LexESTATE OF LATE RANGALAL JAJODIA versus COMMISSIONER OF INCOME-TAX, MADRAS
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A B c D E F G ESTATE OF LATE RANGALAL JAJODIA v. COMMISSIONER OF INCOME-TAX, MADRAS November 19, 1970 897 [.J •. c. SHAH, G. K. MITTER, K. s. HEGDE, A. N. GROVER. AND A. N. RAY, JJ.] Income-tu Act, 1~22, ss. 34(3) 2.nd Proviso and 248-Ass•ss11 dying IMf<WI compllllon of assusm1nt-Assessm1nt complet1d by l.T.O. ott OIHll#s legal repr~s•ntatlv•s Including dlllnherlt•d son-A.A.C. slltlntr alld1 OIHmntnt and directing l.T.O. to make fresh assusment on execu- tors under asseuu's will-Case wheMer covered by s. 34(3) 211d proviso for purpo.re of extending 1imitatlo1>-Proc1dure for 're-assessment-App/I. C'ability of a. 248. R 11led bis income-tax and excess profits tax returns before the Jncome- tax Oftlcer/Ex.cess Profits Tax Officer for the assessment years 1942-43 and 11)43-44 and the corresponding chargeable ·accountiilg periods. He complied with the statutory notices issued to him by ·the said Revenue Offic:u but died before the assessments could be made. He was survived by A.· his second wife, his children by her, and by S, his son by a pre- clece•sed wi'fe. In his will A and another person B were named as execu- tors and S was disinherited. S performed the obsequies at the funeral of R and On this information the Revenue Officer gave notice to S asking him to show cause why assessment should not be made on him as the le~ representative of R. · It was objected by S that he was not legal represen- tative, but he failed to produce a copy of the will. The Revenue Officer thereupon completed the assessments on the estate cJf R by his legal heirs and representatives among whom he included S, A and her children. On appeal by S the Appellate Assistant Commissioner, before whom a copy of the wilt was produced, set aside the assessments and directed the Revenue Officer to make fresh assessment on the executors in accordance with s. 24B of the Income-tax Act, 19.22. Pursuant to the direction the Revenue Officer issued notice to the executors. R's widow A accepted the · notice and requested the Revenue Officer to issue the copies of the record to enable her to make representation. The Revenue Officer held that it was not necessary to go through the formalities again. He completed the assessmen~ on 29th October 1952 more than four years after the end df the assessments years 1942-43 & 1943-44 respectively. In appeal by A the. Appellate Assistant Commissioner held that the assessments were valid· If made on a valid direction by the previoin Appellate Assistant Commis- llloner. He however set aside the assessments and directed the Revenue Oftlcer to complete them after- giving the executrix a fresh opportunity to object to the assessment. The Tribunal upheld the order of the Appellate Assistant Commi••ioner. In reference the High Court held that the first assessment having been made On S who was not a legal representative, the direction given by the Al>llellate Assistant Commissioner was outside the scope of s. 34(3) of the--Act. The High Court also gave a finding that s. 24B was applicable to the proceeding.'! but that in the present case the section had nQ_t been complied with inasmuch as the p-rocedure for making assessment had not been followed de novo. Jn appeals before this Court filed by the Revenue as well 88 by A the questions that fell for considera- tion were: (i) whether s. 34(3) 2nd proviso saved the assessments in the 808 SUPRBMB COUIT ltl!POl.TS [1971) 2 S.C.R. present case from the bar of limitation and (ii) whether s. 24B applied to A the case. HELD: (i) The second proviso to s. 34(3) of the Act applied to the present appeals because, first, the proceedings against R commenced iin filing of returns before the Income-tax authorities; secondly, the. asoess- ment prQCeedings continued after th' death· of R against. the legal repre- sentatives S and A; thirdly, the asoe'8ment proceedings on being set aside B and not cancelled . pursuant to the a~al filed by S on the ground that notice was not given to A were continued and fourthly, the setting aside of the assessment was only on the ground ·that notice was not given to A and therefore the finding and direction was vital to the assessment pro- ceedings. 1be High Court was in error in holding that the assessments were barred by limitation. [81S C-Dl Income-tax Officer, Sitapur v. Murlidhar Bhagwanda.•, S2 I.t.R. 33S C and S. C. Prarhad & Anr. v. Vasantun Dwarkadas ·& Ors. 49. l.T.R. 1, distinguishe
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