Composite assessment orders cannot cover multiple tax periods where separate yearly proceedings are required; orders were set aside.

A single composite assessment order covering more than one tax period was held unsustainable where separate assessment proceedings were required for each assessment year after the annual return stage. The Court followed the Division Bench view that one show-cause notice or one composite assessment order cannot validly relate to multiple tax periods. The composite assessment objection was accepted, and the assessment and appellate orders were set aside, with liberty to initiate fresh proceedings separately for each assessment year. Other grounds were left open.

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Issues: Whether a single composite assessment order could be sustained when the assessment was treated as covering more than one tax period and whether the impugned assessment and appellate orders were liable to be set aside on that ground.

Analysis: The challenge was confined to the objection that the assessment order was composite. The Court relied on the Division Bench view that a single show-cause notice or a single composite assessment order cannot be passed in relation to more than one tax period, and that separate proceedings are required for each assessment year where the annual return stage has been reached. Other grounds were left open.

Conclusion: The composite assessment objection was accepted, and the impugned assessment and appellate orders were set aside with liberty to the respondents to commence fresh proceedings separately for each assessment year.

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