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Issues: Whether, for the purpose of reopening an assessment under section 35 of the Tamil Nadu Agricultural Income-tax Act, the period of five years is to be computed from the end of the financial year or from the end of the previous year in which the income was earned.
Analysis: The Act distinguishes between the "previous year", being the year in which income is earned or received, and the "financial year", being the year of assessment. The charging provision makes the tax payable for each financial year on the income of the previous year, and section 35 expressly refers to escaped assessment in any financial year. The limitation for reopening therefore runs from the end of the financial year or assessment year, not from the end of the previous year.
Conclusion: The notice issued within five years from the end of the assessment year was within time, and the Tribunal erred in holding the reopening barred by limitation.
Final Conclusion: The revision succeeded and the reassessment proceedings were held to be legally valid.
Ratio Decidendi: Where the statute uses "financial year" for limitation in reassessment, the period must be computed with reference to the assessment year and not the previous year in which income accrued or was received.
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