Pending reassessment proceedings survive limitation defects and can bar a fresh notice under the successor income-tax law.

Reassessment proceedings initiated under section 34(1)(a) of the Indian Income-tax Act, 1922 were treated as pending on the commencement of the Income-tax Act, 1961 for purposes of the saving clause. A proceeding does not cease to be pending merely because the initiating notice is later found to be time-barred or otherwise unable to yield relief; limitation affects the remedy, not the existence of the proceeding. As the earlier reassessment had been validly initiated by a competent authority and remained pending when the 1961 Act came into force, a fresh notice under section 148 could not be issued.

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Issues: Whether reassessment proceedings initiated under section 34(1)(a) of the Indian Income-tax Act, 1922 were pending on the commencement of the Income-tax Act, 1961 so as to bar a fresh notice under section 148 of the 1961 Act.

Analysis: The relevant saving provision required only the factual pendency of proceedings under the repealed Act. A proceeding does not cease to be pending merely because the notice initiating it was later found to be barred by limitation or otherwise incapable of yielding relief. Limitation affects the remedy and not the existence of the proceeding for the purpose of the saving clause. The earlier proceedings had in fact been initiated by a competent authority and were still pending when the new Act came into force.

Conclusion: The earlier reassessment proceedings were pending at the commencement of the 1961 Act, and the Income-tax Officer was not competent to issue a fresh notice under section 148.

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