Law:

Section:

Section 153 of the Income-tax Act, 1961 [Corresponding to section 34(3) of the Indian Income-tax Act, 1922] - Income escaping assessment - Time limit for completion of - Assessment year 1950-51 - Notice under section 34(1)(a) of the Act was issued more than eight years after expiry relevant assessment year to assessee karta on 2-3-1960 for relevant assessment year on basis of Tribunal's order holding that certain sums did not represent income of Hindu undivided family that assessment proceedings of assessee individual member of HUF were held to be not barred by time in view of either section 34(4)(a) of 1922 Act or second proviso to section 34(3) of 1922 Act - Where since there was neither any finding of Tribunal nor direction in appellate orders as contemplated by second proviso department could make no use of second proviso to section 34(3) of 1922 Act - Held, yes - Whether therefore, notice issued was barred by time - Held, yes FACTS The assessee was the karta of a joint Hindu family. There was a business firm in which assessee and another person were partners. A sum of Rs. 21,079 was introduced as capital in the said firm between 1-4-1949 and 28-2-1950. When the ITO took up assessment of the HUF for the years 1950-51 and 1951-52, he thought that two sums of Rs. 14,167 and Rs. 6,912 represented income of the undivided Hindu family. The joint family was assessed accordingly. That decision was affirmed by the AAC. But the joint family succeeded in further appeal before the Appellate Tribunal. On 7-10-1959, the Appellate Tribunal upheld the contention of the HUF that the two sums of Rs. 14,167 and Rs. 6,912 did not represent income of the undivided Hindu family. Acting on the decision of the Appellate Tribunal, the ITO issued a notice to the assessee under section 34(1)(a) with respect to the assessment year 1950-51, the assessee raised an objection that the notice issued under section 34(1)(a) was barred by time. The objection was overruled by the ITO. Dhiraj Mal was assessed for 1950-51 on the footing that the sum of Rs. 21,079 represented his undisclosed income. The assessee, however succeeded in appeal before the AAC. He held that the reassessment…

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