Limitation in reassessment proceedings: delayed service and unexplained gaps led to quashing of the demand notice and order.

A challenge to a reassessment was based on alleged breach of the statutory limitation period, focusing on the gap between the reassessment order, service of the demand notice, and the assessee's receipt of the order copy. In the absence of any explanation for the long delay, the tribunal treated the delayed service and communication as supporting a presumption that the reassessment was not made within the prescribed period. The statutory requirement of timely issuance and service was therefore not treated as complied with, and the reassessment order and notice in form VII were quashed as bad in law.

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Issues: Whether the reassessment order and the notice in form VII were liable to be quashed on the ground that they were issued and served beyond the statutory period of limitation.

Analysis: The challenge centred on the delay between the date of the reassessment order, the date of service of the demand notice, and the date on which the assessee obtained a copy of the order. In the absence of any explanation for the long interval, the delay in service and communication of the order gave rise to a presumption that the reassessment was not made within the prescribed limitation period. The statutory requirement of timely issuance and service was not treated as having been complied with.

Conclusion: The reassessment order and the notice in form VII were held to be bad in law and were quashed.

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