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Section 149 of the Income-tax Act, 1961 [Corresponding to section 34 of the Indian Income-tax Act, 1922] - Income escaping assessment - Time limit for issuance of notice - Assessment year 1948-49 - Whether starting point of eight years period of limitation under section 34(1)(a) of 1922 Act, has to be computed from expiry of assessment year and not from accounting year - Held, yes FACTS The question that arose for consideration in the instant reference was as to the starting point of the period of limitation under section 34(1)(a) of the 1922 Act, i.e., whether the eight years period has to be computed from the expiry of the accounting year or the assessment year. HELD Following the decision in the case of Talluri Raghavaiah v. First Addl. ITO [1962] 44 ITR 136 it was to be held that the eight years period had to be computed from the expiry of the assessment year. In view of aforesaid, the notice served on 21-3-1957 on the assessee under section 34(1)(a) of 1922 Act for the assessment year 1948-49 was valid and could not be impugned. Note : The case was decided in favour of the revenue. CASES REFERRED TO Talluri Raghavaiah v. First Additional Income-tax Officer, Bapatla [1962] 44 ITR 136 (AP) and Pannalal Nandlal Bhandari v. CIT [1961] 41 ITR 76 (SC) JUDGMENT Chandra Reddi, CJ.-The question that arises for consideration in this reference is as to the starting point of the period of limitation under section 34(1)(a) of the Indian Income-tax Act, i.e., whether the eight years period has to be computed from the expiry of the accounting year or the assessment year. This very question fell to be decided by a Bench of this court Talluri Raghavaiah v. First Additional Income-tax Officer, Bapatla [1962] 44 ITR 136. After referring to the various provisions of the Indian Income-tax Act and several of the decided cases, we reached the conclusion that the year contemplated by section 34(1)(a) is the assessment year and not the accounting year. Sri Narasinga Rao for the assessee contends that the judgment of the Supreme Court in Pannalal Nandlal Bhandari v. Commissioner of Income-tax [1961] 41 ITR 76 throws doubt on the correctness of the principle enunciated in Talluri…

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