Strict limitation under successor-incumbent provisions bars delayed block assessment where no prior hearing occurred.

In block assessment proceedings, section 158BE limitation was held not to be extended by section 129 merely because of a change of incumbent. Section 129 applies only where a proceeding already heard by one authority is taken over by a successor, giving the assessee a right to seek reopening or rehearing before the order is made. As no hearing had occurred before the new incumbent took charge, the statutory basis for extending time by 60 days was absent. The Tribunal also could not sustain an assessment completed beyond limitation on the ground of bona fide mistake, since limitation under the Act cannot be relaxed on equitable considerations. The assessment was therefore barred by limitation.

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Issues: Whether, in block assessment proceedings, the limitation under section 158BE of the Income-tax Act, 1961 stood extended by section 129 on account of change of incumbent, and whether the Tribunal could sustain an assessment completed beyond limitation by treating the delay as a bona fide mistake.

Analysis: The assessment became time-barred unless the statutory condition for invoking section 129 was satisfied. Section 129 applies only where proceedings already heard by one authority are continued by a successor, in which event the assessee may seek reopening of the earlier proceedings or rehearing before the order is passed. On the facts found, no hearing had taken place before the new incumbent took charge, so there was no prior proceeding to reopen and no occasion for a demand of rehearing. In those circumstances, the proviso extending time up to 60 days could not be invoked. The Tribunal also had no power under the Act to ignore the period of limitation on the ground that the delay was a bona fide mistake.

Conclusion: The assessment was barred by limitation, section 129 did not extend the time, and the Tribunal's view sustaining the delayed assessment was unsustainable; the assessee succeeded.

Ratio Decidendi: Section 129 can extend limitation in successor-incumbent cases only when there had been prior hearing and the assessee is entitled to seek reopening or rehearing; absent that condition, the statutory limitation must be strictly enforced and cannot be relaxed on equitable grounds.

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