{"id":120098,"date":"1970-08-20T00:00:00","date_gmt":"1970-08-19T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/commissioner-of-income-tax-vs-s-raghbir-singh-trust-on-20-august-1970"},"modified":"2015-07-01T16:59:23","modified_gmt":"2015-07-01T11:29:23","slug":"commissioner-of-income-tax-vs-s-raghbir-singh-trust-on-20-august-1970","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/commissioner-of-income-tax-vs-s-raghbir-singh-trust-on-20-august-1970","title":{"rendered":"Commissioner Of Income-Tax, … vs S. Raghbir Singh Trust on 20 August, 1970"},"content":{"rendered":"
Punjab-Haryana High Court<\/div>\n
Commissioner Of Income-Tax, … vs S. Raghbir Singh Trust on 20 August, 1970<\/div>\n
Author: H Singh<\/div>\n
Bench: H Singh, D Mahajan, S Sandhawalia<\/div>\n<\/p>\n
<\/pre>\n
JUDGMENT<\/p>\n
  Harbans Singh, C.J.  <\/p>\n
 1. This income-tax reference has been placed before me in view of difference of opinion between Mahajan, J. and Sandhawalia, J..\n<\/p>\n
 2. The relevant facts have been given in considerable detail in the order of Mahajan, J.* ,and it is hardly necessary to repeat them in extenso. The family consisting of S. Raghbir Singh, his sons and his wife disrupted on 10th of April 1953 and the assets of the family were partitioned. Inter alia S. Raghbir Singh received 400 shares of Simbhaoli Sugar Mills Private Limited (hereinafter referred to as ‘the Mills’) and out of these he transferred 300 shares to a trust which was to pay off the debt due to firm R. B. Seth Jessa Ram-Fateh Chand, and thereafter eighty percent of the income of the Trust was to be spent for the education of S. Raghbir Singh’s children and grand children and the balance twenty percent was to be spent on various charitable purposes mentioned in the deed. This Trust  deed thus had come into being during the assessment year 1954-55. For that year two returns were filed by S. Raghbir Singh one was in his individual capacity excluding the income arising from 300 shares in the Mills, and the other was filed by him on behalf of the Trust in his capacity as its President regarding the income of 300 shares which had been transferred by him to the Trust. No assessment was made in the case of return filed on behalf of the Trust, and the Income-tax Officer directed that the income accruing to the so called Trust is to be assessed in the hands of S. B. Raghbir Singh. S. Raghbir Singh in his individual capacity was separately assessed and the income of the 300 shares was also added to his income.\n<\/p>\n
 *(The order of Mahajan, J. is not printed here – Ed.) <\/p>\n
 Having failed before the Assistant Appellate Commissioner and the Income Tax Tribunal, he approached this Court to which two questions were referred. The second question was not answered by the Court, while the first question referred to the Court was as follows:-\n<\/p>\n
 “Whether the dividend income of the 300 shares of the Simbhaoli Sugar Mills Private Ltd., transferred by the assessee to S. Raghbir Singh Trust was the income of the assessee liable to tax ?\n<\/p>\n
 This question was answered in the negative, and the case is reported as S. Raghbir Singh v. Commr. of Income-tax, Simla, (1961) 42 ITR 410 (Punj). An appeal filed by the Department in the Supreme Court was also dismissed, and the judgment of the Supreme Court is reported as Commr. of Income Tax, Punjab, Jammu and Kashmir and Himachal Pradesh, v. S. Raghbir Singh,<\/a> (1965) 57 ITR 408 = (AIR 1966 SC 18)   <\/p>\n
 3.  It appears that after the decision of this Court the Income-Tax Officer, on 19th of September, 1961, issued a notice to the Trust under Section 34(1) (b) of the Indian Income-tax Act, 1922 (hereinafter referred to as ‘the Act’) with a view to assess the income arising out of 300 shares above mentioned in respect of which the Trust had filed its return on 15th of July 1954.  The assessment was completed by the Income-Tax Officer on 23rd of February, 1962. The objection taken on behalf of the Trust that the notice issued, as stated above, beyond the time prescribed in sub-section (1) (b) of S. 34 of the Act, was without jurisdiction, was not accepted by the Income Tax Officer or by the Appellate Assistant Commissioner. The Tribunal however, in appeal preferred by the Trust, accepted this contention and on an application made by the Department the following question was referred to this Court:-\n<\/p>\n
   “Whether on the facts and in the circumstances of the case, the assessment made under Section 34(1) (b) for the assessment year 1954-55 was barred by time and was not saved by the second proviso to Section 34(3) of the Income-tax Act, 1922 ?\n<\/p>\n
 Mahajan, J., came to the conclusion that the decision of the Tribunal was correct and the assessment was barred by time and was not saved by the second proviso to sub-section (3) of S. 34 of the Act. Sandhawalia, J., however took a contrary view, and in these circumstances that the matter has been placed before me.\n<\/p>\n
 4.  The only question involved in the present case is whether the second proviso to sub-section (3) of S. 34 applies to the circumstances of this case. Notice in this case was issued under Section 34 (1)(b)  of the Act on the ground that some income had escaped assessment for the year concerned. This could be done, as provided in this very sub-section, ‘at any time within four years of the end of that year’. Again sub-section (3) provides that no order of assessment in a case like the present after a notice under Section 34(1) (b) can be made ‘after the expiry of four years from the end of the year in which the income profits or gains were first assessable’ . It is, therefore a common case that the notice under Section 343(1)(b) could have been issued within four years of the end of the year in which the income was assessable, in other words, it could have been issued within four years from the end of the assessment year 1954-55. The notice in this case was admittedly long after that. The case of the Department, therefore, is that the second proviso to sub-section (3) was applicable. The relevant part of this proviso is to the following effect:-\n<\/p>\n
   “Provided further that nothing contained in this section limiting the time within which any action may be taken or any order, assessment or reassessment may be made, shall apply to a reassessment…made on the assessee or any person in consequence of or to give effect to any finding or direction contained in an order under S. 66 ….”\n<\/p>\n
 The contention is that in the order passed by the High Court under Section 66 in the case of S. Raghbir Singh, noted above, finding was given that the income from the 300 shares, which was originally assessed as the income of S. Raghbir Singh in his individual capacity was not the income of S. Raghbir Singh but that of the Trust and that it was in consequence of or to give effect to this finding contained in this order under Section 66 that action was taken and order of assessment made; consequently, the limitation of four years was not applicable to the present case.\n<\/p>\n
 5.  Two conditions have to be satisfied before this proviso can apply to a particular case of reassessment viz., (a) that the reassessment should be made ‘on the assessee or any person’, and (b) such a reassessment should be in consequence of or to give effect to any finding contained in an order under Section 66.\n<\/p>\n
 6.  It is now to be examined whether these two conditions are satisfied in the present case.\n<\/p>\n
 7.  In the previous order, in consequence of which action is said to have been taken, the asssessee was S. Raghbir Singh in his individual capacity. The assessee, in the present case is admitted not S. Raghbir Singh, in any capacity whatever. In the present case, the assessee is the Trust. The mere fact that S. Raghbir Singh is one of the four trustees of this Trust or that he filed a return on behalf of the Trust in his capacity as such in the year 1954, would not make any difference. This was not, disputed on behalf of the Department.  The Trust, may however, fall within the meaning of ‘any person’. However, their Lordships of the Supreme Court in S. C. Prashar  v.  Vasantsen Dwarkadas,<\/a> (1963) 49 ITR 1 = (AIR 1963 SC 1356) considered at length the argument put before them that this second proviso so far as it relates to the reassessment of any person other than the assessee, was ultra vires the Constitution and it was held by majority that this proviso was valid so far as the case of “an assessee” is concerned, but it was invalid so far as its application to “any person” is concerned.  At p. 11 (of ITR) = (at p. 1366 of AIR) onwards of the report, S. K. Das., observed as follows:-\n<\/p>\n
 “……….Chagla, C. J., had pointed out rightly in my opinion, that the persons with regard to whom a finding or direction is given and the person with regard to whom no finding or direction is given belong really to the same category namely the category of persons who are liable to pay tax and have failed to pay, it for one reason or another. Admittedly, persons who are liable to pay tax and not have paid it could not be proceeded against after the period of limitation, unless a finding or direction with regard to them was given by some tribunal under various sections mentioned in the proviso, therefore out of the large category of people who were liable to pay tax but failed to pay it, a certain number is selected for action by the proviso and  with regard to that small number the right of limitation given to them is taken away …………. …         …       …          …           …  ……… ……..   … …\n<\/p>\n
 I am in agreement with the view expressed by the learned Chief Justice that no rational basis has been made out for the distinction between the two classes of people referred to above, who really fall in the same category and with regard to whom there was no difficulty in having an uniform provision of law ...  ...      ...      ...      ...   ...        ...  ...      ....... ..........     .........    ...        ...          ...              ..................  ..................... ................. ........ \n\n \n\n The second proviso to subsection 3 of Section 34 ....patently introduced an unequal treatment in respect of some out of the same class of persons. Those whose liability to pay tax was discovered by one method could be proceeded against at any time and no limitation would apply in their case and in the case of others the limitation laid down by sub-section (1) of S. 34 would apply, This in my opinion in unequal treatment which is not based on any rational ground.\"  \n\n \n\n 8.  Desai, J., of the Bombay High Court from where that appeal had been taken to the Supreme Court had put the matter on a somewhat narrower ground, and dealing with the same, S. K. Das, J., observed as follows:- \n\n<\/pre>\n
   “He held that so far as assessees were concerned, there might be a rational ground for distinction because the appeal proceedings, etc might take a long time and the assessee being a party to the appeal could not complain of such delay; therefore assessees did not occupy  the same position as strangers. But the learned Judge held that there was no rational distinction so far as the strangers were concerned, and there was no reason why they should be deprived of the benefit of the time limit prescribed by sub-section (1). He therefore held that the proviso, so far as it affected person other than the assessees not parties to the proceedings enumerated in it, must be held to be ultra vires the legislature.” Even on the basis of this narrower view, the majority of the Supreme Court Judges held that the case was not covered by the proviso.\n<\/p>\n
 9.  The argument of the Department which has been accepted by Sandhwalia, J. was although the Trust was not a party to the previous proceedings, in which the order or the direction had been given, yet S. Raghbir Singh who was the assessee, was so intimately connected with the Trust that the trust should be covered by the word ‘assessee’. For this reliance was placed on certain observations of their Lordships of the Supreme Court in Income-tax Officer, A-Ward, Sitapur  v.  Murlidhar Bhagwan Das, (1964) 52 ITR 335 =  (AIR 1965 SC 342). In that case the respondent-firm was assessed to income-tax under Section 23(4) of the Act for the assessment year 1949-50 on the ground that the notice issued under sub-sections (2) and (4) of the S. 22 of the Act had not been complied with. This assessment was cancelled under Section 27 on 27th of September 1955 but before the said cancellation, it was found that some income received had escaped assessment as the assessee failed to disclose the same. The Income-tax Officer had issued a notice under Section 34(1) (a) of the Act for the relevant assessment year 1949-50 on the ground that the said income amounting to Rs. 88,737\/- had escaped assessment in the said assessment year. After the assessment for that year had been set aside, the Income-tax Officer ignored the aforesaid notice and included the amount in the fresh assessment made by him.\n<\/p>\n
  In appeal the Appellate Assistant Commissioner however held that this income was received in the previous accounting year and deleting the same from the assessment year 1949-50, directed that the same be included in the previous assessment year 1948-49. Pursuant to that direction, a notice was issued under Section 34(1) of the Act and on a petition under Art. 226 of the Constitution the Allahabad High Court held that the proceedings were initiated beyond the time prescribed by Section 34 of the Act and quashed the proceedings, against which the Department filed an appeal to the Supreme Court. In the majority judgment, delivered by Subba Rao, J., (as he then was) it was held first that under the Income-tax Act, year is the unit of assessment and the following observations made by the Judicial Committee in Commr. of Income-tax v. S. M. Chitnavis 59 Ind App., 2900, at p. 297 = (AIR 1932 PC 178 at p. 181) were referred to with approval :-\n<\/p>\n
   “For the purpose of computing the yearly profits and gains, each year is a separate self-contained period of time, in regard to which profits earned or losses sustained before its commencement are irrelevant.”\n<\/p>\n
 Reference was also made to  Kikhabhai Premchand v.  Commr. of Income-tax, (1953) 24 ITR 506 at p. 508 = (AIR 1953 SC 509 at p. 510) where the Supreme Court observed as follows :-\n<\/p>\n
  “…..for income-tax purposes, each year is a self-contained accounting period, and we can only take into consideration income, profits and gains made in that year and are not concerned with potential profits which may be made in another year any more than we are with losses which may occur in the future.”\n<\/p>\n
  Their Lordships then went on to consider the meaning of the words ‘any person’ and ‘any finding or direction’ as used in the proviso. As regards the meaning of the word ‘finding’ it was observed as follows at p. 345 (of ITR) = (at p. 349 of AIR) <\/p>\n
   “A finding therefore can be only that which is necessary for the disposal of an appeal in respect of an assessment of a particular year. The Appellate Assistant Commissioned may hold on the evidence that the income shown by the assessee is not the income for the relevant year and thereby exclude that income from the assessment of the year under appeal. The finding in that context, is that, that income does not belong to the relevant year. He may incidentally find that the income belongs to another year, but that is not a finding necessary for the disposal of an appeal in respect of the year of assessment in question.”\n<\/p>\n
 In view of this it was held that the finding given by the Appellate Assistant Commissioner that the income could not be assessed in the relevant year 1949-50 was the only finding within the meaning of the proviso, and the other finding that this income was properly assessable in the previous year was merely incidental and not a finding within the meaning of the proviso in consequence of which action could be taken without any care for the limitation. This was sufficient, for the disposal of the case. However, their Lordships also dealt with the meaning of the words ‘any person’ and the observations made in this respect are the ones on which great reliance was placed on behalf of the Department.\n<\/p>\n
  I would reproduce the relevant portions of these observations at p. 346 (of ITR) = (at p. 349 of AIR) of the report –\n<\/p>\n
   “The words ‘any person’ it is said, conclude the matter in favour of the department. The expression ‘any person’ in its widest connotation may take in any person, whether connected or not with the assessee, whose income for any year had escaped assessment; but this construction cannot be accepted, for the said expression is necessarily circumscribed by the scope of the subject matter of the appeal or revision, as the case may be, that it is to say, that person must be one who would be liable to be assessed for the whole or part of the income that went into the assessment of the year under appeal or revision. If so construed, we must turn to Section. 31 to ascertain who is that person other than the appealing assessee who can be liable to be assessed for the income of the said assessment year. A combined reading of Section 30(1) and S. 31(3) of the Act indicates the cases where persons other than the appealing assesses might be affected by orders passed by the Appellate Commissioner. Modification or setting aside of assessment made on a firm, joint Hindu undivided family or the individual, as the case may be. In such cases though the latter are not eo nomine parties to the appeal their assessments depend upon the  assessments on the former. The said instances are only illustrative. It is not necessary to pursue the matter further. We would therefore hold that the expression ‘any person’ in the setting in which it appears must be confined to a person intimately connected in the aforesaid sense with the assessments of the year under appeal.”\n<\/p>\n
  There is one thing to be noted that in the above case no reference is made by their Lordships to Prashar’s case, 49 ITR 1 = (AIR 1963 SC 1356) referred to above in which it had definitely been held that the proviso so far as it relates to persons other than the assessee was unconstitutional. Moreover,  on a careful reading of these observations, it is clear that according to their Lordships only those persons were covered by the proviso, even if they were not strictly parties to the appeal or revision who in view of Sections 30(1) and 31(3) would be affected by the order passed by the Appellate Assistant Commissioner. The illustrations given are clearly indicative of the type of persons who would be covered. A firm, a Hindu undivided family, and an association of persons, no doubt are treated as separate entities under the Income-tax Act, but in the case of a firm, the burden of the tax imposed on it has ultimately to be the borne by its partners, and consequently, any order passed by the appellate authority would in any way, affect the partners and in a sense they may be treated as assessees. Again in the case of a Hindu undivided family ultimately, the tax is to be paid by the members of the family, and in the case of an association of persons, by the individual members and therefore in a sense, they may be treated as parties or intimately affected by the result of the appeal.\n<\/p>\n
  In a later case reported as Daffadar Bhagat Singh and Sons  v. Income-tax Officer, A. Ward, Ferozepur<\/a> (1969) 71 ITR 417 =(AIR 1969 SC 340) the Supreme Court had to deal with the case of a partnership firm. The appellant firm filed a return for the assessment year 1952-53 on March 31, 1953 and also applied for its registration under Section 26-A of the Act, the partners of the firm being Bhagat Singh and his 2 sons. The Income-tax Officer refused to register the firm or to assess it as a firm, and treating it as a Hindu undivided family passed an order on 11th of August 1959 allowing registration of the partnership firm and further holding that the business belonged to the firm and consequently its income should be excluded from that of the family, and then directed the Income-tax Officer to assess the income of the business in the hands of the firm. On a notice having been issued under Section 34 of the Act, an objection was taken that the notice was barred by time. On behalf of the Department the provisions of the proviso were pressed into service and the High Court of Punjab on a writ petition following the observations of the Supreme Court in Murlidhar – Bhagwandas’s case, 52 ITR 335 = (AIR 1969 SC 342) held them covered by the proviso.\n<\/p>\n
  Before the Supreme Court two arguments were urged, first that the finding or direction given by the Appellate Assistant Commissioner that the business belonged to the partnership and not the Hindu undivided family and the further direction that the income of the business should be assessed in the hands of the partnership firm were not necessary for the disposal of the appeal, and secondly, that the partnership firm which was being sought to be assessed was distinct from the Hindu undivided family which had gone in appeal. Both these contentions were repelled. With regard to the first, it was observed as follows:-\n<\/p>\n
   “…the assessee filed the return claiming the status of the firm together with an application under Section 26-A for its registration which was disallowed by the Income-tax Officer but was allowed by the Appellate Assistant Commissioner. The substantial issue before the Appellate Assistant Commissioner was one of status of the assessee and he held that it  was a partnership firm and not a Hindu undivided family. This finding was necessary for deciding the appeal before the Appellate Assistant Commissioner and it is not possible to understand how it can be regarded as having been made only incidentally.”\n<\/p>\n
  With regard to the second point, after referring to Murlidhar – Bhagwan Das’s case, 52 ITR 335 = (AIR 1965 SC 342) it was observed :-\n<\/p>\n
  “…it is again not possible to understand how the appellant can be taken out of the category of person or persons intimately connected with the assessment of the year under appeal. The returns as stated before were originally filed by the partnership firm comprising Bhagat Singh and his two sons. The question was of the assessment of the income of the business of the firm. The Income-tax Officer treated the father and the sons as a Hindu undivided family. On appeal, however the Appellate Assistant Commissioner accepted their contention that they formed a partnership firm. It is difficult, in these circumstances, to agree that the appellant was a total stranger to the assessment which was under the appeal before the Appellate Assistant Commissioner and had no intimate connection with the person whose assessment was made by the Income-tax Officer and was set aside in appeal by the Appellate Assistant Commissioner.”\n<\/p>\n
 It has to be borne in mind that the father and two sons were the persons who had filed their return. They had filed the return in their capacity as partners of the firm of which they sought registration. The Income-tax Officer held that the status of the father and the sons was not that of a partnership firm as claimed by them, but was that of a Hindu undivided family, and in appeal their original contention that they formed a partnership was upheld. So that Bhagat Singh and his two sons were the persons who filed the return and they were before the Appellate Assistant Commissioner and their claim was that they occupied the status of a firm and not of a Hindu undivided family before the Income-tax Officer and they were before the appellate authority in their capacity as members of the Hindu undivided family, which they claimed they were not. In fact they were parties to the assessment and could be said to be assessees, as had been observed by Desai, J., of the Bombay High Court in Prashar’s case which approach was also accepted by the Supreme Court. In any case, one thing is clear that neither Murlidhar Bhagwan Das’s case, 52 ITR 335 = (AIR 1965 SC 342) nor Daffadar Bhagat’s Singh’s case. 71 ITR 417 = (AIR 1969 SC 340) runs counter to the decision in Prashar’s case, 49 ITR 1 = (AIR 1963 SC 1356). In fact in Prashar’s case was approved by Grover, J., delivering the judgment of the Court. His Lordship observed as under :-\n<\/p>\n
   “In 49 ITR 1 = (AIR 1963 SC 1356) this Court, by majority, held that the provisions of the second proviso to Section 34(3) in so far as they authorised the assessment or reassessment of any person other than the assessee beyond the period of limitation specified in Section 34 in consequence of or to given effect to a finding or direction given in an appeal, revision or reference arising out of the proceedings in relation to the assessee, violated the provisions of Article 14 of the Constitution and were invalid to that extent.”\n<\/p>\n
 Prashar’s case, 49 ITR 1 = (AIR 1963 SC 1356) was also referred to by the Supreme Court in Commr. of Income-tax, Bihar and Orissa  v.  Sardar Lakhmir Singh,<\/a> (1963) 49 ITR 70 = (AIR 1963 SC 1394).\n<\/p>\n
 10.  On behalf of the Department reliance was also placed on Commr. of Income-Tax, Patiala  v.  Ambala Flour Mills,<\/a> (1970) 2 SCC 96. In that case originally there were three partners namely, Jai Ram Das. Thereafter another partner , Balkrishnan Das severed his connections with the business and then Debi Prasad, the third partner alone carried on the business year. In the assessment year 1950-51, Debi Prasad filed three returns of income in  the status of the firm, in the status of a firm consisting of Jai Ram Das and Debi Prasad. For the assessment year 1951-52 he filed a return in the status of an unregistered firm and for the assessment year 52-53 in the status of a Hindu undivided family. The Income-Tax officer assessed the mills in three years of assessment in the status of an “association of persons”. In appeals filed by Debi Prasad, the Appellate Assistant Commissioner annulled the orders of assessment and remanded the case to the Income-Tax Officer, who assessed the income as income of the family of Debi Prasad. The Tribunal while upholding the order directed deletion of direction of remand. The High Court held that Debi Parshad was not a stranger in respect of the income tax proceedings against Ambala Flour Mills; that the Appellate Assistant Commissioner could give such a direction, with the rider that the assessment against Debi Prasad could only be in the individual capacity and that he appeals filed by Debi Prasad were maintainable in law.\n<\/p>\n
 On appeal by the Commissioner to the Supreme Court, it was held as follows :-\n<\/p>\n
  ” (i) Debi Prasad had submitted the returns and Debi Prasad appealed against the order of assessment. He could in the circumstances of the case, not be called a stranger to the assessment. The income earned by the assessee was assessed to tax as income of an association of persons, of which the finding of the Income-Tax Officer Debi Prasad was a member. In making a direction against Debi Prasad the Tribunal did not exercise his powers qua a stranger to the assessment proceedings.\n<\/p>\n
  (ii) The High Court in exercising advisory jurisdiction was incompetent to amend the order of the Appellate Assistant Commissioner. But on the question referred to the High Court no enquiry into the power of the Appellate Authority Commissioner to make impugned directions was competent. The second question only related to the assessment of the income in the hands of Debi Prasad after annulling the assessment of Ambala Flour Mills. It was not contended before the Tribunal that the income of the Ambala Flour Mills could not be assessed in the hands of the family of Debi Prasad. The competence of the Appellate Authority Commissioner to make the direction was not and could not be referred to the High Court.”\n<\/p>\n
 This is hardly any authority for the proposition that in now being put forward that if a person cannot be treated to be in any way, before the appellate authorities as an assessee, even then he can be covered by the second proviso. In this case the sole question was, the capacity in which Debi Prasad was to be assessed and therefore, he could not be treated as a stranger.\n<\/p>\n
 11.  In the present case, the Trust was an altogether separate entity and in no way connected with S. Raghbir Singh, as an individual, who was an assessee before the Income Tax Officer and who was the appellant in the High Court. The Trust had filed a separate return  and as observed by the Tribunal no protective assessment was made in its case. The mere fact that S. Raghbir Singh was a trustee of the Trust and in that capacity had filed a return of the Trust would not make any difference. The question for determination is whether the Trust can be treated as a stranger to the proceedings before the High Court which were conducted by S. Raghbir Singh in his individual capacity or is the Trust so intimately connected with those proceedings as not to be treated as a stranger but in a way covered by the word “assessee” ? The Trust itself had not been assessed and the litigation was being fought by S. Raghbir Singh, and his sole contention and interest was that the income of the 300 shares should not be added to his income. In those proceedings, the Trust was not a party and therefore, it could not be covered by the second proviso in view of the decision of the Supreme Court in Prasahar’s case, 49 ITR 1 = (AIR 1963 SC 1356) <\/p>\n
 12.  Moreover, as regards the second point, the only finding that was necessary for the decision of the reference to the High Court made at the instance of S. Raghbir Singh was whether the Trust was validly constituted and whether the income of the 300 shares could be treated as the income of S. Raghbir  Singh individually. The other finding as to who should be treated to be the recipient of the income of these 300 shares was merely an incidental finding not necessary at all for the decision of the reference. I am therefore, in agreement with Mahajan, J., that this finding was merely incidental and a not a finding and therefore this would not be a finding within the meaning of the proviso in pursuance of which any action could be taken.\n<\/p>\n
 13.  In view of the above, I find that both the tests which are necessary for bringing the case within the second proviso fail in this case, and agreeing with Mahajan, J., hold that the Tribunal was correct in its decision that the proceedings initiated and the assessment made were barred by time. The question therefore referred to this Court is answered in the affirmative and against the Department. I also agree with Mahajan, J., that there should be no order as to costs.\n<\/p>\n
 14. Answer in the affirmative.<\/p>\n","protected":false},"excerpt":{"rendered":"
Punjab-Haryana High Court Commissioner Of Income-Tax, … vs S. Raghbir Singh Trust on 20 August, 1970 Author: H Singh Bench: H Singh, D Mahajan, S Sandhawalia JUDGMENT Harbans Singh, C.J. 1. This income-tax reference has been placed before me in view of difference of opinion between Mahajan, J. and Sandhawalia, J.. 2. The relevant facts […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,28],"tags":[],"class_list":["post-120098","post","type-post","status-publish","format-standard","hentry","category-high-court","category-punjab-haryana-high-court"],"yoast_head":"\nCommissioner Of Income-Tax, ... vs S. 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