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Issues Involved:
1. Construction of section 33B of the Income-tax Act. 2. Validity of the Commissioner's order under section 33B(1) made beyond the period of two years. 3. Applicability of the limitation period under section 33B(2)(b). Detailed Analysis: 1. Construction of Section 33B of the Income-tax Act: The case revolves around interpreting section 33B of the Income-tax Act. The Commissioner of Income-tax revised an order under section 33B(1), which was contested by the assessee. The Tribunal found that the assessee was not given sufficient opportunity to be heard, as required by section 33B. Consequently, the Tribunal set aside the Commissioner's order and remanded the case for further inquiry. The Commissioner, after examining the evidence, passed a second order, which was also contested on the grounds of being beyond the two-year limitation period specified in section 33B(2)(b). 2. Validity of the Commissioner's Order under Section 33B(1) Made Beyond the Period of Two Years: The Tribunal held that the second order by the Commissioner was invalid as it was made beyond the two-year limitation period from the date of the original order sought to be revised. The Tribunal observed that there was a lacuna in the Act, as it did not provide for an extension of the limitation period under section 33B(1) in such circumstances. The Tribunal stated, "The Tribunal having set aside the order of the Commissioner of Income-tax made it impossible for him to overcome the provisions of section 33B(2)(b) when he came to make a fresh order under section 33B(1) of the Act." 3. Applicability of the Limitation Period Under Section 33B(2)(b): The primary argument by the Revenue was that the limitation period should apply only to the first order made by the Commissioner and not to any subsequent orders made in compliance with directions from higher authorities. The Tribunal, however, did not accept this argument, stating, "The language of the sub-section does not, in our opinion, readily accord with this construction." The Tribunal emphasized that the provision must be interpreted literally, and the limitation period applies to any order made under section 33B, whether made suo motu or after remand by a higher authority. The Tribunal also considered an alternative argument that the literal interpretation of the limitation period would lead to absurdity, as it would prevent the Commissioner from carrying out directions from higher authorities if the two-year period had expired. The Tribunal concluded that the absence of a proviso similar to section 34(3) in section 33B(2) should not affect the legal position. The Tribunal stated, "Where the main object and the intention is clear, it must not be reduced to a nullity by the draftsman's unskilfulness." Conclusion: The Tribunal concluded that the limitation period prescribed in section 33B(2)(b) does not apply to orders passed by the Commissioner in compliance with directions from higher authorities. The question framed was answered in the negative, indicating that the limitation period does not restrict the Commissioner from making orders beyond two years if acting on directions from higher authorities. The assessee was ordered to pay the costs, with no order as to the costs of the notice of motion.
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