1984 (5) TMI 96

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.... additions on account of low gross profit, cash credit and the value of unaccounted pledged stock. In first appeal, the assessee contended that the assessment was time barred. It was further contended that the additions were unjustified. The first appellate authority upheld the jurisdiction as well as the additions. The assessee is in second appeal. 3. The learned counsel for the assessee repeated the plea that the reassessment was barred by limitation. It is not disputed that during the relevant time there was no statutory time limit for completion of assessments reopened under section 146 of the Income-tax Act, 1961 ('the Act'). It is, however, stated that a circular, viz., Circular No. 10P (V-68), dated 15-10-1968-see Taxmann's Direct T....

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....Board's circular only desired that the ITOs should not keep the reopened assessments pending unduly long. That does not make the assessments made beyond the desirable time limit invalid. As for the statement that variation in bank and book stock was because it is open loan, he pointed out that it was not an open loan as per records. The variation is too large. It was a case of a key loan, according to him. He submitted that the addition on account of discrepancy in stock was well justified. So were the additions for low gross profit and cash credit. 5. We have carefully considered the records as well as the arguments. Order under section 27 of the 1922 Act reopening the assessment was passed on 14-2-1967. The order sheet shows that the cas....

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....reopened under section 146 or which have been set aside in appeal, should normally be completed within a period of 2 years. The period of 2 years will be reckoned from the date on which the Income-tax Officer passes the order accepting the application of the assessee under section 146 to reopen the assessment or from the date of receipt of the appellate order setting aside the assessment. " (Emphasis supplied) In our opinion, the direction of the Board is only to say that the assessments are not unreasonably delayed. Time limit was in respect of normal assessments. It also does not follow that the assessments passed beyond such time-limit as administratively laid down, make the assessments illegal. Though we have no doubt that Board's circ....