Limitation for block assessment under section 158BD runs from service of notice; a delayed assessment is time-barred.

Under section 158BE(2)(a), limitation for a block assessment on an "other person" under section 158BD runs from the end of the month in which the notice is served. The notice issued on 8-7-1996 was treated as the operative section 158BD notice, and the later letter of 9-8-1996 was only clarificatory, so the assessment had to be completed by 31-7-1997. As it was completed on 27-8-1997, it was time-barred. The defect was not a curable irregularity, and section 292B could not validate an assessment barred by limitation.

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Issues: Whether the block assessment under section 158BD was barred by limitation by reason of the date on which notice was served, and whether the defect in the notice could be cured under section 292B.

Analysis: The limitation under section 158BE(2)(a) for an other person referred to in section 158BD runs from the end of the month in which the notice under the chapter is served. The notice originally issued on 8-7-1996 was treated by the Assessing Officer himself as a notice under section 158BD, and the subsequent letter dated 9-8-1996 was only clarificatory and not an independent fresh notice. On that basis, the starting point of limitation was 8-7-1996, so the assessment had to be completed by 31-7-1997. As the assessment was completed only on 27-8-1997, it was time-barred. The defect was held not to be a mere curable irregularity and section 292B could not save an assessment that was barred by limitation.

Conclusion: The block assessment was invalid and void for limitation, and the assessee's objection succeeded.

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