Limitation for fresh notice and rehearing by successor Income-tax Officer accepted in favour of the assessee.

Limitation could exclude the period between issue of a fresh notice and the fixed hearing date, and the exclusion was accepted in favour of the assessee. The Tribunal also took the view that a successor Income-tax Officer was not required to reopen the proceeding or grant a rehearing unless the assessee specifically sought one, and that the factual finding that no such request was made remained unchallenged on reliable material. The Revenue's reliance on alleged cash credits and investments was rejected because those facts were not recorded in the assessment order and did not form the basis of the appellate finding.

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Issues: Whether the period between the issue of the fresh notice and the date fixed for hearing was to be excluded in computing limitation, and whether the successor Income-tax Officer was bound to reopen or rehear the matter in the absence of a request by the assessee.

Analysis: The reference was treated as governed by the same legal position as the earlier connected decision for the same assessee and assessment context. The Tribunal had rejected the Revenue's contention based on alleged unexplained cash credits and investments because those facts were not recorded in the assessment order and had not been the basis of the appellate finding. On the limitation question, the Tribunal found that the successor Income-tax Officer was under no obligation to reopen the proceeding or grant a rehearing unless the assessee made such a demand, and that there was no reliable challenge to the factual finding that no such request was made. The factual finding regarding the alleged hearing entry was also left undisturbed.

Conclusion: The question was answered in the affirmative, and the exclusion of the relevant period was accepted in favour of the assessee.

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