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<h1>Court affirms trial judge's decision, dismissing appeal with costs. Notice for 1944-45 not based on earlier order.</h1> The court upheld the trial judge's decision and dismissed the appeal with costs, affirming that the notice issued for the assessment year 1944-45 was not ... - Issues:Challenge to notice under section 34 of the Income Tax Act for assessment year 1944-45 based on the second proviso to section 34, sub-section (3).Analysis:The judgment pertains to an appeal against a notice issued under section 34 of the Income Tax Act for the assessment year 1944-45, seeking to include two deposits as income from undisclosed sources. The Appellate Assistant Commissioner had earlier allowed an appeal, stating that the deposits were not income for the assessment year 1945-46. The central issue was whether the notice for the subsequent assessment year was valid under the second proviso to section 34, sub-section (3) of the Income Tax Act.The second proviso to section 34, sub-section (3) saves from limitation any action taken 'in consequence of or to give effect to any finding or direction' in an order under section 31, i.e., an order by an Appellate Assistant Commissioner in appeal. The court analyzed the order of the Appellate Assistant Commissioner and found that there was no finding or direction necessitating the issuance of the notice for the assessment year 1944-45. The Appellate Assistant Commissioner had merely stated that if the deposits were income at all, they could be assessed for the tax year 1944-45, without making a definitive finding to that effect.The court rejected the argument that the Appellate Assistant Commissioner's reference to a previous decision implied a finding for the assessment year 1944-45. It was clarified that the Appellate Assistant Commissioner's focus was solely on determining if the deposits were income for the year 1945-46. Additionally, the Appellate Assistant Commissioner had noted the lack of facts connecting the deposits to the assessee's business, indicating that he was not considering the deposits as income for the year 1944-45. Consequently, the court upheld the trial judge's decision and dismissed the appeal with costs.In conclusion, the court affirmed that the notice issued for the assessment year 1944-45 was not in consequence of any finding or direction in the Appellate Assistant Commissioner's order for the previous year. Therefore, the court upheld the trial judge's decision restraining the continuation of assessment proceedings for the subsequent year.
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