9911796707
TMI Blog1967 (3) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee ", claimed that he had deposited Rs. 10,000 with Ramnathan Chettiar out of Rs. 16,000 brought by him when he returned to India from Malaya on March 21, 1946. The Income-tax Officer started proceedings against the assessee for assessment of tax under section 34 of the Income-tax Act for the assessment year 1947-48, and brought to tax Rs. 16,000 as income from undisclosed sources. In appeal, the Appellate Assistant Commissioner modified the order and held that Rs. 10,000 deposited with Ramnathan Chettiar alone were taxable in the year of assessment 1947-48. In the course of his order dated November 25, 1957, he observed : " If there was a sum of Rs. 6,000 it could only be treated as income arising in the 'previous year' for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee...... Proviso (2) to section 34(3) enacts an exception to that provision (sub-section (1) to section 34) and it enables a reassessment to be made in such cases, if it arises in consequence of, or to give effect to, any finding or direction contained in an order under section 31, section 33, section 33A, section 33B, section 66 or section 66A. A plain reading of the section would show that the Income-tax Officer can commence proceedings if there had been a finding by the authority concerned under any one of the sections mentioned above." In our judgment, the High Court was in error in holding that a finding or direction by an appellate authority in an order relating to assessment of one year may warrant the avoidance of the bar of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee was not the income for the relevant year and thereby exclude that income from the assessment of the year under appeal. The finding in that context is that the income did not belong to the relevant year. He may incidentally find that the income belonged to another year, but that is not a finding necessary for, the disposal of an appeal in respect of the year of assessment in question. Counsel for the Commissioner contends that the principle of Murlidhar Bhagwan Das's case does not govern the present case, because in that case proceedings for assessment were commenced in consequence of or to give effect to an express direction of the Appellate Assistant Commissioner, and it was held by this court that a direction not necessary for the di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction which the appellate or revisional authority, as the case may be, is empowered to give under the sections mentioned therein." It is clear from the observations made by this court that a finding within the second proviso to section 34(3) must be necessary for giving relief in respect of the assessment of the year in question. The court in that case expressly lent approval to the observations of the Allahabad High Court in Pt. Hazari Lal v. Income-tax Officer, Kanpur that the word " finding " only covers " material questions which arise in a particular case for decision by the authority hearing the case or the appeal which, being necessary for passing the final order or giving the final decision in the appeal, has been the subject of c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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