commissioner should have made an order u/s 31(3)(a) must be negatived. Section 31(3)(a) speaks of the power of the Appellate Assistant Commissioner to annul an assessment. That is a power to be exercised where the assessment proceeding is a nullity in the sense that the Income Tax Officer had no jurisdiction ab initio to take the proceeding. A proceeding is a nullity when the authority taking it has no jurisdiction either because of want of pecuniary jurisdiction or of territorial jurisdiction or of jurisdiction over the subject-matter of the proceeding. A proceeding is a nullity when the authority taking it has no power to have session over the case. The omission of the Income Tax Officer to issue a notice u/s 23(2) does not affect the ab initio jurisdiction enjoyed by the Income Tax Officer in respect of the proceeding. The Income Tax Officer had session over the case, he had overall jurisdiction over the case and in that sense had power to initiate the proceeding. The omission to issue a notice u/s 23(2) merely prevents the Income Tax Officer from making an assessment order u/s 23(3), and after he rectifies the omission by issuing that notice he can proceed further to the next stage, that is, to exercise the power of completing the assessment u/s 23(3). All these are steps within the overall jurisdiction vested in the Income Tax Officer over the entire assessment proceeding. We are of definite opinion that the failure of the Income Tax Officer to issue a notice u/s 23(2) does not call