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TMI Blog1960 (3) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... d that assessment was completed on 31-5-1953. Subsequently, on 31-3-1957, an order was passed against Soma-sundaram Mills, Ltd., under Section 23-A of the Act. The date of the general meeting, with reference to which the assessee's divided income must be deemed to have accrued under Section 23-A, was 22-9-1949, which fell within the year of account, for which the assessee was liable to be assessed in the assessment year 1950-51. After an order had been passed on 31-3-1957, under Section 23-A of the Act, proceedings were taken to reopen the assessment of the assessee for the assessment year 1950-51. A notice was issued by the Income Tax Officer under Section 34(1)(b) of the Act, and it was served on the assessee on 14-9-1957. 3. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the learned counsel for the petitioner. The learned counsel for the Department contended alternatively (1) that the period of limitation should be computed from the close of the assessment year, in which the order under Section 23-A was passed, and (2) that no period of limitation was applicable at all, because, independent of Section 34, under the very term of Section 23-A as it stood in the relevant period, the notional dividend income of the assessee could be taken into consideration in computing the assessable income of the assessee. 5. In Spencer v. Income-tax Officer, AIR1957Mad133 , this Court had occasion to go only into the question, what the expression year in Section 34, meant. It was construed as the assessment yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reopen assessment under Section 34 may arise under various circumstances, one of which is an order under Section 23-A. Therefore, that the order under Section 23-A was passed at a given point of time, may have no relevance in determining the period of limitation permissible and prescribed under Section 34(1) of the Act, If, for instance, discovery or information was beyond four years, that would not extend the period of limitation, even as a result of discovery, action under Section 34(1) would be permissible only within the period of limitation prescribed thereunder. 8. Learned counsel for the Department next contended that under the terms of Section 23-A , as it stood in the relevant period, re-assessment could be undertaken witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opposed to the scheme of the Income Tax Act. At any rate, it is wholly opposed to the scheme of the Income Tax Act, as explained in the decisions of this Court and other Courts. We have no hesitation in rejecting the contention, that the Department had right independent of Section 34 under the term of Section 23-A itself, to re-assess the assessee, shareholder. 9. We are not called upon to consider in this case whether, in the circumstances of this case, the assessment could have been reopened under Section 35. It was brought to our notice that action under Section 35 was contemplated but was dropped. Therefore, we refrain from saying anything about the applicability of Section 35 or about the appropriate period of limitation, had ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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