Law: Income Tax Act, 1922

Section: 34,34(1)(a),34(3)

Indian Income-tax Act, 1922 (XI of 1922)---Sections 34(1)(a), 34(3) Reassessment--Limitation--Existing limitation of eight years--Limitation period amended removing any period of limitation-Reassessment after expiry of eight years---Whether valid in law-Held yes-Finance Act, 1956. Assessment on the assessee for the assessment year 1950-51 was made on January 17, 1955; Later, it came to the notice of the department that the assessee had not disclosed certain income and proceedings under section 34(1)(a) of the Indian Income tax Act 1922 (the Act) were initiated and a notice was served on the assessee on November 30, 1955, and ultimately, Income-tax Officer by order dated March 15, 1961 added an amount of Rs. 1 lakh to the total income of the assessee. On second appeal, the Appellate Tribunal held that the assessment under section 34(1)(a) should have been completed Within 8 years of the assessment year, that is by March 31, 1959, but, as the assessment was made only on March 13,1961, the assessment was barred by limitation and was not valid, On a reference at the instance of the department: Held, that as a result of the amendment of sections 34(1)(a) and 34(3)by the Finance Act, 1956 (18 of 1956) no period of limitation was fixed for reassessment in cases falling under section 34(1)(a).When the amendment in 1956 was engrafted, the proceedings for reassessment were validly initiated and the limitation for making the reassessment still subsisted. When the legislature extended the period of limitation, no vested right had accrued to the assessee, in the sense that the Income tax Officer had, on account of efllux of time, lost jurisdiction to make the assessment. That being so, inasmuch as the Finance Act, 1956, extended the period of limitation it is the extended period of limitation that would apply. Therefore, the Tribunal was not right in law in finding that the assessment made in pursuance of section 34(1)(a) of the Act was barred by limitation. Cases referred to:- Karimtharuvi Tea Estate Ltd. v. State of Kerala [1966] 60 ITR 262 (SC). Prashar (S.C.) v. Vasantsen Dwarkadas (19635 49 ITR (SC). JUDGMENT [The judgment of the court was delivered by C.S.P. SINGH…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492