TMI Blog1982 (2) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... O ? " The material facts giving rise to this reference briefly are as follows: The assessee is an individual and the assessment years in questionnaire 1969-70 and 1970-71. The return of wealth for these assessment years were due to be filed on or before 30th June, 1969, and 30th June,1970 respectively under s. 14(1)of the Act. The WTO also issued notices u/s. 14(2) of the Act to the assessee for these assessment years, which were served on the assessee on 9th July, 1969, and 2nd July, 1970, requiring the assessee to furnish returns within 30 days of the service of the notice. The assessee, however, filed the returns for these assessment years on 28th February, 1973. As there was delay in filing the returns and as the assessee failed to satisfy that there was reasonable cause for the delay, the WTO imposed penalties u/s. 18(1)(a) of the Act. On appeal, the AAC rejected the contention advanced on behalf of the assessee that there was no proper service of notice issued u/s. 14(2) of the Act. The AAC passed the following order: "Since there was no reasonable cause, I am of the opinion that penalties u/s. 18(1)(a) are rightly attracted for both the assessment, years under appeal f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aphekar, learned counsel for the assessee, contended that as soon as notices u/s. 14(2) of the Act were issued to the assessee, the operation of s. 14(1) of the Act came to an end and no penalty could be imposed for default u/s. 14(1) of the Act. Reliance was placed upon a decision of this court in Addl. CIT v. Rampratap Shankarlal [1979] 117 ITR 662 (MP). The decision in 117 ITR 662 is, however, distinguishable on facts. On behalf of the Department, it was, however, urged that the decision of this court in 117 ITR 662, needs reconsideration. In that case, it was found that the notice issued u/s. 139(2) of the I.T. Act, 1961, was served on the assessee. In the instant case, the finding of the Tribunal is that notices issued u/s. 14(2) of the Act were not served on the assessee. Hence it is not necessary for us in this case to consider as to whether the decision in 117 ITR 662 needs reconsideration. The only question for consideration in this case is whether after issuance of notice u/s. 14(2) of the Act, the operation of s. 14(1) of the Act came to an end with the, result that no action for imposition of penalty can be taken u/s. 18(1)(a) of the Act for default u/s. 14(1) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is no equity about limitation. Most of the decisions relied on relate to provisions which laid down a period of limitation for taking one kind of action or other in order to assess to tax the person concerned. Naturally, after the period of limitation has expired, no proceedings can be taken to assess nor could any period of limitation laid down by the Act be extended merely by a superior tribunal directing an inferior tribunal to make an assessment or to take proceedings which result in assessment after the period of limitation is over. " Learned counsel for the assessee further contended that the statute of limitation was a statute of repose and this salutary principle, which was recognised by s. 18(5) of the Act, would be set at naught if we were to hold that those provisions would not be attracted to an order passed by the WTO, on remand by the Tribunal. To appreciate the contentions advanced on behalf of the assessee, it would be useful to refer to the relevant provisions of sub-s. (5) of s. 18 of the Act, which read as under : " (5) No order imposing a penalty under this section shall be passed (a) in a case where the assessment to which the proceedings for impositi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1974] 97 ITR 525 (Addl. CIT v. K.S.G. Panicker, Kerala Produce Exporting Co.) no doubt supports the contention advanced on behalf of the, assessee. The Kerala High Court in [1974] 97 ITR 525, differed from the view taken by the Bombay High Court in CIT v. Kishoresinh Kalyansinh Solanki [1960] 39 ITR 522, that the period of two years mentioned in s. 33B(2)(b) of the Indian I.T. Act, 1922, would not apply when the Commissioner acted pursuant, to the directions of the Tribunal. However, the view taken by the Bombay High Court in [1960] 39 ITR 522, has been approved by the Supreme Court in CIT v. National Taj Traders [1980] 121 ITR 535. The question that arose , for consideration in that case was whether a direction to dispose of the case afresh could be given to the Commissioner by the Appellate Tribunal when the prescribed period of limitation under sub-s. (2) of s. 33B of the Indian I.T. Act, 1922, had expired. Dealing with this question, the Supreme Court observed that the view taken by the Bombay High Court in [1960] 39 ITR 522, was the correct view. In these circumstances, the view of the Kerala High Court in [1974] 97 ITR 525 (Addl, CIT v. K.S.G. Panicker, Kerala Produce Expor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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