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Issues:
1. Assessment year 1981-82: Whether the assessment was made after the expiry of the period of limitation prescribed by section 153? 2. Assessment year 1982-83: Whether the interest on fixed deposit amounting to Rs. 2,69,338 accrued during the year under appeal and if its inclusion in the total income was proper? Analysis: 1. For the assessment year 1981-82, the issue revolved around the interpretation of clause (iv) of Explanation 1 to section 153 of the Income-tax Act, 1961. The assessee contended that the assessment made on September 25, 1984, exceeded the period of limitation prescribed by section 153. The Tribunal upheld the Commissioner of Income-tax (Appeals) order, stating that the extension of limitation by 180 days under Explanation 1(iv) applies, provided it does not exceed 180 days. The High Court analyzed the provisions of Explanation 1(iv) and concluded that the assessment made on September 25, 1984, was within the extended period and, therefore, in time. The Court rejected the assessee's contentions, ruling against the assessee on this issue. 2. Regarding the assessment year 1982-83, the question was whether the interest on a fixed deposit amounting to Rs. 2,69,338 accrued during the relevant year and if its inclusion in the total income was justified. The Assessing Officer included the interest in the total income, but the Tribunal held that the amount did not accrue during the year under appeal. The High Court examined the directions of the court regarding the fixed deposit and interest, concluding that the assessee had no enforceable right to receive the interest. Citing relevant case law, the Court affirmed the Tribunal's decision that the interest did not accrue during the relevant year. Consequently, the inclusion of the interest in the total income was deemed improper, and the Court ruled in favor of the assessee on this issue. In conclusion, the High Court ruled against the assessee for the assessment year 1981-82, stating that the assessment was made within the extended period of limitation. However, for the assessment year 1982-83, the Court sided with the assessee, determining that the interest on the fixed deposit did not accrue during the relevant year, and its inclusion in the total income was not justified.
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