AGARWAL BROTHERS Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THE petitioner is a partnership firm consisting of four partners. It carries on business in gold and silver ornaments.

(2.) FOR the assessment year 1953-54, the Income-tax. Officer assessed the petitioner on an income of Rs. 10,303 by an assessment order dated July 29, 1953. It is alleged that the petitioner-firm was dissolved in 1959. Subsequently, a notice dated June 26, 1965, under Section 148 of the Income-tax Act, 1961, was served on Murari Lal, a former partner of the firm. The Income-tax Officer made an assessment order dated March 10, 1969, under Section 147 of the Act of 1961, computing the total income at Rs. 71,072. Aggrieved by the assessment order the petitioner has filed this petition under Article 226 of the Constitution.

(3.) IT is now settled law that Section 297(2)(a)(ii) of the Income-tax Act, 1961, enables the application of that Act to those cases only where the period of limitation for taking proceedings under Section 34 of the Income-tax Act, 1922, has not expired : see J.P. Jani, Income-tax, Officer, Ahmedabad v. Induprasad Devskankar Bhatt, [1969] 72 I.T.R. 595 (S.C.) and Sardar Inder Singh v. Income-tax Officer, C. Ward, Varanasi, 1969 72 ITR 349 All.. The question then is whether the period of limitation for taking reassessment proceedings had already expired before the Act of 1961 came into force. That will depend on whether the amount of concealed income, according to the reasons recorded by the Income-tax Officer, exceeded Rs. 1,00,000.