G D GOPAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE common question referred to us in these two TCs is as follows:

(2.) THE following factual circumstances would highlight the controversy. It will be seen that section 263 of the Income Tax Act provided a limitation of 2 years from the date of the passing of the order for revising that order under that section. The amendment which was made by section 47 of the Taxation Laws (Amendment) Act, 1984 provides now that the said limitation would stand extended and the limitation of the two years would start not from the date of the passing of the orders but from the last date of the relevant financial year. The amendment is to be found in the following words : The amended section 263(2) runs as under :

(3.) WHEN the revision was taken up, it was pleaded before the Commissioner that the action was barred by limitation as the period of two years allowed under the Income Tax Act had already expired. It was pointed out that since the assessments of two years were made on 21 -12 -1982, the action under section 263 of the Act could be taken only upto 31 -12 -1984, whereas the action in this case was taken in March 1985. The Commissioner negatived these contentions on limitation and held that by virtue of the Taxation Laws (Amendment) Act, 1984, the period of limitation stood extended upto the expiry of two years from the end of financial year in which the assessment order was passed, which order was sought to be revised. He has found on merits against the assessee in his order. But we are not concerned with the merits in these cases as the learned counsel for the assessee has restricted his argument only to the limitation aspect. The matter was taken up before the Tribunal and the Tribunal by its order impugned came to the conclusion that the exercise and the action under section 263 of the Act ordered by the Commissioner were in order and could not be said to be beyond the limitation. It is only on the basis of this that ultimately the question came to be referred to us.