TMI Blog1995 (2) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... j. Govt. under Raj. Urban Improvement Act, 1959 for Ummed Ind. and Sh. Ummeda Ram received a sum of Rs. 51 lakhs by way of final compensation for the land. The income so earned was liable to be taxed under the head " capital gains ". 3. During his lifetime, Sh. Ummeda Ram was regular assessee of the IT Department and had been filing his returns of income with ITO A-Ward, Jodhpur within whose jurisdiction he and his two sons Sri Ganpat Ram and Sri Madho Singh used to reside at Ratanada. He, however, died on 22-6-1978 without filing his return of income for the year under consideration. He was survived by his three sons, namely, Svs. Champatram, Bhanwar Lal and Madho Singh. 4. Some time in March 1984, the ITO D-Ward, Jodhpur had reasons to believe that by reason of the omission or failure on the part of the assessee to make a return of his income under section 139 for assessment year 1975-76, income chargeable to tax had escaped assessment for that year. He, therefore, issued a notice under section 148 of the IT Act, 1961 (the Act) to the late assessee through his legal representative and son Shri Bhanwar Lal who was living at Ummed Bhawan, 1st Polo, Jodhpur. The case of Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(a) and section 153(2)(a). The ld. D/R stressed that in both the abovementioned provisions the period of limitation is to be reckoned from the end of relevant assessment year and not from the end of financial year as has been mistakenly understood by the ld. DC (Appeals). The ld. D/R could, however, make no affirmative or negative statement with regard to the rest of the points regarding the jurisdiction of ITO Ward-D to issue the notice under section 148 and make assessment in this case or regarding the non-issuance of notices to the other LRs of the deceased assessee. 7. After having heard the parties at length we are of the opinion that the order of cancellation of assessment has to be sustained though for reasons somewhat different from those which found favour with the ld. DC(Appeals). 8. The issues which arise for consideration in this case are :-- (a) Was the notice under section 148 issued within time as prescribed by section 149 ? (b) Was the assessment made within the period of limitation prescribed by section 153(2)? (c) Did the ITO, Ward-D, Jodhpur have the jurisdiction to issue notice under section 148 make assessment in this case ? and (a) Is the assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he relevant assessment year. Nowhere in the language of section 149(1)(a)(1) the term " financial year " has been used. The position has been made clear by the use of the same term of " assessment year " in the language of both sub-sections (1) and (2) of section 151. It is thus abundantly clear that the prescribed period of eight years or 16 years, as the case may be, is to be reckoned from the end of the relevant assessment year and not financial year. 11. Now, coming to the merits of the issue, in this case, the position is some-what confusing. The documents placed on our record show that the ITO had issued two notices under section 148 simultaneously on 27-3-1984 and both were addressed to the deceased assessee through his L/R Shri Bhanwar Lal at his address at 1st Polo, Ummed Bhawan, Jodhpur. One of the notices was served on 30-3-1984 by affixture. The other had been sent by Regd. Post A/D and is said to have been served on 3-4-1984. The assessee relies on the service stated to have been effected on 30-3-1984 by affixture. Revenue has tried to build its case on the service effected on 3-4-1984 by Regd. Post A/D. After a close study of the material placed before us, we are sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... word ' issued ' used in the language of section 149 is required to carry the meaning of the expression ' issued and served ' within the prescribed period of limitation. This view of ours, we think, finds support from the cases of Banarsi Debi v. ITO [1964] 53 ITR 100 (SC), Induprasad Devshanker Bhatt v. J.P.Jani, ITO [1965] 58 ITR 559 (Guj.), Shanabhai P.Patel v. R.K. Upadhyaya, ITO [1974] 96 ITR 141 (Guj.) and [1976] 105 ITR 489 (Sic). 14. Reverting to the point on hand, it may be noted that the relevant assessment year in this appeal is 1975-76 which came to an end on 31-3-1976. The starting point of limitation under section 149(1)(a) was 1-4-1976 and the eighth year from that date expired on 31-3-1984. Since the notice under section 148, according to the assessee himself, was served on him by affixture on 30-3-1984, the notice issued and the assessment proceedings initiated on the basis of such notice were not hit by the provisions of section 149 of the Act. Since service of notice under section 148 on 30-3-1984 is proved, the subsequent service on 3-4-1984 of another notice of the same type would not adversely affect the validity of the notice served on 30-3-1984 and the limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad died on 22-6-1978 leaving behind him three major sons, S/Sh. Ganpat Ram, Bhanwar Lal and Madho Singh, as his L/R survivors, It is also not in dispute that since the ITO had initiated certain proceedings for levying capital gains tax against the partners of the dissolved firm, which partners included some of the LRs of the deceased also. There is thus sufficient evidence on record to show that the ITO very well knew that the deceased assessee had left LRs also other than Sh. Bhanwar Lal to whom only he issued notice under section 148 in this case. He did not issue even notices under section 142(1) to S/Sh. Ganpat Ram and Madho Singh. 16. It is the well settled proposition of law that the estate of a deceased person should be well represented before levy of any liability is imposed upon his estate. The provisions of section 159 of the Act clearly cast the liability on the LRs of the deceased to pay any sum which the deceased assessee would have been liable to pay, if he had not died. But the LR is made liable to pay such sum in the like manner and to the extent as the deceased. It is, therefore, gathered that in order to make the recovery of the liability fruitful, the estate of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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