GOVIND DAS Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) These five appeals by special leave raise a short but interesting question of law relating to the applicability of Section 171, sub-section (6) of the Income Tax Act, 1961 (hereinafter referred to as the new Act). The facts giving rise to these appeals are few and may be briefly stated as follows:

(2.) When the Hindu Undivided Family was sought to be assessed for the assessment year 1957-58, for which the relevant previous year was Samvat year commencing from 16th November, 1955, a claim was made on behalf of the members of the Hindu Undivided Family that they had effected a partial partition of their movable properties on 15th November, 1955. This claim was accepted by the Income Tax Officer after due inquiry and a finding was recorded by him in the order of assessment that there was a partial partition of the movable properties of the Hindu Undivided Family on 15th November, 1955. The result was that from and after the assessment year 1957-58 no part of the income of the Export Firm or the Mining Firm was included in the assessment of the Hindu Undivided Family.

(3.) Now it appears that the assessments of the Export Firm and the Mining Firm relating to the assessment years 1950-51 to 1956-57 were reopened after the new Act came into force and reassessments were made enhancing the assessable income of the two firms in accordance with the procedure provided in the new Act. Consequent upon the reassessments of the income of the two firms for the assessment years 1950-51 to 1956-57, notices were issued to the Hindu Undivided Family for reassessments of its income for those years, since the Hindu Undivided Family was a partner in these two firms during those years. The Income-tax Officer, after following the requisite procedure, passed an order of reassessment dated 26th March, 1970 for each of the assessment years 1950-51 to 1956-57 enhancing the assessable income of the Hindu Undivided Family. The appeals filed by the two firms against the orders of reassessment made on them partially succeeded before the Appellate Assistant Commissioner and consequently, orders were passed by the Income Tax Officer on 25th March, 1971 rectifying the orders of reassessment dated 26th March, 1970 made against the Hindu Undivided Family. The two firms obtained some further relief as a result of appeals filed by them before the Tribunal and in consequence, further rectification orders dated 3rd September, 1974 were passed by the Income Tax Officer rectifying the reassessments of the Hindu Undivided Family. The net effect of these orders of rectification passed by the Income Tax Officer was that ultimately a much larger amount of tax was determined as payable by the Hindu Undivided Family than what was found due when the original assessments were made for the assessment years 1950-51 to 1956-57.