Nazir Ahmad, J. - (1.) A statement of the case has been submitted by the Income-tax Appellate Tribunal, Patna Bench " A", Patna, under Section 256(2) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), under the direction of this court referring the following question for opinion of this court: " Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the assessment for the assessment year 1966-67 on the firm was barred by limitation ? "
(2.) THE relevant facts of the case can be culled out from the statement of the case. For the assessment year 1966-67, the assessee had filed a return on September 26, 1966, claiming the status of a registered firm. According to the claim of the assessee, there was a partial partition in the erstwhile Hindu undivided family (hereinafter referred to as "the HUF") and some of the members had entered into a partnership for carrying on this business. This claim of partition had not been accepted by the Income-tax Officer but- the Appellate Assistant Commissioner accepted the claim of partition. THE Appellate Assistant Commissioner also directed that the assessment should be made afresh in the correct status. This appellate order was passed on December 31/1971, and the Income-tax Officer made the assessment on February 14, 1972, in the status of a registered firm. THE order of the Income-tax Officer has been annexed and marked as annexure A forming part of the statement of the case. Before the Appellate Assistant Commissioner, a plea was raised that the assessment in the status of a firm as made on February 14, 1972, was barred by limitation. The Appellate. Assistant Commissioner, however, did not accept -this plea as, according to him, this assessment was protected by Sub-section (3) of Section 153 of the Act. As the Income-tax Officer had acted on the direction of the Appellate Assistant Commissioner, the Appellate Assistant Commissioner held that the assessment was protected and could not be held to be time-barred. The Appellate Assistant Commissioner thus overruled the claim of the assessee that the assessment was barred by limitation. The Appellate Assistant Commissioner also observed that if the appeal had been disposed of in proper time, the Income-tax Officer would have made the assessment within the normal period of limitation allowed under the law. The order of the Appellate Assistant Commissioner has been annexed and marked as annexure B forming part of the statement of the case. When the matter came before the Income-tax Appellate Tribunal, it was contended that the original assessment was made on the Hindu undivided family and no assessment was made on the return filed by the assessee as a firm on September 26, 1966. It was also argued before the Appellate Tribunal that the assessment set aside was that of the Hindu undivided family and, therefore, it could not be said that the direction of the Appellate Assistant Commissioner to make fresh assessment in accordance with the correct status, saved the limitation in the case of the firm. The Tribunal upheld the contention of the assessee as it was found that no assessment had been made though the return had been filed in the case of the firm on September 2'6, 1966, and so the assessment on the firm had clearly become barred by limitation on February 14, 1972. For this purpose, the Tribunal relied on the case CIT v. Rameshwarlal Sanwarmal [1971] 82 ITR 628 (SC). The Tribunal, therefore, held that the assessment made oh the firm was invalid and barred by limitation. The order of the Tribunal has been annexed and marked as annexure C forming part of the statement of the case. From the order of the Tribunal, annexure "C", it is evident that on September 26, 1966, the assessee filed two returns, one in the status of the Hindu undivided family and the other in the status of a firm. This will be evident from paragraph 9 of the order of the Tribunal. This is also evident from paragraph 2 of the order of the Tribunal, annexure C-1, which is a copy of the order dated January 10, 1975, by which the Tribunal rejected the reference application under Section 256(1) of the Act. The Commissioner of Income-tax filed an application before this court and it will be evident from paragraph 1 at page 13 of the paper book that the assessee filed a return claiming the status as a registered firm on September 26, 1966, and another return was filed on the same date in the status of a Hindu undivided family. Thus, in view of these materials, it has to be held that the assessee filed one return on September 26, 1966, claiming the status as a registered firm and on the same date the other return was also filed in the status of a Hindu undivided family. However, the assessment order of the Income-tax Officer against the Hindu undivided family and even the order of the Appellate Assistant Commissioner relating to the Hindu undivided family have not been annexed to the statement of the case. But the Appellate Assistant Commissioner has mentioned in his order, annexure B, that the appellant originally filed a return on September 26, 1966, claiming the status of a registered firm and the claim was not entertained and the Income-tax Officer did not accept the partial partition which resulted in the partnership and made the assessment in the status of a Hindu undivided family which had riot been properly partitioned and the appellant came up in appeal and it was decided by the Appellate Assistant Commissioner that the partition claim was genuine and should have been allowed, and the Appellate Assistant Commissioner, therefore, directed that the assessment should be made afresh in the correct status. Thus, it is not clear from the assessment order of the Income-tax Officer or the order of the Appellate Assistant Commissioner whether the assessment was made on the basis of the return as Hindu undivided family or on the basis of the return as registered firm. However, the order of the Tribunal, annexure C, shows in paragraph 10 that there was no assessment on the firm although it filed return on September 26, 1966, and, therefore, there was no question of setting aside any assessment made against the firm and that what was set aside by the Appellate Assistant Commissioner was the assessment made by the Income-tax Officer on the Hindu undivided family. In the order of the Tribunal, there is some confusion about the date of the filing of the return. In paragraph 7, it has been clearly mentioned that the assessee filed return claiming the status as a registered firm on September 26, 1966, but in paragraphs 9 and 10, the date has been noted as June 29, 1966. However, the Appellate Assistant Commissioner has clearly mentioned that the date of filing of the return was September 26, 1966. Under such circumstances, I have to accept the position that the assessee filed one return in the status of a registered firm and another return in the status of a Hindu undivided family on September 26, 1966, and that the Income-tax Officer made the assessment on the Hindu undivided family rejecting the claim of the assessee as a registered firm and then the Hindu undivided family originally filed an appeal before the Appellate Assistant Commissioner and the Appellate Assistant Commissioner accepted the genuineness of the firm and partial partition of the Hindu undivided family and directed the Income-tax Officer to make correct assessment in the status of a firm.
(3.) SECTION 153(1)(a)(i) of the Act lays down that no order of assessment shall be made under SECTION 143 at any time after the expiry of four years from the end of the assessment year in which the income was first assessable, where such assessment year is an assessment year commencing on or before the 1st day of April, 1967. The assessment involved in the present" case before me is the assessment year 1966-67, and thus in this case, the assessment had to be completed within four years from the end of the assessment year. Thus, the assessment should be completed for the assessment year 1966-67 by March 31, 1971, in the ordinary course. Before taking up the legal position, it is necessary to point out that the registered firm .has been assessed as M'/s. Dhanpatram Chhotelal and the share allocation has been made in the name of Shri Dhanpatrarn and Shri Chhotelal in equal shares. The assessee-Hindu undivided family is Dhanpatrarn Chhotelal and it also cannot be doubted that Dhanpatram is the father and Chhotelal is his son. Thus, these two persons will also have concern with the assessee-Hindu undivided family, Section 153(3)(ii) lays down that the provisions of Sub-section (1) of Section 153 shall not apply relating to the assessment, reassessment or recomputation which may, subject to the provisions of Sub-section (2A), be completed at any time where the assessment, reassessment or recomputation is made on the assessee or any person in consequence of or to give effect to any finding or direction contained in an order under Section 250 of the Act. Sub-section (2A) is not applicable in the present case. Explanation 3 to Section 153 of the Act lays down that where, by an order referred to in Clause (ii) of Sub-section (3), any income is excluded from the total income of one person and held to be the income of another person, then, an assessment of such income on such other person shall, for the purposes of Section 150 and, this section, be deemed to be one made in consequence of or to give effect to any finding or direction contained in the said order, provided such other person was given an opportunity of being heard before the said order was passed. Explanation 3 in the present form was amended by the Direct Taxes (Amendment) Act, 1964, with effect from October 6, 1964. Thus, according to Explanation 3, it is evident that if the assessment was made on the Hindu undivided family and the Appellate Assistant Commissioner held that the assessment should be made in the status of a registered firm, then the Income-tax Officer could not proceed to make1 assessment against the registered firm, in view of this Explanation. Mr. K.N. Jain, learned advocate for the assessee-opposite party, has invited our attention to Section 2(31) of the Act which says that a person includes a Hindu undivided family as well as a firm. He has also invited our attention to Section 2(7) which lays down that an "assessee" means a person by whom any tax or any other sum of money is payable under the Act. He has also invited our attention to Section 4(1) of the Act where it has been laid down that where any Central Act enacts that income-tax shall be charged for any assessment year at any rate or rates, income-tax at that rate or those rates shall be charged for that year in accordance with, and subject to the provisions of this Act, in respect of the total income of the previous year or previous years, as the case may be, of every person. He has also referred to Section 139(1) of the Act which lays down that every person, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax, shall furnish a return of his income or the income of such other person during the previous year in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed. He has also referred to Section 148(1) of the Act where the word "assessee" has been used. He has also referred to Section 246 under which an assessee can file an appeal before the Appellate Assistant Commissioner. ;