TMI Blog1994 (12) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... in this reference are 1965-66, 1966-67, 1967-68, 1969-70 and 1970-71. The assessments for all these five years were originally completed accepting the statement of the assessee that certain credits shown in its books of account were genuine ' loans borrowed from certain persons whose names were recorded in the said books. Interest paid by the assessee on those loans were also allowed as genuine payments to those creditors. Subsequently, the Income-tax Officer came across certain materials which led him to believe that the income of the assessee, in the original assessments, was under assessed due to the failure of the assessee to disclose truly and fully all material facts necessary for the assessments. He recorded the reasons for forming that belief for each of the years under consideration and reopened the assessments under section 147(a) of the Income-tax Act, 1961 ("the Act"), after obtaining the prior approval of the prescribed authorities wherever necessary, by issue of notices under section 148 of the Act. The material on which the Income-tax Officer formed his belief were certain confessions by the creditors whose names appeared in the books of the assessee. After reopenin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of April, 1968 ; (iii) two years from the end of the assessment year in which the income was first assessable, where such assessment year is an assessment year commencing on or after the 1st day of April, 1969 ; or (b) the expiry of eight years from the end of the assessment year in which the income was first assessable, in a case falling within clause (c) of sub-section (1) of section 271 ; or (c) the expiry of one year from the date of the filing of a return or a revised return under sub-section (4) or sub-section (5) of section 139, whichever is latest. (2) No order of assessment, reassessment or recomputation shall be made under section 147--- (a) where the assessment, reassessment or recomputation is to be made under clause (a) of that section, after the expiry of four years from the end of the assessment year in which the notice under section 148 was served ; (b) where the assessment,, reassessment or recomputation is to be made under clause (b) of that section, after--- (i) the expiry of four years from the end of the assessment year in which the income was first assessable, or (ii) the expiry of one year from the date of service of the notice under sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... end of the assessment year in which the notice under section 148 was served in cases where the assessment or reassessment is made under sub-clause (a) of section 147, wholly redundant, and nugatory. Similarly, clause (e) of section 246 which includes in the list of appealable orders " orders of assessment, reassessment or recomputation under section 147 " would also become redundant because all such orders would be covered by clause (c) itself which refers to "orders of assessment under sub-section (3) of section 143 and section 144 ". The same would be the fate of many other provisions which would be rendered inconsistent with each other, redundant and unworkable. We really wonder who conceived such an argument which deserves no consideration but outright rejection. In that view of the matter, we are of the clear opinion that the orders of reassessment, in the instant case, having been made within the time-limit prescribed by section 153(2) of the Act, are not barred by limitation. However, before parting with the case, it would be appropriate to briefly deal with the argument of learned counsel based on the definition of "assessment" which includes "reassessment" and the effec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77 ITR 526 in support of his contention that the limitation prescribed under section 153(1) applies also to reassessments under section 147. We have gone through the said decision. It appears that arguments similar to those advanced before us were also made in that case before the Madras High Court. The only object of referring to this decision, in our view, possibly, could be to show us that it is not for the first time that such curious arguments are being advanced. Even in the past, courts had to deal with similar contentions. Beyond that, this decision appears to be of no assistance to the assessee because such contentions were repelled by the court in that case. It was held (at pages 530 and 531) : "..... Section 153(1) of the Act refers to assessments under section 143 or 144 of the Act, while section 153(2) of the Act deals with assessments, reassessments or recomputations made under section 147 of the Act. Thus, in section 153 of the Act, two distinct and different situations are provided for with reference to assessments under section 143 or 144 of the Act and assessments or reassessments or recomputations made under section 147(a) or 147(b) of the Act and the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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