1990 (8) TMI 67

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....Act, on January 28, 1972, that is, beyond a period of four years from the end of the assessment year, is valid in law ?" The assessee is a company and the proceedings relate to its surtax assessment for the assessment year 1965-66, previous year being from July 1, 1963, to June 30, 1964. The income-tax assessment for the year was completed on August 20, 1970. The surtax assessment has been completed on January 28, 1972, though the return of income under the Surtax Act was filed on September 14, 1965. The assessee filed an appeal against the order of surtax assessment on certain points and succeeded in part. It went in further appeal to the Tribunal on certain other points on which it succeeded. However, the additional ground taken by ....

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....tax Act. Section 18, whereby a number of sections of the Income-tax Act are made applicable to the Surtax proceedings, does not include section 153. Section 153 is the section in the Income-tax Act which provides the time-limit within which the assessments under the Income-tax Act are to be completed. In any event, the income-tax assessment having been completed on August 20, 1970, the surtax assessment completed on January 28, 1972, was within reasonable time. In support, he also relied on the Madhya Pradesh High Court decision in Gwalior Rayon Silk Mfg. (Wvg.) Co. v. CIT [1982] 134 ITR 318 and the Madras High Court decision in Vijaya Production Pvt. Ltd. v. CIT [1980] 122 ITR 136. Section 5 of the Surtax Act corresponds to section 139 ....

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....ed within four years. Since the assessee had not filed the returns, the case was held as falling under section 14 and, therefore, the notice issued within four years was held valid. In the other two decisions in Bharat Steel Tubes Ltd. v. State of Haryana [1988] 70 STC 122 and State of Gujarat v. Patel Raghav Nath, AIR 1969 SC 1297, the Supreme Court has not imported any time-limit where no time limit was prescribed for completion of assessment. What is held is that the assessment even in such cases must be made within reasonable time. What will constitute reasonable time will depend upon the nature of the order and the facts of the case. Thus, these decisions do not support the contention raised on behalf of the assessee. The Madhya Pra....