(a) Income Tax Ordinance (XXXI of 1979)---

----S.56---Proceedings relating to past years could be initiated by the Income tax Officer by issuing notice under S.56 of the Ordinance.--1987 PTD (Trib.) 314; ITA No.455 (IB) of 1988-89 and ITAs. Nos:67-74(IB) of 1988-89 and 1990 PTD (Trib.) 260 dissented from.

1990 PTD (Trib.) 260 fol.

1987 PTD (Trib.) 314; ITA No.455 (IB) of 1988-89 and ITAs. Nos.67-74(IB) of 1988-89 and 1990 FM (Trib.) 260 dissented from.

(b) Income Tax Ordinance (XXXI of 1979)---

----S. 56---Income-tax Officer while making assessment or proceedings under S. 56 had violated mandatory requirements of law regarding proper service of notice on the assessee---Effect---Held, any irregularity, error or mistake committed by Income-tax Officer in completing the proceedings would tantamount to an "error in jurisdiction" rather than "error of jurisdiction" in case of which proceedings were not be void but only defective which defect -ordinarily was curable---Duty of Appellate Court in such cases stated.

1992 PTD (Trib.) 1587 and PLD 1963 Lah. 391 ref.

Income Tax Ordinance (XXXI of 1979)---

----Ss. 56, 65 & 166---Proceedings in respect of any assessment year after the coming in force of Income Tax Ordinance, 1979 (assessment year 1979-80) can validly be initiated by a notice under S. 56 of the Ordinance---If after coming into force of the Ordinance an Income-tax Officer intended to initiate proceedings in respect of any assessment year before the assessment year 1979-80 he could do so only in accordance with the provisions of S. 65 of the Ordinance as provided by S. 166(2)(c)(ii) of the .Ordinance---If Assessing Officer having been satisfied that a case fulfilled all the conditions of S. 65 of the Ordinance, requires the assessee through a notice under S.56 of the Ordinance to furnish the return of his income, he would be considered to have initiated the proceedings under S. 65 of the Ordinance.

1990 PTD (Trib.) 260 ref.

(d) Income Tax Ordinance (XXXI of 1979)--

----Ss. 65 & 56---Interpretation of S.65----Where an Assessing Officer, after being satisfied that all the conditions for initiating the proceedings under S.65 exist in a particular case, requires an. assessee through a notice under S. 56 of the Ordinance to furnish the return of his income, the issuance of the notice under S.56 will be deemed to be a notice issued in pursuance of and in accordance with the provisions of S.65(1) and after adopting such course by the Assessing Officer, there will be no "error in jurisdiction".

The bare reading of the bare language of section 65 would show that the section in itself is not a such provision laying down the procedure by which the assessement for any assessment year required to be made in accordance with it shall be made. Section 65 only contains substantive provisions empowering an Income-tax Officer to make assessment in respect of any previous year and specified certain conditions subject to which the assessing officer shall exercise that power. The conditions can be categorised in two classes. Conditions in the first class are those which must exist before an I.T.O initiates the proceedings and invites or asks the assessee to show cause why an assessment on his income should not be made and the conditions in the second class are such requirements as the I.T.O. making the assessment should comply with after he has initiated the proceedings. The conditions in the first class are:

(i) that the I.T.O. has come into possession of definite information regarding the escapement of the total or partial income of an assessee from the assessment and

(ii) the assessment year in which any income has escaped assessment is within 10 years.

There is only one condition/requirement in the second class and that is the assessment in respect of any assessment year shall be made before the expiration of one year from the end of the financial year in which the proceedings were initiated. After the conditions in the first class have been fulfilled the assessing officer shall require the assessee to furnish the return of his income in the same manner as he would have required an assessee during the current assessment year. After the return has been filed in response to the said notice or if the notice is not complied with, the assessing officer will proceed in the matter as he would have proceeded against an assessee in respect of the assessment year during which the notice was served. But, after the I.T.O has initiated the proceedings, he has also to comply with the condition/requirement in the second class which is that he will complete the assessment within one year after the expiry of the financial year during which he had started the proceedings. Frankly, section 65 of the Ordinance does not in itself prescribe any special procedure for making assessment relating to any past or previous assessment year. Once the conditions on which the proceedings under it can be initiated have been fulfilled it simply directs the I.T.O. to proceed in the matter in the same manner in which he would proceed in respect of the current assessment year. Section 65 does not provide that the I.T.O. before initiating the proceedings shall ask the assessee to show cause why proceedings should not be initiated against him because he has fulfilled all the conditions under which he could initiate such proceedings. Of course, when the assessee would be showing the cause he would be entitled to contest the position that since the conditions on the existence of which the proceedings could be initiated did not exist when the proceedings were initiated the initiation of the proceedings against him was corum non judice but all this would happen after the assessing officer has already initiated the proceedings:

Held, where an assessing officer, after being satisfied that all the conditions for initiating the proceedings under section 65 of the Ordinance exist in a particular case, requires an assessee through a notice under section 56 of the Ordinance to furnish the return of his income the issuance of the notice under section 56 will be deemed to be a notice issued in pursuance of and in accordance with the provisions of subsection (1) of section 65 of the Ordinance. And, in adopting the said course by the assessing officer there will be no question of "error in jurisdiction". In the present case when the assessing officer required the assessee to furnish the returns of income for the assessment year 1974-75 onward the notice that related to the year 1974-75 did not fulfil the condition of ten years' limitation because the assessment year 1974-75 had passed more than ten years before when the said notice was issued. In this way, the initiation of proceedings in respect of the assessment year 1974-75 was beyond the scope of section 65 of the Ordinance, however since the notices relating to the assessment years to 1975-76 and onward were concerned the initiation of proceedings fulfilled all pre-initiation conditions. The proceedings in respect of the said years were in fact initiated under section 65 of the Ordinance notwithstanding that the first notice that was issued by the I.T.O required the assesses to furnish his return as required by section 56 of the- Ordinance. The order made by the I.T.O. violated the post initiation condition regarding the passing of the assessment order within one year after the expiry of the financial year in which the proceedings were initiated on 23-10-1985 that is to say in the financial year 1985-86 the assessment orders were required to be made by the I.T.O. within one year from the end of the said financial year which period ended on 30-6-1987. In this way the assessment order made by the I.T.O. in respect of the above years on 28-9-1987 was clearly beyond time.

Hafiz Muhammad Idris for Appellant (in ITAs. Nos.301(IB) to 310(IB) of 1991-92).

Mrs. Zareen Saleem Ansari, D.R. for Appellant (in ITAs. Nos.301(IB) to 310(IB) of 1991.-92).

Mrs. Zareen Saleem Ansari, D.R. for Appellant (in ITAs. Nos.10(IB) to 14(IB) of 1992-93).

Hafiz Muhammad Idris for Respondent (in ITAs. Nos.10/IB to 14/IB of 1992-93).

Date of hearing: 3rd November, 1992.

ORDER

This order disposes of fifteen appeals relating to the assessment years 1974-75 to 1988-89.

2. Briefly stated the facts of the case are that the assessee, a non-resident individual, derives income from house property. Neither the assessee nor anyone else on his behalf filed returns of income relating to the above assessment years. Obviously no tax was also paid. The survey conducted by the Department in 1984 showed that the income of the assessee during the assessment years beginning from 1974-75 was in excess of the limit, which was not taxable. An information to the above effect was conveyed by the Survey Whig of the Department to the I.T.O. having jurisdiction in the matter on 30-10-1984. The I.T.O on his turn deputed the Area Inspector to enquire into the matter. After the Area Inspector confirmed that the income of the assessee had been during all the assessment years from 1974-75 to 1984-85, in excess of the limit which was not taxable, the I.T.O. through a notice dated 23-10-1985 captioned notice under section 56 of the Income Tax Ordinance, 1979 (the Ordinance) called upon the assessee to furnish returns of his income for the years 1974-75 to 1984-85. No return m response to the above notice was, however, filed. Assessment proceedings relating to the assessment years 1974-75 to 1984-85, were pending finalization with the I.T.O. when the returns for assessment years 1985-86 and 1986-87, also fell due. Returns for these two years too were neither filed voluntarily nor in response to the notice issued by the I.T.O. under section 56 of the Ordinance during each year. Various notices under section 61 of the Ordinance were also issued by the I.T.O. to the assessee but no compliance was made. Consequently. the assessing officer proceeded to make assessment to the best of his judgment under section 63 of the Ordinance, and by an order dated 28-9-1987 made assessments for the years 1974-75 to 1986-87 Neither the returns of income for the years 1987-88 and 1988-89 were filed nor anybody responded to any notice issued by the I.T.O. under section 61 of the Ordinance, Consequently, the I.T.O made assessment for the year 1987-88 by an ex parte order dated 18-7-1988, and for the year 1988-89 by a similar order dated 12-12-1989.

3. The assessee objected to the assessment orders through appeal before the Commissioner of Income Tax (Appeals), Rawalpindi, who, by a consolidated order dated 24-3-1992, disposed of the appeals with the following results: --

(i)Assessments for the years 1974-75 to 1978-79 were annulled.

(ii)Assessments for the assessment years 1979-80 to 1988-89, were set aside for de novo assessment after ensuring proper service of notice to the assessee

The C.I.T. (Appeals) was of the view that the assessments for the assessment years 1974-75 to 1979-80 were void because the I.T.O. had initiated the proceedings relating to the above assessment years by issuing notice under section 56 of the Ordinance whereas the proceedings relating to any assessment year prior to the year of the coming into force of the Ordinance (assessment year 19','9-80) could only be initiated by issuing, a notice under section 65 of the Ordinance. In support of the above view the C.I.T. (Appeals), relied upon five Members Bench decision of this Tribunal reported as 1990 PTD (Trib.) 260. The assessments for the remaining assessment years were set aside to provide an opportunity to the assessee to present his view point, because the service of various notices on the assessee was not found proper.

4. The assessee has objected to the order of the C.I.T. (A) relating to the assessments for the years 1979-80 to 1988-89, by which the assessments for the said years have been set aside for de novo proceedings. The contention of the assessee is that the C.I.T.(A) should have annulled the assessments for the said assessment years because the proceedings relating to the said assessment years were initiated by the I.T.O. by issuing a wrong notice i.e. notice under section 56 of the Ordinance. According to the assessee the proper notice required to be issued to the assessee in respect of the said years was the notice under section 65 of the Ordinance.

5. The Department too has objected to the order of the C.I.T. (A) relating to the assessment years 1974-75 to 1978-79 on the ground that the C.I.T. (A) was not justified to annul the assessments for the said years on the ground that the proceedings in respect of the said years had been initiated by a notice under section 56 of the Ordinance and any assessment made in respect of any previous year on the basis of the notice under section 56 of the Ordinance was a nullity in law.

6. I have heard Hafiz Muhammad Idris, Advocate for the assessee and Mrs. Zareen Saleem Ansari, DR for the Department.

7. The learned counsel for the assessee in support of the appeals filed by the assessee relating to the assessment years 1979-80 to 1984-85 has contended that since proceedings relating to the above assessment years were initiated by the 1T0 by issuing the notice dated 23-10-1985 under section 56 of the Ordinance when the assessment years had already passed, the very initiation of the proceedings was void ab initio and the order that culminated out of void proceedings was also void. The counsel contended that in October 1985 the ITO could not issue any notice under section 56 of the Ordinance in respect of any assessment year before the year 1985-86. In support of the above contention, the counsel relied upon the decision of this Tribunal reported as 1987 PTD (Trib.) 314 and the decisions of this Bench dated 13-9-1989 in ITA No.455 (IB)/88-89 and dated 7-3-1989 in ITAs. Nos.67-74(IB)/88-89.

8. It is true that in the cases cited by the learned counsel for the assessee and also in some other cases this Tribunal has held that proceedings relating to any past assessment year could be initiated by the ITO by issuing notice under section 65 of the Ordinance. But, the above view has been dissented from by a five Members Bench of the Tribunal in the decision reported as 1990 PTD (Trib.) 260. The reported case quoted by the learned counsel for the assessee has been specifically dissented from by the said Bench. Therefore, in the presence of five Members Bench's decision there is no force in the contention of the assessee's counsel that the proceedings regarding the assessment year 1979-80 and onwards could not be initiated by the I.T.O. by issuing notice under section 56 of the Ordinance.

9. As far as the merits of the CIT (A)'s order relating to the assessment years 1979-80 to 1988-89 are concerned, I am satisfied that under the circumstances of the case the CIT (A) was justified to remit the case to the assessing officer for reassessment. The counsel for the assessee has contended that since none of the various notices alleged to have been issued by the assessing officer was properly served on the assessee the entire proceedings undertaken by the assessing officer were null and void and where the proceedings undertaken by an assessing officer are null and void the CIT (A) should annul the assessing officer's order. To my question whether or not the ITO had the jurisdiction to take cognizance relating to the said assessment years the counsel replied, and in my view rightly so, that he did have the jurisdiction, but the counsel contended that since the ITO had made the assessments in violation of the mandatory requirements of law regarding proper service of notices on the assessee the assessment order was void. In view of the accepted position that the Income Tax Officer had the jurisdiction to initiate proceedings in respect of the assessment year 1979-80 onward any irregularity, error or mistake committed by him in completing the proceedings would therefore tantamount to an "error in jurisdiction" rather than an "error of jurisdiction". The concepts of "error in jurisdiction" and "error of jurisdiction" have been compendiously explained by Mr. Farhat Ali Khan, Chairman of this Tribunal in a quite recent decision reported as 1992 PTD (Trib.) 1587. Those interested in the detailed annotations of the concepts are referred to the seminal judgment of late Mr. Justice Manzoor Qadir reported as PLD 1963 Lahore 391 and the law lexicons referred to by the learned Chairman in his above-cited decision. It is trite law that in case of an "error in jurisdiction" the proceedings are not void but only defective, and ordinarily the defect caused by error in jurisdiction would be curable. Therefore, where an appellate authority finds that an assessment has been made by an assessing officer in improper manner or in making the same the assessing officer has committed "error in jurisdiction" ordinarily the appellate authority will remit the case to the assessing officer for de novo proceedings. But, there may be cases though involving only `errors in jurisdiction' in which the appellate authority would be quite justified to cancel the assessment and direct the closure of the proceedings. In what cases the appellate authority should cancel the assessment and close the proceedings primarily depends upon the facts and circumstances of each case, and no generalisation of the guidelines can be made in that regard, but the governing consideration for the appellate authority will be that such authority will address itself to the question; will it not be unfair to the assessee to put him to another trial? Where the ITO and the assessee have been faced to face during the proceedings and the impropriety in proceedings or error in jurisdiction occurred primarily on the part of the assessing officer the case will not be remitted to the ITO to fill in the blanks in the proceedings unless the realisation of proper tax requires otherwise. But, where the assessee has not participated in the proceedings whether deliberately or otherwise, the case will be remitted to the assessing officer for de novo proceedings because in any such case the assessee cannot complain that it would be unfair to him to ask him to go to the assessing officer again. In this case since the assessee has not participated in the proceedings initiated by the assessing officer it would not in any manner be unfair to him to ask him to go before the ITO as has been done by the CIT (A). Accordingly, there is no force in the assessee's appeals relating to the assessment years 1979-80 to 1988-89. The same are hereby rejected.

10. So far as the appeals filed by the ITO relating to the assessment years 1974-75 to 1978-79 are concerned it appears that the CIT (A) did not go into the question whether the first notice captioned `notice under section 56 of the Ordinance that was issued to the assessee on 23-10-1985 was issued in pursuance to the initiation of the proceedings in accordance with the requirements of section 65 of the Ordinance or not. I have gone through various reported as well as such unreported decisions of this Tribunal as on which I have been able to lay my hand dilating upon the question whether assessment proceedings relating to any past assessment years could properly be initiated by issuing notice under section 56 or section 65 of the Ordinance. The last decision m the series is the decision of a five members Bench of this Tribunal reported as 1990 PTD (Trib.) 260, wherein the majority has held that proceedings in respect of any assessment year after the coming into force of the Ordinance (assessment year 1979-80) can validly be initiated by a notice under section 50 of the Ordinance. The majority view of course is illuminating. But, on my part I would like to support the validity of an assessment in respect of any past year in which the first notice that was issued to the assessee was the notice under section 56 of the Ordinance calling upon him to furnish the return of his income in respect of the relevant year. This much is clear that if after coming into force of the Ordinance an ITO intended to initiate proceedings in respect of any assessment year before the assessment year 1979-80 he could do so only in accordance with the provisions of section 65 of the Ordinance as provided by sub-clause (ii) of clause (c) of subsection (2) of section 166 of the Ordinance. But, the question is that if an assessing officer having satisfied that a case fulfils all the conditions of section 65 of the Ordinance requires the assessee through a notice under section 56 of the Ordinance to furnish the return of his income; has he not, in fact, initiated the proceedings under section 65 of the Ordinance? I would say yes.

11. Before I record my reasons in support of the above view I would, as a prelude, like to clearly state that I neither intend to over-shadow the majority view in 1990 PTD (Trib.) 260 that the assessment or reassessment in respect of an assessment year which has passed can be initiated by the ITO by requiring an assessee to furnish the return of his income for that year, nor the reasons given by the members in support of the said view. While hearing the moot on the issue whether proceedings in respect of a past assessment year can be initiated by a notice under section 56 or section 65 of the Ordinance the question that agitates one's mind is: are the notices under section 56 and section 65 of the Ordinance mutually so irrconcilably inconsistent in their contents, scope, and meaning that the issuance of one instead of the other renders the proceedings coram non judice (error of jurisdiction)? The agitation is natural in view of the following holding of the highest judicial authority of the country i.e. Supreme Court of Pakistan in case Muhammad Amir Khan v. Collector of Excise Duty, PLD 1961 Supreme Court 119 the machinery sections (of a statute) are to be construed liberally. If the incidence of tax be clear the machinery sections should be so construed as to make the realisation of proper tax possible. The machinery sections should not be so construed as to defeat the intention of the legislature and to prevent realisation of tax that may in fact, be due."

12. Before entering into the question whether the assessing officer committed an "error of jurisdiction" or "error in jurisdiction" in making assessments for the assessment years 1974-75 to 1978-79 by requiring the assessee to furnish the returns of his income for the said years through a notice under section 56 of the Ordinance it will be appropriate to recapitulate the accepted factual as well as legal position. The factual position is that on the basis of survey report supplied by the Survey Wing of the Income Tax Department and on the basis of the report made by the Area Inspector the Income Tax Officer had come into possession a definite information that the income of the assessee for the said years had escaped assessment, and the legal position is under the provision of sub-clause (ii) of clause (c) of subsection (2) of section 166 of the Ordinance, the ITO could proceed against the assessee in accordance with the provisions of section 65 of the Ordinance. Now, for the proper answer to the question whether the assessing officer committed an "error of jurisdiction" or "error in jurisdiction" it will be appropriate to compare the position what the assessing officer had actually done with the position what he was actually required to do. Because, only the extent of the resultant deficiency or inconsistency available through the comparison of two positions will provide answer to the question was the deficiency such that it rendered the proceedings before the assessing officer too defective to be cured? What the assessing officer in this case did, as indicated earlier, was that after obtaining the definite information that the income of the assessee had escaped assessment during the years 1974-75 to 1984-85 (for the purpose of the disposal of the Departmental appeals only the years 1974-75 to 1978-79 are to be considered relevant) required the assessee through a notice under section 56 of the Ordinance to furnish the returns of his income for the said years. The direction was not complied with. Various notices under section 61 of the Ordinance were also issued to the assessee but none was complied with. Consequently, the assessing officer framed the assessments to the best of his judgment under section 63 of the Ordinance by his order dated 28-9-1987. Now we see what the assessing officer would have done had he proceeded under section 65 of the Ordinance. The reproduction of section 65 as it stood on 23-10-1985 would be appropriate to ascertain the position. It read as below: --

"65.Additional assessment.--(1) If, in any year, for any reason,--

(a) any income chargeable to tax under this Ordinance has escaped assessment; or

(b) the total income of an assessee has been under assesssed, or assessed at too low a rate, or has been the subject of excessive relief or refund under this Ordinance; or ,

(c) the total income of an assessee or the tax payable by him has been assessed or determined under subsection (1) of section 59 and no order of assessment has subsequently been made under this section or any other provisions of this Ordinance;

the Income Tax Officer may, at any time, subject to the provisions of subsections (2), (3) and (4), issue a notice under section 56 and may proceed to assess or determine, by an order m writing, the total income of the assessee or the tax payable by him, as the case may be, and all the provisions of this Ordinance shall, so far as may be, apply accordingly:

Provided that the tax shall be charged at the rate or rates applicable to the assessment year for which the assessment is made.

(2)No proceedings under subsection (1) shall be initiated unless definite information has come into the possession of the Income Tax Officer or he has obtained the previous approval of the Inspecting Assistant Commissioner of Income Tax in writing to do so.

(3) Notice under subsection (1), in respect of any income year, may be issued within ten years from the end of the assessment year in which the total income of the said income year was first assessable.

(3A) Where a notice under subsection (1) is issued on or after the first day of July, 1982, an order under the said subsection shall be made after the expiration of one year from the end of the financial year in which such notice was served.

(4) Nothing contained in subsection (2) shall apply to any such case or class of cases to which clause (c) of subsection (1) applies as may be specified by the Central Board of Revenue."

13. The bare reading of the language of section 65 would show that the section in itself is not a codal provision laying down the procedure by which the assessment for any assessment year required to be made in accordance with it shall be made. Section 65 only contains substantive provisions empowering an Income-tax Officer to make assessment in respect of any previous year and specified certain conditions subject to which the assessing officer shall exercise that power. The conditions can be categorised with two classes conditions in the first class are those which must exist before an I.T.O initiates the proceedings and invites or asks the assessee to show cause why an assessment on his income should not be made and the conditions in the second class are such requirements as the I.T.O. making the assessment should comply with after he has initiated the proceedings. The conditions in the first class are: -

(i) that the I.T.O. has come into possession definite information regarding the escapement of the total or partial income of an assessee from the assessment; and

(ii) the assessment year in which any income has escaped assessment is within 10 years.

14. There is only one condition/requirement in the second class and that is the assessment in respect of any assessment year shall be made before the expiration of one year from the end of the financial year in which the proceedings were initiated. After the conditions in the first class have been fulfilled the assessing officer shall require the assessee to furnish the return of his income in the same manner as he would have required an assessee during the current assessment year. After the return has been filed in response to the said notice or if the notice is not complied with, the assessing officer will proceed in the matter as he would have proceeded against an assessee in respect of the assessment year during which the notice was served. But, after the I.T.O. has initiated the proceedings, he has also to comply with the condition/requirement in the second class which is that he will complete the assessment within one year after the expiry of the financial year during which he had started the proceedings. Frankly, section 65 of the Ordinance does not in itself prescribe any special procedure for making assessment relating to any' past or previous assessment year. Once the conditions on which the proceedings under it can be initiated have been fulfilled it simply directs the I.T.O. to proceed in the matter in the same manner in which he would proceed in respect of the current assessment year. Section 65 ibid does not provide that the I.T.O. before initiating the proceedings shall ask the assessee to show cause why proceedings should not be initiated against him because he has fulfilled all the conditions under which he could initiate such proceedings. Of course, when the assessee would be showing the cause he would be entitled to contest the position that since the conditions on the existence of which the proceedings could be initiated did not exist when the proceedings were. initiated the initiation of the proceedings against him was coram non judice but all this would happen after the assessing officer has already initiated the proceedings. In view of what has been stated above, I am, therefore, of the view that where an assessing officer after being satisfied that all the conditions for initiating the proceedings under section 65 of the Ordinance exist in a particular case requires an assessee through a notice under section 56 of the Ordinance to furnish the return of his income the issuance of the notice under section 56 ibid will be deemed to a notice issued in pursuance of and in accordance with the provisions of subsection (1) of section 65 of the Ordinance. And, in adopting the said course by the assessing officer there will be no question of "error in jurisdiction". Coming to the present case it may be noted that when the assessing officer required the assessee to furnish the returns of income for the assessment year 1974-75 onward the notice that related to the year 1974-75 did not fulfil the condition of ten years' limitation because the assessment year 1974-75 and passed more than ten years before when the said notice was issued. In this way, the initiation of proceedings in respect of the assessment year 1974-75 was beyond the scope of section 65 of the Ordinance, however since the notices relating to the assessment year to 1975-76 and onward were concerned the initiation of proceedings fulfilled all pre-initiation conditions, I am inclined to hold that the proceedings in respect of the said years were in fact initiated under section 65 of the Ordinance notwithstanding that the first notice that was issued by the I.T.O. required the assessee to furnish his return as required by section 56 of the Ordinance. If the matter would have ended there I would have accepted the appeals filed by the I.T.O. so far as they related to the said assessment year but I find that the order made by the I.T.O. on 28-9-1987 violated the post initiation condition regarding the passing of the assessment order within one year after the expiry of the financial year in which the proceedings were initiated on 23-10-1985 that is to say in the financial year 1985-86 the assessment orders were required to be made by the I.T.O. within one year from the end of the said financial year which period ended on 30-6 1987. In this way the assessment order made by the I.T.O. in respect of the above years on 28-9-1987 was clearly beyond time. Consequently, the CIT (A)'s order in respect of the appeals for the assessment years 1974-75 to 1978-79 is therefore maintained though on different grounds. The appeals filed by the I.T.O. too are hereby rejected.

15. Conclusion. The appeals filed by the assessee relating to the assessment years 1979-80 to 1988-89 and by the ITO relating to the assessment years 1974-75 to 1978-79 are rejected.

M.BA./1942/T Order accordingly.