TMI Blog1956 (3) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... by the respondent on the last day of the maximum period of the eight years within which a notice may be issued under section 34 of the Act. One of these notices was sent by post and was delivered on the following day, the 1st April, to Sri Banarsi Das, a partner of the firm Pushkar Mal Sagar Mal. The learned standing counsel does not contend that this constituted service on the assessees or any of them. The other notice was delivered on the same day, the 31st March, by a peon in the service of the Income-tax Department to one Mahabir Prasad who is a son of Ram Deo, the second petitioner. It is not in dispute that at that time the first and second respondents resided in Jhajhar in Jaipur and that the other three respondents resided at Kanpur. Mahabir Prasad forwarded the notice to his father at Jhajhar who received it on the 22nd April. A reply to this notice was sent by the second petitioner to the respondent on the 27th April. In his reply this petitioner stated that the petitioners did not do any business together as members of a joint family or as an association of persons and that they had never carried on any business together at any time; but as a precautionary measure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. We think it unnecessary to examine each of these submissions as in our opinion the petition can be decided on a short point, that of limitation. A notice, as we have said, under section 34 was issued by the respondent addressed to the petitioners on the 31st March, and it was served on the same day on Mahabir Prasad at Lakhimpur Kheri. None of the petitioners resided at Lakhimpur Kheri but the first and second petitioners Sri Niwas and Ram Deo were two of the five partners of Messrs. PushKarmal Sagar Mal, a firm which had come into existence in March, 1948, and carried on business at Lakhimpur Kheri. The learned standing counsel contends that service of the notice upon Mahabir Prasad was in law a notice upon the petitioners ; alternatively he argues that provided the notice is issued, as admittedly it was, within the period of eight years, service of the notice could be effected after the expiry of that period and the admitted receipt of the notice by Ram Deo the second petitioner on the 22nd April, constituted due service on the petitioners. The notice was addressed to M/s. Sri Niwas, Ram Deo, Chaju Ram, Ram Kumar and Balkishan and in it the respondent stated tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... easons other than the omission or failure of the assessee to make a full disclosure. The sub-section then provides that the Income-tax Officer may in cases falling under clause (a) at any time within eight years, and in cases falling under clause (b) at any time within four years of the end of that year, serve on the assessee...a notice...and may proceed to assess or re-assess such income, profits or gains... Sub-section (3) of this section, so far as is material, then provides that: (3) No order of...assessment or re-assessment in cases falling within clause (a) of sub-section (1) of this section shall be made after the expiry of eight years, and no order of assessment or re-assessment in any other case shall be made after the expiry of four years, from the end of the year in which the income, profits or gains were first assessable: Provided that where a notice under sub-section (1) has been issued within the time therein limited, the assessment or re-assessment to be made in pursuance of such notice may be made before the expiry of one year from the date of the service of notice even if such period exceeds the period of eight years or four years, as the case may be... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yond doubt by using the word issue in place of the word serve . It must be remembered that between 1922, when the present Act came into force, and 1948, when for the second time section 34 was substantially changed, the obligation on the Income-tax Officer was to serve on and not merely to issue a notice to the person liable to payment. Section 34, so far as is material, originally read thus: 34. If for any reason income, profits or gains chargeable to income-tax has escaped assessment in any year, or has been assessed at too low a rate, the Income-tax Officer may, at any time within one year of the end of that year, serve on the person liable to pay tax on such income, profits or gains,.....a notice.....and may proceed to assess or re-assess such income, profits or gains........ The provisions of this section imposed on an Income-tax Officer who proposed to take action under that section an obligation to serve on the person liable to pay tax a notice within one year of the end of the year in respect of which income had escaped assessment. In 1939 a new section was substituted for the original section 34. Sub-section (1) of the new section provided, inter alia, that t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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