Law:

Section:

Section 3 of the Wealth-tax Act, 1957 - Hindu undivided family - Assessability of - Assessment years 1970-71 to 1973-74 - Whether assessment completed after coming into force of Kerala Joint Hindu Family (Abolition) Act, 1975, where return was Tiled prior to said enactment, is null and void - Held, no FACTS For the assessment years 1970-71 to 1973-74, the karta of the assessee-HUF filed its returns. After the filing of the original returns and before the assessments were completed, the Kerala Joint Hindu Family (Abolition) Act came into force with effect from 1-12-1976. The assessments were, however, completed on 3-1-1983. The assessee for the first time contended before the Tribunal that since the assessment orders were passed after the coming into force of the Kerala Joint Hindu Family (Abolition) Act, the assessments were illegal and without jurisdiction. Following the decision in the case of WTO v. K. Madhavan Nambiar [1988] 169 ITR 810 (Ker.)(App.), the Tribunal held the assessments as null and void. On reference: HELD It is well settled law that assessment proceedings start either by the filing of a return by the assessee or by the issue of a notice by the assessing authority. It would be pending till a final order of assessment is made in regard to the return filed. In the instant case, the assessments were pending on the day when the Kerala Joint Hindu Family (Abolition) Act came into force. In K. Madhavan Nambiar's case (supra) proceedings under section 17 were initiated after Kerala Joint Hindu Family (Abolition) Act had come into force; no proceedings were pending against the assessee in the aforesaid case. The Tribunal was, therefore, not justified in setting aside the assessments. EDITOR'S NOTE The High Court restored the case to the Tribunal since certain other aspects relevant to the issue had not been adverted to and adjudicated. JUDICIAL ANALYSIS The ratio of the decision in K. Madhavan Nambiar's case (supra) cannot apply to a case where on the date of the coming into force of the Kerala Joint Hindu Family (Abolition) Act, assessment proceedings were admittedly pending against the HUF on the basis of a valid return filed by the karta, for the…

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