High Court Of Allahabad
CIT vs. Bajrang Dal Mills
Section 146
Asst. Years 1977-78, 1978-79
R.K. Agrawal & Prakash Krishna, JJ.
IT Ref. Nos. 68 of 1987 & 275 of 1991
30th September, 2005
Counsel Appeared
Shambhu Chopra, for the Revenue : None, for the Assessee
JUDGMENT
Prakash Krishna, J. :
In IT Ref. No. 68 of 1987 the Tribunal, Allahabad, has referred the following question of law under s. 256(1) of the IT Act, 1961 (hereinafter referred to as “the Act”), for opinion to this Court :
“Whether s. 5 of the Indian Limitation Act is applicable to the income-tax proceedings ?”
Whereas in IT Ref. No. 275 of 1991 which relates to proceedings for imposition of penalty under s. 273(c) of the Act for the asst. yrs. 1977-78 and 1978-79, the Tribunal has referred the following identical question of law for opinion to this Court :
“Whether the Tribunal was correct in law in cancelling penalty of Rs. 15,000 imposed under s. 273 (c) in view of the facts and circumstances of the case when the order dt. 21st Jan., 1986 in ITA Nos. 2086 and 2087/All relied upon is already sub judice before the Hon’ble High Court by way of Departmental application under s. 256(1) against it allowed by the Tribunal ?”
2. Briefly stated the facts giving rise to the present Ref. No. 68 of 1987 are as follows. The reference relates to the asst. yrs. 1977-78 and 1978-79. The assessments for the assessment years in question were completed under s. 144 on 20th Feb., 1981. The assessment orders were served on the assessee on 9th March, 1981. The assessee moved an application under s. 146 on 9th April, 1981. Whereas under the stipulated provisions of the Act, the application under s. 146 should have been filed on or before 8th April, 1981. The assessee accordingly moved an application for condonation of the delay of one day under s. 5 of the Limitation Act. The ITO considered the submission of the assessee and observed that in view of the clear provisions of s. 146, he had no powers to condone the delay. The ITO accordingly rejected the applications under s. 146 holding that it was barred by time. The assessee came up in further appeal before the CIT(A) and the CIT(A) agreed with the submissions of the assessee that the provisions of s. 5 of the Limitation Act, 1963, were applicable and that the ITO ought to have condoned the delay in the prevailing circumstances in filing the application under s. 146. The CIT(A) accordingly set aside the order of the ITO passed under s. 146 and directed the ITO to accept the assessee’s applications under s. 146 and to reframe the assessments made by him under s. 144 for the assessment years in question.
3. In further appeal the Tribunal agreed with the order of the CIT(A) with the following observation : “7. We have considered the submissions of the parties and have gone through the material on record. It is clear from the aforesaid submission of the Departmental Representative/Authorised Representative for the assessee that the Hon’ble Madhya Pradesh High Court had taken a view favourable to the Department, whereas the Hon’ble Punja & Haryana High Court had taken a view in favour of the assessee. Accordingly, the order of the CIT(A) is well supported by the decision of the Punjab & Haryana High Court; though it is against the Department, since there is divergence of opinion between the two High Courts as to the application of the provision of the Limitation Act in the income-tax matters, the authority of the Hon’ble Supreme Court in the cases of CIT vs. Vegetable Products Ltd. 1973 CTR (SC) 177 : (1973) 88 ITR 192 (SC) and CIT vs. Naga Hills Tea Co. Ltd. 1973 CTR (SC) 329 : (1973) 89 ITR 236 (SC) comes into play and thus we are inclined to follow the view expressed by their Lordships of the Punjab & Haryana High Court which is in favour of the assessee. Having considered all these facts, we are of the opinion that the delay of one day was rightly condoned by the CIT(A) and accordingly we uphold the order of the CIT(A).”
The Department sought the present reference which was accepted by the Tribunal. In the meantime, the Tribunal vide its order dt. 31st May, 1990 in ITA Nos. 677 and 678/All/1978-79, had upheld the order of the CIT(A) cancelling the penalty of Rs. 15,000 imposed under s. 273(c) following its earlier order dt. 21st Jan., 1986. The Tribunal has referred the aforementioned common question in IT Ref. No. 275 of 1991. Heard learned standing counsel for the Department, Shri Shambhu Chopra; learned counsel for the assessee submitted that he has no instructions in the matter.
We find that there is a divergence of opinion of different High Courts on the aforesaid question of law. A Full Bench judgment of the Madhya Pradesh High Court in Nihalkaran vs. CWT (1987) 65 CTR (MP)(FB) 262 : (1987) 168 ITR 508 (MP)(FB) has held with reference to s. 27(3) of the WT Act that the language of s. 29(2) of the Limitation Act, 1963, which came into force w.e.f. 1st Jan., 1964, is, however, materially different. Sec. 29(2) of the Limitation Act, 1963, inter alia, provides that ss. 4 to 24 shall apply to a special or local law unless their application is expressly excluded, with the result unless the application of s. 5 of the Limitation Act was expressly excluded to an application under s. 27(3) of the Act, it would apply. It was held that s. 5 of the Limitation Act applies to an application under s. 27(3) of the WT Act and reliance has been placed by it on a decision of the Supreme Court in Hukumdev Narain Yadav vs. Lalit Narain Mishra AIR 1974 SC 480 and a case of Guwahati High Court in A. Gupta Trust Estate vs. CWT (1984) 148 ITR 366 (Gau). It may be noted here that the Madhya Pradesh High Court was considering the question of applicability of s. 5 of the Limitation Act to an application to the High Court under s. 27(3) of the WT Act. Sec. 27(3) of the WT Act deals with reference application filed before the High Court for calling the reference. In that connection it was held that s. 5 of the Limitation Act is applicable and the law as laid down by the Madhya Pradesh High Court should be understood in that particular factual backdrop.
In contra, the Andhra Pradesh High Court in the case of B. Subba Rao vs. IAC (1987) 63 CTR (AP) 287 : (1987) 167 ITR 757 (AP), has held that the Limitation Act applies wholly to Civil Courts and not to quasi-judicial Tribunals, even though such Tribunals may be vested with certain specified powers conferred on Courts under the Codes of Civil or Criminal Procedure. The question arose in connection with the delayed filing of an appeal under s. 269G of the Act. It has been held that s. 29(2) of the Limitation Act does not have the effect of extending the application of the Limitation Act to Tribunals. The Andhra Pradesh High Court in the aforesaid case has disagreed with the decision of the Punjab & Haryana and the Madhya Pradesh High Courts and has held that the provisions of s. 5 of the Limitation Act can be invoked in a proceeding pending before the Court and not before the Tribunal. It has relied upon a judgment of the Supreme Court given in the case of Sakuru vs. Tanaji AIR 1985 SC 1279. The Supreme Court has held that the appellate authority under the Andhra Pradesh (Telangana Area) Tenancy and Agricultural Lands Act has no power to condone the delay in filing the appeal under s. 5 of the Limitation Act because the Limitation Act applies only to Civil Courts and not to Tribunals and also because there is no provision in the Act making s. 5 of the Limitation Act applicable to the proceedings under that Act. It is apt to reproduce the relevant para from the judgment of the Supreme Court hereinbelow : “After hearing both sides, we have unhesitatingly come to the conclusion that there is no substance in this appeal and that the view taken by the Division Bench in Venkaiah’s case AIR 1978 AP 166 is perfectly correct and sound. It is well settled by the decisions of this Court in Town Municipal Council vs. Presiding Officer, Labour Court AIR 1969 SC 1335 : (1969) 36 FJR 177 (SC), Nityanand M. Joshi vs. Life Insurance Corporation of India (1969) 36 FJR 324 (SC) and Smt. Sushila Devi vs. Ramanandan Prasad 1976 (2) SCR 845, that the provisions of the Limitation Act, 1963, apply only to proceedings in ‘Courts’ and not to appeals or applications before bodies other than Courts such as quasi-judicial Tribunals or executive authorities, notwithstanding the fact that such bodies or authorities may be vested with certain specified powers conferred on Courts under the Codes of Civil or Criminal Procedure. The Collector before whom the appeal was preferred by the appellant herein under s. 90 of the Act not being a Court, the Limitation Act, as such, had no applicability to the proceedings before him. But even in such a situation the relevant special statute may contain an express provision conferring on the appellate authority, such as the Collector, the power to extend the prescribed period of limitation on sufficient cause being shown by laying down that the provisions of s. 5 of the Limitation Act shall be applicable to such proceedings.” Also in Smt. R. V. Sarojini Devi vs. IAC (1999) 152 CTR (Mad) 32 : (2000) 242 ITR 329 (Mad) it has been held that the Tribunal referred to in s. 269G of the Act is obviously not a Court as defined in s. 269A(c) of the Act. If the Tribunal is not a Court, the provisions of the Limitation Act would clearly be inapplicable to the proceedings before the Tribunal. It has followed the judgment of the Patna, Delhi and Andhra Pradesh High Courts in the cases of IAC vs. Kedar Nath Jhunjhunwalla (1982) 133 ITR 746 (Pat); Deen Dayal Goyal vs. ITAT (1986) 51 CTR (Del) 1 : (1986) 158 ITR 391 (Del) and B. Subba Rao vs. IAC (supra). A Division Bench of this Court in the case of Sheo Prasad Vinod Kumar vs. Union of India (2001) 168 CTR (All) 177 : (2001) 248 ITR 619 (All) interpreted the proviso to sub-s. (1) of s. 256 of the IT Act and has come to the conclusion that the said proviso limits the power of the Tribunal to condone the delay in filing the application only for 30 days. It has no jurisdiction to condone the delay after the expiry of the period provided in the said proviso. The aforesaid judgments do lend support to the arguments of learned standing counsel, on the facts of the present case.
At this juncture the departure made by the Limitation Act, 1963, from the earlier Limitation Act, 1908, is to be noted. The Supreme Court has pointed out this difference in the case of Gopal Sardar vs. Karuna Sardar (2004) 4 SCC 252. This case is an authority for the proposition that a departure has been made in s. 29(2) of the Limitation Act of 1963, from the Indian Limitation Act, 1908. Under the Indian Limitation Act, 1908, s. 29(2)(b) provided that for the purpose of determining the period of limitation prescribed for any suit, appeal or application by any special law or local law the application of s. 5 of the Limitation Act was specifically and in clear terms excluded. Under s. 29(2) of the present Limitation Act, 1963, s. 5 applies in the case of special or local law to the extent to which it is not expressly excluded by special or local law. It has been further held that even in the case where the special law does not exclude the provisions of ss. 4 to 24 of the Limitation Act by an express reference, it would nonetheless be open to the Court to examine whether or/and to what extent the nature of those provisions or the nature of the subject-matter of scheme of special law excludes their operation.
The Supreme Court in the case of Gopal Sardar (supra) has considered its earlier judgment given in the cases of CST vs. Parson Tools & Plants 1975 CTR (SC) 88 : AIR 1975 SC 1039, Hukumdev Narain Yadav vs. Lalit Narain Mishra (supra) and other judgments. It has noted the departure made in s. 29(2) of the Limitation Act, in comparison to the old Limitation Act, 1908. The relevant para is reproduced below : “An important departure is made in s. 29 sub-s. (2) of the Limitation Act of 1963. Under the Indian Limitation Act, 1908, s. 29(2)(b) provided that for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law the application of s. 5 of the Limitation Act was specifically and in clear terms excluded, but under s. 29(2) of the present Limitation Act, s. 5 shall apply in case of special or local law to the extent to which it is not expressly excluded by such special or local law. In other words, application of s. 5 of the Limitation Act stands excluded only when it is expressly excluded by the special or local law. The emphasis of the argument by the learned counsel who argued for the proposition that s. 5 of the Limitation Act is applicable to an application made for enforcement of rights of pre-emption under s. 8 of the Act was on the ground that the Act has not expressly excluded the application of s. 5 of the Limitation Act.” Ultimately it has reached to the following conclusion which is reproduced below : “Considering the scheme of the Act being a self-contained code in dealing with the matters arising under s. 8 of the Act and in the light of the aforementioned decisions of this Court in the cases of Hukumdev Narain Yadav (1974) 2 SCC 133, Anwari Basavaraj Patil (1993) 1 SCC 636 and Parson Tools 1975 CTR (SC) 88 : AIR 1975 SC 1039, it should be construed that there has been exclusion of application of s. 5 of the Limitation Act to an application under s. 8 of the Act. In view of what is stated above, the non- applicability of s. 5 of the Limitation Act to the proceedings under s. 8 of the Act is certain and sufficiently clear. Sec. 29(2) of the Limitation Act as to the express exclusion of s. 5 of the Limitation Act and the specific period of limitation prescribed under s. 8 of the Act without providing for either extension of time or application of s. 5 of the Limitation Act or its principles can be read together harmoniously. Such reading does not lead to any absurdity or unworkability or frustrating the object of the Act. At any rate, in the light of the three-Judge Bench decision of this Court in Hukumdev Narain Yadav (supra) and subsequently followed in Anwari Basavaraj Patil (supra) even though the special or local law does not state in so many words expressly that s. 5 of the Limitation Act is not applicable to the proceedings under those Acts, from the scheme of the Act and having regard to various provisions such express exclusion could be gathered. Thus, a conscious and intentional omission by the legislature to apply s. 5 of the Limitation Act to the proceedings under s. 8 of the Act, looking to the scheme of the Act, nature of right of pre-emption and express application of s. 5 of the Limitation Act to the other provisions under the Act, itself means and amounts to ‘express exclusion’ of it satisfying the requirement of s. 29(2) of the Limitation Act.”
It has come to the conclusion that its judgment given in the case of Mukri Gopalan vs. Cheppilat Puthanpurayil Aboobacker (1995) 5 SCC 5 cannot be applied in support of the submission that s. 5 of the Limitation Act is applicable to a proceeding under a special Act, with the observation that in “any case” the case of Mukri Gopalan (supra) was decided by two learned Judges of the Court.
11. Recently the Supreme Court in the case of L.S. Synthetics Ltd. vs. Fairgrowth Financial Services Ltd. (2004) 7 JT 254 (SC) has considered the question as regards the applicability of the Limitation Act to the proceedings under the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992. It has been observed by the apex Court that the Limitation Act, 1963, is applicable only in relation to certain applications and not all applications despite the fact that the words “other proceedings” are added in the long title of the Act of 1963. It has been held that the provisions of the Limitation Act are not applicable to the proceedings before bodies other than the Courts, such as quasi-judicial Tribunal or even in a Tribunal. The relevant portion is quoted below :
“The provisions of the said Act are not applicable to the proceedings before bodies other than Courts, such as quasi-judicial Tribunal or even an executive authority. The Act primarily applies to the civil proceedings or some special criminal proceedings. Even in a Tribunal, where the CPC or the Cr.PC is applicable, the Limitation Act,1963, per se may not be applied to the proceedings before it. Even in relation to certain civil proceedings, the Limitation Act may not have any application. As for example, there is no bar of limitation for initiation of a final decree proceedings or to invoke the jurisdiction of the Court under s. 151 of the CPC or for correction of accidental slip or omission in judgments, orders or decrees; the reason being that these powers can be exercised even suo motu by the Court and, thus, no question of any limitation arises.”
12. In Fairgrowth Investments Ltd. vs. Custodian (2004) 9 JT 124 (SC), the Supreme Court has followed its earlier judgment given in the case of L.S. Synthetics Ltd. (supra) and has made the following observation with regard to s. 29(2) of the Limitation Act : “Finally, s. 29(2) of the Limitation Act speaks of application of the provisions contained in ss. 4 to 24 ‘only insofar as, and to the extent to which, they are not expressly excluded by such special or local law’. This language, together with our earlier reasoning, particularly with regard to L.S. Synthetics Ltd. (2004) 7 JT 254 (SC), would answer the further question raised by the appellant, namely, whether the question of exclusion of the provisions of the Limitation Act must be separately considered with reference to different provisions of a special/local Act or in connection with the provisions of the special/local Act, as a whole, by affirmation of the first alternative. We are therefore not called upon to decide whether claims either preferred for the first time before the Special Court or transferred to the Special Court under s. 9A(2) would attract the provisions of ss. 4 to 24 of the Limitation Act. It is enough for the purpose of this appeal to hold that s. 29(2) of the Limitation Act, 1963 does not apply to proceedings under s. 4(2) of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992. Since the appellant’s petition of objection had been filed much beyond the period prescribed under that section, the Special Court was right in rejecting the petition in limine. The appeal is accordingly dismissed but without any order as to costs.”
In this case the Supreme Court has considered its various earlier judgments including in the cases of Vidyacharan Shukla vs. Khubchand Baghal 1964 (6) SCR 129 and Hukumdev Narain Yadav (supra) and also in the case of Gopal Sardar vs. Karuna Sardar (supra). This case is an authority for the proposition that a departure has been made in s. 29(2) of the Limitation Act of 1963 from the Indian Limitation Act, 1908. Under the Indian Limitation Act, 1908, s. 29(2)(b) provides for the purpose of determining a period of limitation prescribed for any suit, appeal or application by any special law or local law the application of s. 5 of the Limitation Act was specifically and in clear terms excluded. Under s. 29(2) of the present Limitation Act, 1963, s. 5 applies in the case of special or local law to the extent to which it is not expressly excluded by special or local law. It has been further held that even in the case, where the special law does not exclude the provisions of ss. 4 to 24 of the Limitation Act by an express reference, it would nonetheless be open to the Court to examine whether or/and to what extent the nature of those provisions or the nature of the subject-matter or scheme of special law excludes their operation. In this case also the Supreme Court followed its dictum as given in the case of Parson Tools (supra) and has come to the conclusion that the benefit of s. 5 of the Limitation Act cannot be extended in late filing of the application under s.8 of the West Bengal Land Reforms Act, 1955. The Court examined the scheme of the West Bengal Land Reforms Act and came to the conclusion that the scheme of the Act impliedly excludes the application of s. 5 of the Limitation Act to the aforesaid Act.
In the above case the Supreme Court was considering the question of condonation of delay for filing an application in the nature of suit beyond the prescribed time for the enforcement of right of pre-emption under the provisions of the West Bengal Land Reforms Act, 1955. It examined the nature of right of pre-emption and also the West Bengal Land Reforms Act and was of the view that the right of pre-emption is a statutory right and is a weak one to be exercised strictly in terms of s. 8 and considerations of equity do not apply. It was held that the delay in filing the said application would not be condoned by invoking the provisions of s. 5 of the Limitation Act. In view of very weak nature of the right of pre-emption it was held that the applicability of the provisions of s. 5 of the Limitation Act r/w s. 29(2) of the Limitation Act stands impliedly excluded. The application for enforcement of right of pre-emption by a purchaser is required to be filed within 4 months from the date of such transfer under s. 8 of the West Bengal Land Reforms Act, 1955. The provisions of the Limitation Act were made applicable by express provision in filing the appeal and revision under s. 14H and s. 19 of the Act. Further, it is clear that there was no specific exclusion of the Limitation Act in s. 8 of that Act which provides the filing of application in the nature of a suit for enforcement of right of pre-emption by a purchaser. But even then the Supreme Court held that the provisions of the Limitation Act stand excluded so far as the delay in filing of the application under s. 8 of the aforesaid Act is concerned.
We have also examined the said question in connection with the late filing of a reference application under s.35H(1) of the Central Excise Act in Central Excise Ref. Appln. No. 4 of 2001, CCE vs. Salora International Ltd. and by the judgment dt. 13th Sept., 2005, have held that the general provisions of the Limitation Act will not apply to condone the delay in late filing of a reference application under s. 35H(1) of the Central Excise Act by invoking s. 29(2) of the Limitation Act, 1963.
15. Coming to the facts of the present case we find that an application for reopening of assessment at the instance of the assessee under s. 146(1) has to be filed “within one month from the date of service of notice of demand issued in consequence of assessment”. Two things are clear. Firstly, there is no express provision under the IT Act making the provisions of s. 5 of the Limitation Act applicable to such an application filed under s. 146 of the Act. Secondly, the ITO while entertaining the application for reopening of assessment under s. 146 of the Act does not act as a Court. He acts at the most as a quasi-judicial authority. In the case in hand, as found by the authorities below, the application for reopening of the assessment was filed beyond one day of one month. The IT Act is a self-contained Act. It defines the taxable income, income chargeable to tax, its method of computation. It provides the Departmental appeals before the first appellate authority as well as before the Tribunal. In the absence of any express provision of applicability of s. 5 of the Limitation Act to an application filed before the assessing authority it is difficult to hold that such assessing authority is competent to accept the application filed beyond the prescribed period, as prescribed under the IT Act. Sec. 29(2) of the Limitation Act would also not make s. 5 of the Limitation Act applicable as the assessing authority is not a Court. The Supreme Court has laid down that the provisions of s. 5 of the Limitation Act are applicable to a proceeding pending before a Court and not otherwise as laid down in the case of Sakuru vs. Tanaji (supra).
16. We could lay hands on a recent judgment of the Supreme Court in the case of CIT vs. Data Software Research Co. Ltd. (2000) 162 CTR (SC) 398 : (2001) 247 ITR 207 (SC). In this case the assessee failed to produce the copy of the agreement which he was required to do before the first day of October of the assessment year in relation to which the approval is first sought, under s. 80O of the IT Act. The High Court had condoned the delay and directed the consideration of the agreements filed belatedly on the merits. The Supreme Court accepted the argument of the Revenue that there is no provision for condonation of delay in s. 80-O, with the following observation : “The provisions of s. 80-O mandate the production of the agreements in respect of which relief is sought, ‘before the 1st day of October of the assessment year in relation to which the approval is first sought’, and there is no provision for the condonation of such delay. There was also no application before the Central Board for condonation of delay. In the circumstances, the High Court ought not to have directed that delay in the production of the agreements be condoned. The Courts are obliged to do justice according to the law. In ordering condonation of delay in these circumstances, it cannot, in our opinion, be said that justice according to the law was rendered by the High Court.”
17. We are conscious of the fact that the view which we are proposing to take in the matter may work some hardship in certain cases. But hardship or injustice may be a relevant consideration in applying the principles of interpretation of statute, but cannot be a ground for extending the period of limitation, as observed by the Supreme Court in a recent decision, Damodaran Pillai vs. South Indian Bank Ltd. (2005) 8 JT 197 (SC). In this case the Supreme Court was called upon to decide as to whether the inherent power of Court for condonation of delay can be invoked by a Court when by express provision, the applicability of s. 5 of the Limitation Act has been excluded under Order 21 of the CPC to an application for execution. The execution application was dismissed in default and the restoration application was filed beyond the period prescribed under Order 21, r. 105, CPC. The argument of the decree-holder was that notwithstanding the fact about the exclusion of applicability of s. 5 of the Limitation Act, the Court has inherent power to restore the execution application even if the restoration application was filed beyond the prescribed period. Repelling the said argument of the decree-holder the Supreme Court in the aforementioned case has relied upon its earlier judgment given in the case of R. Rudraiah vs. State of Karnataka (1998) 1 JT 435 (SC), wherein it was held that an application under the relevant Act (Karnataka Land Reforms Act, 1961) before the Tribunal be made before the expiry of the period of six months from the date of commencement of s. 1 of the Karnataka Land Reforms (Amendment) Act, 1978. It cannot be made after six months. The observation made in the aforesaid case of R. Rudraiah (supra) which was reproduced by the apex Court in the subsequent judgment of Damodaran Pillai (supra), is reproduced below : “17. It is true there is a principle of interpretation of statutes that the plain or grammatical construction which leads to injustice or absurdity is to be avoided [see Venkatarama Iyer, J. in Tirath Singh vs. Bachittar Singh AIR 1955 SC 830, 855]. But that principle can be applied only if ‘the language admits of an interpretation which would avoid it’. [Shamrao V. Parulekar vs. District Magistrate AIR 1952 SC 324]. In our view s. 48A as amended, has fixed a specific date for the making of an application by a simple rule of arithmetic, and there is therefore no scope for implying any ‘ambiguity’ at all. Further the fixation of periods of limitation must always be to some extent arbitrary, and may frequently result in hardship. But in construing such provisions, equitable considerations are out of place, and the strict grammatical meaning of the words is the only safe guide.”
The other cases relied upon by learned standing counsel : (1) CIT vs. Orissa Concrete & Allied Industries Ltd. (2003) 185 CTR (Cal) 315 : (2003) 264 ITR 186 (Cal), (2) CIT vs. Subhash Chand Goyal (2001) 251 ITR 728 (All) and (3) Mangu vs. State of Rajasthan AIR 1976 SC 176, being besides the point need no discussion. These decisions have no relevancy at all to the controversy involved in the facts of the present case.
In IT Ref. No. 275 of 1991 the order of penalty was set aside by the Tribunal on a limited ground that the provision of s. 5 of the Limitation Act is applicable to an application filed under s. 146(1) of the Act. We have held otherwise in the connected Ref. No. 68 of 1987. Meaning thereby the setting aside of order of penalty on the above limited ground is unjustified. Now the Tribunal will redecide the appeals on grounds other than the question of applicability of the Limitation Act. We answer the question in Ref. No. 275 of 1991 accordingly, i.e., in favour of the Revenue and against the assessee.
In view of the above discussion we answer the aforesaid question of law in both the income-tax references in the negative, i.e., in favour of the Revenue and against the assessee and hold that s. 5 of the Indian Limitation Act is not applicable to the income-tax proceedings under s. 146 of the Act.
There shall be no order as to costs.
[Citation : 282 ITR 44]
