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TMI Blog1970 (4) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Appellate Assistant Commissioner. But the joint family succeeded in further appeal before the Appellate Tribunal. On October 7, 1959, the Appellate Tribunal upheld the contention of the Hindu undivided family that the two sums of Rs. 14,167 and Rs. 6,912 did not represent income of the undivided Hindu family. Acting on the decision of the Appellate Tribunal, the Income-tax Officer issued a notice to Dhiraj Mal under section 34(1)(a) of the Indian Income-tax Act, 1922 (hereafter referred to as " the Act "), with respect to the assessment year 1950-51. Dhiraj Mal raised an objection that the notice issued under section 34(1)(a) was barred by time. The objection was overruled by the Income--tax Officer. Dhiraj Mal was assessed for 1950-51 on the footing that the sum of Rs. 21,079 represented his undisclosed income. The assessee, however, succeeded in appeal before the Appellate Assistant Commissioner. He held that the reassessment proceedings were barred by time. The department appealed against the decision of the Appellate Assistant Commissioner. The appeal filed, by the department was allowed by the Appellate Tribunal on March 28, 1963. The Tribunal restored the decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 59. Notice under section 34(1)(a) was issued to the assessee on March 2, 1960. That was more than eight years after the expiry of the assessment year 1950-51. So, prima facie, the notice issued to the assessee was barred by time under the first proviso to sub-section (1) of section 34 of the Act. But the department urged that limitation has been saved in the instant case in view of certain provisions contained in section 34. The language of the question framed by the Tribunal is not happy. The substantial question is whether limitation is saved either by sub-section (4) of section 34 of the Act or under the second proviso to sub-section (3) of section 34 of the Act. These two pleas raised on behalf of the department have to be discussed separately. The first plea raised by the department rests on sub-section (4) of section 34 of the Act. In order to bring the present case under subsection (4) of section 34, Mr. Brijlal Gupta appearing for the department relied upon a decision of the Supreme Court in Prashar v. Vasantsen Dwarkadas. In that case it was pointed out that sub-section (4) was inserted in section 34 of the Act by the Income-tax (Amendment) Act, 1959, and the amendment w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of section 34. As regards this proviso, Mr. P. N. Pachauri appearing, for the assessee raised two points. Firstly, he contended that the proviso is unconstitutional. Secondly, he urged that in the instant case there was neither a finding nor a direction as contemplated by the proviso. On the first point, Mr. Pachauri relied upon Prashar v. Vasantsen Dwarkas. In that case it was held by the Supreme Court by majority that the provisions of the second proviso to section 34(3) of the Act of 1922, in so far as they authorise the assessment or reassessment of any person other than the assessee beyond the period of limitation specified in section 34 in consequence of or to give effect to a finding or direction given in an appeal, revision or reference arising out of proceedings in relation to the assessee, violated the provisions of article 14 of the Constitution, and were invalid to that extent. Prashar's case was noticed by the Supreme Court in a later decision of the court Income-tax Officer, Sitapur v. Murlidhar Bhagwan Das. It was observed on page 346 : " The expression 'any person' in its widest connotation may take in any person, whether connected or not with the assessee.. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s found that this was an assessment in consequence of or to give effect to finding or the direction contained in an order under section 33 of the Act. " That observation was made with reference to a decision of this court in Lakshman Prakash v. Commissioner of Income-tax. In the judgment, annexure " D " there is the observation that the Hindu undivided family which was the appellant before the Tribunal and which acted through Dhiraj Mal as the karta put forward the position that the business belonged to Dhiraj Mal as partner in his individual capacity. It was this case that was accepted by the Tribunal. If this were the only material on the record, there might be some force in Mr. Brij Lal Gupta's suggestion that the Tribunal did record a finding on October 7, 1959, against Dhiraj Mal. But a copy of the judgment dated October 7, 1959, is also on the record. The Tribunal made that copy as annexure " A " to the statement of the case. Annexure " A " thus forms part of the statement of the case. The court is entitled to pursue the judgment dated October 7, 1959, on the question whether that decision contains a finding against Dhiraj Mal or not. The judgment itself is the best evidenc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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