TMI Blog1965 (5) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... dividends and also director's fees and commission from Star Paper Mills Ltd. and Hall Anderson Ltd. The assessment year in question is 1954-55 and the corresponding previous year is the financial year 1953-54. The Income-tax Officer completed the assessment for the year 1954-55 on 26th March, 1959, on an income of ₹ 42,318. Thereafter, a notice of demand under section 29 of the Income-tax Act demanding the tax due on the amount assessed was served on the assessee on 1st April, 1959. The assessee appealed to the Appellate Assistant Commissioner and also to the Appellate Tribunal but the said appeals were dismissed. On these facts the following question of law has been referred to us : Whether, on the facts and in the cir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to us which, however, has some relevance. In Petlad Bulakhidas Mills Co. v. Raj Singh ([1959] 37 I. T. R. 264), it was held that, where an Appellate Assistant Commissioner made an order on 6th January, 1956, and the order was served on the assessee on January 27, 1956, the application for revision of that order under section 33A(2) filed on January 25, 1957, was made within one year from the date of the order within the meaning of section 33A and was not barred by limitation. This case has only decided that a period of limitation will run only from the date when the order is served on the person who is affected by the order. This must be so. An assessee's statutory obligation to move a higher court or Tribunal against an o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty or liability to pay tax on the part of the assessee, the date of communication may be the most effective date. An order to be communicated must presuppose the existence of an order and the existence of the order is only possible when the Incometax Officer has made that order. From the point of view of the Income-tax Officer, he has discharged the statutory liability to assess if he makes an order of assessment within 4 years after the end of the assessment year. The statute does not say that the Income-tax Officer must communicate the order of assessment within 4 years after the end of the assessment year. We, therefore, cannot accept the contention of the assessee that the date of communication of the order of assessment is the date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of this section shall be made after the expiry of 4 years from the end of the year in which the income, profits or gains were first assessable. In this case it appears the assessment was made on March 26, 1959, that is, within 4 years from the end of the year in which the income was first assessable-the assessment year being 1954-55. In this application we are concerned to see whether the section requires an interpretation to mean whether the expression assessment or reassessment shall be made should be deemed to be made within 4 years within the meaning of this sub-section as soon as the notice of demand is served upon the assessee. Dr. Pal has in this connection referred to us a decision in Petlad Bulakhidas Mills Co. v. Raj Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 34(3) of the Act. This sub-section (3) puts a fetter upon the Income-tax Officer as to the period within which the assessment has to be completed. This section nowhere states as to when the notice of demand should be served upon the assessee and there is no indication in the sub-section to show that the assessment order should be treated as an invalid one, unless an intimation of that order is made to the assessee. An assessment in terms of the Income-tax Act, 1922, must be completed within the time limit laid down in section 34(3), but the Act nowhere imposes any limit of time within which the service of the notice of demand under this section has to be effected. In this view of the matter, we are of opinion that the language of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be attracted to the points of law raised by Dr. Pal, inasmuch as we have already said that they are not sustainable in view of the clear provisions as to the period of limitation, when the assessment by the taxing authority has to be completed. The other decision to which reference has been made is reported in 68 C.W.N. 1109 (Makhan Lal Sen v. Director of Panchayats, Government of West Bengal (A. I. R. 1963 S. C. 395). In this case the order of appointment was made by the Director of Panchayats who was the competent authority under a Government notification. But before the order was communicated to the petitioner it was recalled and cancelled. On these facts this court decided that an order to be effective must be completed and it can only ..... X X X X Extracts X X X X X X X X Extracts X X X X
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