Limitation for reassessment cannot be revived by a later statute unless revival is clearly provided.

A reassessment power that had already become barred under the Income-tax Act, 1922 was not revived by the Income-tax Act, 1961. The escaped income was below one lakh of rupees, so the limitation under the proviso to Section 34 of the 1922 Act expired on 31 March 1957. Although the Section 148 notice under the 1961 Act was issued within Section 149's outer limit, Section 297 was held to be only a repeal-and-savings provision and not a source of revival. The notice was therefore quashed as time-barred.

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Issues: Whether reassessment proceedings for the assessment year 1948-49 were barred by limitation under the Indian Income-tax Act, 1922, and whether such a time-barred proceeding could be revived and initiated under the Income-tax Act, 1961.

Analysis: The escaped income alleged to have been assessable was below one lakh of rupees, so the limitation under the proviso to Section 34 of the Income-tax Act, 1922 governed the case and the period expired on 31 March 1957. The notice under Section 148 of the Income-tax Act, 1961 was issued within the outer limit prescribed by Section 149 of the Income-tax Act, 1961, but the Court held that Section 297 of the Income-tax Act, 1961 is only a repeal-and-savings provision and does not, either expressly or by necessary implication, revive reassessment proceedings that had already become barred under the repealed Act. A statute enlarging the time for reassessment cannot, in the absence of clear language, revive a right that had already been extinguished by limitation.

Conclusion: The reassessment notice was barred by limitation under the Income-tax Act, 1922 and could not be sustained under the Income-tax Act, 1961; the notice was quashed in favour of the assessee.

Final Conclusion: The Court protected the assessee from a time-barred reopening of assessment and held that the new Act did not revive a reassessment liability already extinguished under the old Act.

Ratio Decidendi: A time-barred power to reopen an assessment under the repealed income-tax law is not revived by a later enactment unless the later statute clearly so provides, expressly or by necessary implication.

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