P.N. BHAGWATI, J.M. SHELAT

(1) These petitions involve common questions of law and are founded on the same facts and it would therefore be convenient to dispose them of by a single judgment. Certain notices were issued against the petitioners by the Income-tax Officer Special Circle Ahmedabad on 31 January 1962 under section 34(1)(a) of the Income-tax Act 1922 The reason for issuing the notices was that according to the Incometax Officer the following income of each petitioner had escaped assessment in the assessment year mentioned against the respective income by reason of his omission or failure to disclose fully and truly all material facts necessary for his assessment for such assessment year: @@@ ------------------------------------------------------------------------------------------------------------------------ Each of the petitioners in } Rs. 41 0 the assessment year 1943-44. special Civil } Rs. 91 575/-in the assessment year 1946-47. Applications Nos. 370 371 } Rs. 36 535 the assessment year 1950-51. and 372 of 1962. } The petitioner in Special } Rs. 84 520 the assessment year 1943-44. Civil Application No. 373 } Rs. 1 40 370 the assessment year 1946-47. of 1962. } Rs. 55 122 the assessment year 1950-61. The petitioner in Special } Civil Application No. 314 } Rs. 1 60 740 the assessment year 1943-44. of 1962. ------------------------------------------------------------------------------------------------------------ and the Income-tax Officer therefore proposed to reassess such escaped income by reopening the assessment of each petitioner for the respective assessment year. There were separate notices to each petitioner in respect of each assessment year and it was stated in each of the notices that it was issued after obtaining the necessary satisfaction of the Commissioner of Income-tax Gujarat or the Central Board of Revenue New Delhi as the case may be. The petitioners were of the view that the notices were illegal and void and they therefore preferred the present petitions challenging the validity of the respective notices issued against them.

(2) The notices were admittedly issued under sub-section (1)(a) of section 34 and the main ground on which the validity of the notices was challenged was that having regard to the provisions of sub-sec. (1A) of sec. 34 the Income-tax Officer had no jurisdiction to issue notices to the petitioners under sub-sec. (1)(a) of sec. 34 in respect of the assessment years 1943-44 and 1946-47 for which the corresponding previous years fell wholly within the period 1st September 1939 to 31st March 1946 and that so far as the assessment year 1950-51 was concerned the condition precedent to the jurisdiction of the Income-tax Officer to issue notice under sub-sec. (1)(a) of sec. 34 was not satisfied and the Incometax Officer had therefore no jurisdiction to issue notices to the petitioners in respect of that assessment year. Now this ground depended primarily on the determination of the true scope and ambit of sub-secs. (1)(a) and (1A) of sec. 34 as they stood at the material time but in order to appreciate the implications and consequences of various arguments which have been addressed to us on this question of construction it is necessary to trace briefly the history of sec. 34 and to see how it stood at different points of time. Sec. 34 prior to its amendment in 1939 provided for a period of one year for bringing to tax income profits or gains escaping assessment in any year. In 1939 the whole section was substituted by another section which provided for the first time the limits of eight years and four years but it is not necessary to refer to the same since the section with which we are concerned is the section after its amendment by the Income-tax and Business Profits Tax (Amendment) Act 1948 This Act was passed on 8th September 1948 and it substituted a new section in place of the old and the material part of that section as subsequently amended by the Indian income-tax (Amendment) Act 1953 (which came into force from 1st April 1952) was as follows:

34 (1) If-

(a) the Income-tax Officer has reason to believe that by reason of the omission or failure on the part of an assessee to make a return of his income under sec. 22 for any year or to disclose fully and truly all material facts necessary for his assessment for that year income profits or gains chargeable for that year or have been under-assessed. or assessed at too low a rate or have been made the subject of excessive relief under the Act or excessive loss or depreciation allowance has been computed or

(b) notwithstanding that there has been no omission or failure as mentioned in clause (a) on the part of the assessee the Income-tax Officer has in consequence of information in his possession reason to believe that income profits or gains chargeable to income-tax have escaped assessment for any year or have been under-assessed or assessed at too low a rate or have been made the subject of excessive loss or depreciation allowance has been computed.

he may in cases falling under clause (a) at any time within eight years and in cases falling under clause (b) at any time within four years of the end of that year serve on the assessee or if the assessee is a company on the principal officer thereof a notice containing all or any of the requirements which may be included made a notice under sub-sec. (2) of sec. 22 and may proceed to assess or re-assess such income profits or gains or recompute the loss or depreciation allowance and the provisions of this Act shall so far as may be apply accordingly as if the notice were a notice issued under that sub-section:

Provided that:-

(1) the Income-tax Officer shall not issue a notice under this sub-section unless he has recorded his reasons for doing so and the Commissioner is satisfied on such reasons recorded that it is a fit case for the issue of such notice; .... ..... .....

(2) ..... ..... .....

(3) ..... ..... ...... Provided further that nothing in this section limiting the time within which any action may be taken or any order assessment or re-assessment may be made shall apply to a re-assessment made under sec. 27 or to an assessment or 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 sec. 31 sec 33 sec. 33A sec. 33B sec. 66 or sec. 66A".

Now simultaneous with section 34 there was in operation Taxation on Income (Investigation Commission) Act 1947 being Act XXX of 1947 passed by the Central Legislature in April 1947. Section 5(1) of the Act empowered the Central Government to refer to the Commission established under the Act for investigation and report any cases in which it had prima facie reason for believing that a person had to a substantial extent evaded payment of taxation on income. The date for making the reference was originally 30th June 1948 but it was subsequently extended to 1 September 1948. The Central Government could also refer to the Commission under section 5(4) cases of persons other than those whose cases had been referred to it under sec. 5(1) if after investigation the Commission made a report to that effect. The procedure prescribed by the Act for making investigation under its provisions was of a summary and drastic nature. It constituted a departure from the ordinary law of procedure and in certain important aspects was detrimental to the persons subjected to it and as such was discriminatory. The validity of section 5(4) was therefore challenged in Suraj Mall Mohta v. Sri A. V. Visvanatha Sastri (1954) 26 I.T.R. 1 and the Supreme Court struck down that provision as infringing the guarantee of the equal protection of the laws contained in Article 14 of the Constitution. During the course of the discussion in Suraj Mall Mohtas case in the Supreme Court certain defects were pointed out in the classification made under sec 5(1) The Parliament therefore tried to remedy these defects when it enacted consequent upon the decision in Suraj Mall Mohtas case Indian Incometax (Amendment) Act 1954 introducing by way of amendment the following sub-sections as sub-secs. (1A) and (1B) in sec. 34:

"(1A). If in the case of any assessee the Income-tax Officer has reason to believe-

(i) that income profits or gains chargeable to income-tax have escaped assessment for any year in respect of which the relevant previous year falls wholly or partly within the period beginning on the 1st day of September 1939 and ending on the 31st day of March 1946 and

(ii) that the income profits or gains which have so escaped assessment for any such year or years amount or likely to amount to one lakh of rupees or more; he may notwithstanding that the period of eight years or as the case may be four years specified in sub-sec. (1) has expired in respect thereof serve on the assessee or if the assessee is a company on the principal officer thereof a notice containing all or any of the requirements which may be included in a notice under sub-sec. (2) of sec. 22 and may proceed to assess or reassess the income profits or gains of the assays for all or any of the years referred to in clause (i) and thereupon the provisions of this Act excepting those contained in clauses (i) and (iii) of the proviso to sub-sec. (1) and in sub-secs. (2) and (3) of this section shall so far as may be apply accordingly:

Provided that the Income-tax Officer shall not issue a notice under this sub section unless he has recorded his reasons for doing so and the Central Board of Revenue is satisfied on such reasons recorded that it is a fit case for the issue of such notice:

Provided further that no such notice shall be issued after the 31st day of March 1956

(1B). Where any assessee to whom a notice has been issued under sub-section .(1A) applies to the Central Board of Revenue at any time within six months from the receipt of such notice or before the assessment or reassessment is made whichever is earlier to have the matters relating to his assessment settled the Central Board of Revenue may after considering the terms of settlement proposed and subject to the previous approval of the Central Government accept the terms of such settlement and if it does so. shall make an order in acredance with the terms of such settlement specifying among other things the sum of money payable by the assessee.

... . .. . .. . .. . .. . .. This Act by which sub-secs. (1A) and (1B) were added in sec. 34 received the assent of the President on 5th September 1954 but it was brought into effect from 17th July 1954 and sub-secs. (1A) and (1B) therefore came into force from 17th July 1954. By this Act certain other subsections namely sub-secs. (1C) and (1D) were also added in sec. 34 but it is not necessary to refer to them since they have no bearing on the determination of the problem before us. This state of affairs continued upto 1st April 1956 when certain further amendments of a rather farreaching character were made in sec. 34 by the Finance Act 1956 The time limit of eight years in sub-section (1) in respect of cases falling within clause (a) was removed and the following provisos were substituted for the existing proviso in sub-sec.(1):- Provided that the Income-tax Officer shall not issue a notice under clause (a) of sub-sec. (1)

(i) for any year prior to the year ending on the 31st day of March 1941;

(ii)for any year if eight years have elapsed after the expiry of that year unless the income profits or gains chargeable to income-tax which have escaped assessment or have been under-assessed or assessed at too low a rate or have been made the subject of excessive relief under this Act or the loss or depreciation allowance which has been computed in excess amount to or are likely to amount to one lakh of rupees or more in the aggregate either for that year or for that year and any other year or years after which or after each of which eight years have elapsed not being a year or years ending before the 31st day of March 1941

(iii) for any year unless he has recorded his reasons for doing so and in any case falling under clause (ii) unless the Central Board of Revenue and in any other case the Commissioner is satisfied on such reasons recorded that it is a fit case for the issue of such notice:

Sub-sec. (1B) was also amended by the substitution of the words to whom a notice has been issued under clause (a) of sub-sec. (1) or under sub-sec. (1A) for any of the year ending on the 31st day of March of the years 1941 to 1948 inclusive for the existing words to whom a notice has been issued under sub-sec. (1A) . On the section so amended the question arose whether after the deletion of the time limit of eight years is cases involving escarpment of income exceeding Rs. 1 lac a notice could issue under sub-sec. (1)(a) even though such notice was time-barred by reason of the expiration of the period of eight years at the date when the amendment made by the Finance Act 1956 came into force. The High Court of Calcutta held in Debi Dutta v. T. Bellan A.I.R. 1959 Calcutta 567 that once the right of the Income-tax Officer to proceed under sub-sec. (1)(a) as it stood prior to its amendment by the Finance Act 1956 was barred by reason of the expiration of the period of eight years it was not revived by the deletion of the time limit of eight years from sub-sec. (1)(a). This decision led to the passing of an Ordinance and later the Indian Income-tax (Amendment) Act 1959 This Amending Act added sub-sec. (4) to sec. 34 providing forissue of notice under sub-sec. (1)(a) at any time notwithstanding the expiration of the period of eight years provided under the section as it stood prior to its amendment by the Finance Act 1956 and also enacted sec. 4 in the following terms for validation of notices issued prior to the commencement of the Amending Act:

"No notice issued under clause (a) of sub-sec. (1) of sec. 34 of the principal Act at any time before the commencement of this Act and no assessment reassessment or settlement made or other proceeding taken in consequence of such notice shall be called in question in any Court tribunal or other authority merely on the ground that at the time the notice was issued or at the time the assessment or re-assessment was made the time within which such notice should have been issued or the assessment or re-assessment should have been made under that section as in force before its amendment by clause (a) of sec. 18 of the Finance Act 1956 had expired".

These were the relevant provisions of sec. 34 as they stood from time to time after undergoing various amendments which we have set out above.

(3) Now the impugned notices were issued by the respondent on 31st January 1962 and the question which therefore arises for consideration is whether after the amendment by the Finance Act 1956 a notice can be issued under sub-sec. (1)(a) of sec. 34 for reopening an assessment for any of the assessment years covered by sub-sec. (1A) of sec. 34 when no notice for reopening such assessment was issued under sub-sec. (1A) of sec. 34 on or before 31st March 1956. In order to arrive at a proper determination of the question it is necessary first to consider the scope and ambit of sub-sections (1)(a) and (1A) of sec. 34 as they stood immediately prior to the amendment by the Finance Act 1956 and then to examine the effect of the amendment on those sub-sections.

(4) Sec. 34 as it stood immediately prior to its amendment by the Finance Act 1956 was the section as amended on 17th July 1954 by the insertion inter alia of sub-sections (1A) and (1B). The effect of the amendment of 17th July 1954 was that with effect from that date we had two sub-sections in sec. 34 empowering the Income-tax Officer to reopen assessments in certain cases. One was sub-sec (1) which consisted of two clauses namely (a) and (b)-and we are here concerned with only clause (a)-and the other was sub-sec (1A). The argument of Mr. I. M Nanavati based on the provisions of these two sub-sections was that sub-sec. (1)(a) was a general provision applicable to all assessment years while sub-sec. (1A) was a special provision applicable only to those assessment years in respect of which the relevant previous years fell wholly or partly within the period the 1st September 1939 to 31st March 1956 and that the general provision in sub-sec. (1)(a) must therefore in accordance with the maxim generalia specialibus non derogant be held applicable only to those cases which were not covered (b) the special provision in sub-sec. (1A). He contended that the scope and ambit of sub-sec. (1)(a) did not extend to escaped income of what may be conveniently described as the war years for which special provision was made in sub-sec. (1A) and that consequently sub-sec. (1)(a) could not be invoked by the revenue for bringing to tax escaped income of war years which could be caught at only by proceeding under sub-sec. (1A). The learned Advocate General did not dispute the correctness of the rule of interpretation embodied in the maxim generalia specialibus non derogant but he contended that there was no scope for the application of that rule of interpretation in the present case because neither sub-sec. (1)(a) was a general provision nor was sub-sec. (1A) a special provision. He urged that both sub-sections operated simultaneously and if at any point of time the conditions of either sub-section were fulfilled such sub-section could be availed of by the Income-tax Officer for reopening the assessment of the assessee even if the conditions of the other sub-sections were not satisfied and the Income-tax Officer could not therefore proceed under that sub-section. The question raised by these rival contentions was a rather crucial question for as we shall point out later if sub-sec. (1A) was a special provision which excluded the applicability of sub-sec. (1)(a) to cases covered by sub-sec. (1A) as contended on behalf of the petitioners it is difficult to see how any removal of the time-limit of eight years in subsec. (1)(a) could alter the position and bring within the scope and ambit of sub-sec. (1)(a) cases covered by sub-sec. (1A) when sub-sec. (1A) still continued on the statute book as a valid provision. The question was therefore seriously debated and considerable argument was expended upon it.

(5) On an analysis of the provisions of sub-sections (1)(a) and (1A) it is clear that sub-section (1)(a) is a general provision and subsection (1A) is a special provision. Once an assessment is made and it has become final and conclusive it is elementary that in the absence of an express provision to the contrary it cannot be reopened. Section 34 was therefore enacted to give power to the Incometax Officer to reopen an assessment which had already become final and conclusive. The power was conferred under sub-section (1) by two clauses namely (a) and (b). We are concerned in these petitions with sub-section (1)(a) and we will therefore refer only to sub-section (1)(a) but what we say here in regard to sub-section (1)(a) must apply equally to sub-sec (1)(b). Sub-section (1)(a) empowered the Income-tax Officer to reopen the assessment of any assessment year without limiting it to any particular assessment year or years and it was clearly a general provision intended to apply to every assessment year. Of course certain conditions were prescribed which were required to be fulfilled before action could be taken under sub-sec. (1)(a) but they operated in respect of every assessment year and so did the period of limitation of eight years provided by the sub-section. The assessment in respect of any assessment year including the assessment years for which the relevant previous years fell wholly or partly within the war period could be reopened under sub-section (1)(a) provided the conditions specified in the sub-section were Satisfied and notice was issued within the prescribed period of eight years There was also no limitation as regards the amount of income which should have escaped assessment before action could be taken under sub-section (1)(a) for reopening the assessment. Sub-section (1A) however operated on a narrower field and was limited in its application to certain specified assessment years in respect of which the relevant previous years fell wholly or partly within the period 1st September 1939 to 31st March 1946 being the period of the second world war and that too only in those cases where the income alleged to have escaped assessment amounted or was likely to amount to Rs. 1 0 0 or more. Sub-section (1A) enacted a self-contained provision for bringing to tax escaped income of those assessment years when such escaped income amounted or was likely to amount to Rs. 1 0 0 or more providing distinct conditions on its own for taking action for assessment or re-assessment of such escaped income and providing its own distinct period of limitation for initiating such action. The restrictive conditions which were required to be fulfilled for taking action under sub-section (1)(a) or (1)(b) were omitted from sub-section (1A) and no condition precedent was prescribed for taking action under sub-section (1A) beyond the broad general requirement that the Income-tax Officer must have reason to believe that the income chargeable to income-tax has escaped assessment. The limitation of time to be found in sub-sections (1)(a) and (1)(b) was also removed and instead an outside limit was provided namely 31 March 1946 outside of which no action could be taken under sub-section (1A). This outside limit was so inexorable that the second proviso to sub-section (3) which relaxed the time limit for taking action in certain cases was by the express terms of sub-section (1A) not made applicable to cases covered by sub-section (1A) and the outside limit could not therefore under any circumstances be infringed. The safeguard provided to the assessee against unnecessary harassment was also improved in the sense that instead of the satisfaction of the Commissioner of Income-tax required for taking action under sub-section (1)(a) or (1)(1b) the satisfaction of a higher revenue authority namely the Central Board of Revenue was required to be obtained before taking action under sub-section (1A). An additional facility was also given to the assessee against whom notice was issued under sub-section (1A) and such an assessee could under sub-section (1B) apply to the Central Board of Revenue for settlement of the matters relating to assessment unlike an assessee proceeded against under sub-section (1)(a) or (1)(h) It is clear from these circumstances that sub-section (1A) constituted a self-contained code dealing with a special class of taxevaders namely those who had evaded payment of tax on income exceeding Rs. 1 0 0 earned by them during the war years and for that class special conditions were prescribed and special treatment was given by the sub-section. Sub-sec. (1A) was therefore clearly a special provision as against the general provision contained in sub-sec. (1)(a).

(6) . We must also in this connection refer to another circumstance relied on by Mr. I. M. Nanavati in support of his contention that the provision contained in sub-sec. (1A) was a special provision. He contended that whereas sub-sec. (1)(a) empowered the Income-tax Officer to take action when he had reason to believe that income had escaped assessment or had been under-assessed or assessed at too low a rate or had been made the subject of excessive relief under the Act or excessive loss or depreciation allowance had been computed action under sub-sec. (1A) could be taken only in cases where income had escaped assessment He of course agreed that a case of under-assessment resulting from escapement of a part of the income from assessment was covered by sub-sec. (1A) because what was escapement of a part of the income from assessment was also under-assessment from the point of view of the total income. He however urged that other cases of under-assessment which did not involve escapement of a part of the income from assessment and cases where income was assessed at too low a. rate or had been made the subject of excessive relief under the Act or where excessive loss or depreciation allowance had been computed were not within the compass of sub-sec. (1A) and sub-sec. (1A) inasmuch as it operated on a field more limited than that occupied by sub-section (1)(a) was a special provision. This contention would have involved an interpretation of the true connotation of the expression income profits or gains chargeable to income-tax have escaped assessment in sub-sec. (1A) but we do not find it necessary to do so in the present cases since it was also the contention of the learned Advocate General that that expression did not include within its scope and ambit cases where income had been assessed at too low a rate or had been made the subject of excessive relief under the Act or where excessive loss or depreciation allowance had been computed. The learned Advocate General as a matter of fact argued that escapement of income from assessment within the meaning of sub-sec. (1A) did not include even a case of under-assessment and that it referred only to cases where income had escaped assessment by reason of not having suffered taxation. This last contention of the learned Advocate General is however not right for it is clear that under-assessment of total income resulting from a part of the income having escaped assessment would be covered by sub-section (1A) because though it is under-assessed when looked at from the point of view of total income it is certainly escapement from assessment so far as the part of the income which escapes assessment is concerned. In view of this position adopted by the parties we propose to proceed on the basis that sub-section (1A) applied only to cases which there was escapement of income from assessment whether such escapement resulted in under-assessment or not. But if this be so it certainly supports the contention of Mr. I. M. Nanavati that sub-section (1A) was a special provision inasmuch as it dealt with a more limited class of cases than those covered by the general provision contained in sub-section (1)(a). We may however point out that this is only one of the many factors which we have taken into account for the purpose of reaching the conclusion that sub-section (1A) was a special provision and we do not wish to place any undue reliance on it or to overemphasize its importance.

(7) The preamble of the Indian Income-tax (Amendment) Act 1954 which introduced sub-sec. (1A) in sec. 34 also leads to the same conclusion. The preamble stated that the Act was intended to provide for assessment or reassessment of persons who to a substantial extent had evaded payment of tax during a certain period and for matters connected therewith and with that object in view the Act introduced sub-sec. (1A) in section 34. The period referred to in the preamble as certain period was particularized in sub-section (1A) as the war period namely 1 September 1939 to 31st March 1946 and what was meant by the word substantial was made clear in the sub-section by providing that it should apply where the Income-tax Officer had reason to believe that the income which has escaped assessment amounted or was likely to amount to Rs. 1 0 0 or more. It is therefore clear that sub-section (1A) was introduced for the purpose of providing for assessment or reassessment of persons who had evaded payment of tax on income of Rs. 1 0 0 or more earned by them during the war period. This would certainly constitute sub-section (1A) a special provision in regard to assessment or re-assessment of those persons.

(8) The circumstances under which sub-sec. (1A) came to be introduced in section 34 also lend strong support to the view which we are taking. Sub-section (1A) was introduced as a result of the decision of the Supreme Court in Suraj Mall Mohtas case. Now at the date when sub-sec. (1A) was introduced section 5(1) of Act XXX of 1947 was on the statute book. The vires of section 5(1) was challenged before the Supreme Court in Meenakshi Mills v Sri A. V. Visvanatha Sastri (1954) 26 I.T.R. 713 on the ground that it subjected the same class of persons who were dealt with by sub-section (1A) to the discriminatory procedure provided by Act XXX of 1947. The challenge was upheld and the Supreme Court held that sub-section (1A) dealt with the same class of persons who came within the scope of section 5(1) and section 5(1) had therefore become void on the introduction of sub-sec. (1A) in section 34 as violating the guarantee of Article 14 of the Constitution. Mahajan C.J. speaking on behalf of the Supreme Court observed:

"......Further it seems that this very class of persons is now included within the ambit of the amended section 34 of Act XXXIII of 1954 It is thus clear that the new sub-section inserted in sec 34 by the provisions of Act XXXIII of 1954 is intended to deal with the class of persons who were said to have been classified for special treatment by section 5(1) of Act XXX of 1947".

The Supreme Court in the subsequent decision in Thangal Kunju Musaliar v. Venkatachalam Potti (1956) 29 I.T.R. 349 after referring to the decision in Meenakshi Mills case said:

"Section 34(1A) purported to meet two criticisms which had been in the main offered against the constitutionality of section 5(1) of the Act in Suraj Mall Mohtas case. One criticism was that the classification made in section 5(1) of the Act was bad because the word substantial used therein was a word which had no fixed meaning and was an unsatisfactory medium for carrying the idea of some ascertainable proportion of the whole and thus the classification being vague and uncertain did not save the enactment from the mischief of article 14 of the Constitution. That alleged defect was cured in section 34(1A) inasmuch as the Legislature clearly indicated there what it meant when it said that the said object of Act XXX of 1947 was to catch persons who to a substantial extent had evaded payment of tax in other words what was seemingly indefinite within the meaning of the word substantial had been made definite and clear by enacting that no evasion below a sum of one lakh was within the meaning of that expression. The other criticism was that section 5(1) did not necessarily deal with the persons who during the war had made huge profits and evaded payment of tax on them. Section 34(1A) remedied this defect also. It clearly stated that it would operate on income made between the 1st September 1939 and 31st March 1946 tax on which had been evaded. Section 5(1) was again attacked in the case of Shree Meenakshi Mills Ltd. v Sri A. V. Visvanatha Sastri and Another. This was a petition under article 32 of the Constitution filed on the Lets 16th July 1954 after the decision in Suraj Mall Mohtas case had been pronounced. Section 5(1) of the Act was attacked on the very same grounds which were mentioned in the judgment in Suraj Mall Mohtas case but had not been dealt with by this Court it being considered sufficient to strike down section 5(4) of the Act without expressing any opinion on the vires of section 5(1). Even in this case. section 5(1) was not struck down as void on a comparison of its provisions with those of section 34(1) of the Indian Incometax Act as was done in the case of section 5(4) in Suraj Mall Mohtas case By the time this petition came to be heard by this Court the Parliament had enacted Act XXXIII of 1954 which as stated above introduced section 34(1A) in sec 34 of the Indian Income-tax Act and this Court came to the conclusion on a comparison of the provisions of sec. 5(1) of the Act with sec. 34(1A) of the Indian Income-tax Act that the new sub-section inserted in section 34 by Act XXXIII of 1954 was intended to deal with the class of persons who were said to have been classified for special treatment by sec. 5(1) of Act XXX of 1947".

These observations of the Supreme Court clearly show that the class of assesses which was selected for special treatment by section 5(1) of the Act XXX of 1947 was dealt with by sub-sec. (1A) after the introduction of that sub- section in sec. 34 with this modification that defects of classification which were alleged to exist in sec. 5(1) were cured by the basis of classification being made more definite and if that be so the conclusion is irresistible that sub-sec. (1A) was enacted as a special provision and must be construed as such.

(9) Mr. I. M. Nanavati also cited a decision of the Allahabad High Court in Jai Kishan Srivastava v. Income-Tax Officer (1960) 40 I.T.R. 222. In that case the vires of sub-sec. (1A) was challenged on the ground that it was discriminatory and violated the Constitutional guarantee contained in Article 14 of the Constitution. The validity of the sub-section was however upheld by the Pull Bench of the Allahabad High Court and Bhargava J. in the course of his judgment made the following observations in regard to the scope and purpose of the sub-section:

"...It is to be noticed that even though there is a common class of asses sees who can be proceeded against under both sec 34(1) as well as sec. 34(1A) of the Act the latter provision is applicable to a limited class of persons. That class of persons are those whose income profits or gains had escaped assessment for any year in respect of which the relevant previous year fell wholly or partly within the period beginning on the 1st day of September 1939 and ending on March 31 1946 Then there was a second limitation that the income profits or gains which have so escaped assessment must be believed by the Income-tax Officer to be likely to amount to one lakh of rupees or more. It seems to me that having picked out such a narrow class the Legislature made a special provision under sec. 34(1A) of the Act for taking proceedings against that class of persons without being limited by any period of Limitation and by this all that the Legislature did was to enlarge the period of limitation in their cases. Once it has been held that proceedings for assessment under sec. 34(1) as well as under sec. 34(1A) of the Act in the matter of procedure right of appeal etc. are identical sec. 34(1A) has to be read as an exception to section 34 of the Act whereby the limitation applicable to the larger class of persons who could be dealt with under sec. 34(1) of the Act has been done away with for a smaller class of persons. It is therefore in the nature of an exception specifically for the purpose of enlarging the period of limitation or doing away with the limitation in the case of a limited and narrower class. This narrower class as indicated by the language of section 34(1A) of the Act consisted of assesses who had earned income during the war period and who had evaded payment of tax on incomes of one lakh of rupees or more and the purpose of introducing this provision was to subject their escaped income to tax ".

We are in entire agreement with these observations and they completely support the contention of Mr. I. M. Nanavati that sub-section (1A) contained a special provision as against the general provision contained in sub-sec. (1) clauses (a) and (b). The decision of the Calcutta High Court in M. M. Ispahani Ltd. v. Union of India (1961) 43 I T.R. 58 which was the other decision cited by Mr. I. M. Nanavati also contains observations to the same effect and it is therefore not necessary for us to make a detailed reference to the same.

(10) If sub-section (1A) was a special provision in regard to reopening of assessment of assessment years in respect of which the relevant previous years fell wholly or partly within the war period where income that had escaped assessment was Rs. 1 0 0 or more and sub-section (1)(a) was a general provision in regard to reopening of assessment of all assessment years on what principle of interpretation must the scope and ambit of the two provisions be determined The answer is supplied by the maxim generalia specialibus non derogant. This maxim has been the subject of an almost bewildering mass of authorities and the reasons given in support of it have differed some what in expression from time to time probably because more reasons than one can be given. But it is now well-settled that where there is a special provision as well as a general provision in a statute. and the case is covered by the special provision it is the special provision which must govern the case and not the general provision. The rule springs from the common understanding of men that when the same person gives two directions one covering a large number of matters in general and another only some of them his intention is that the latter direction should prevail as regards these while as regards all the rest the earlier direction should have effect. (J. K. Cotton Spinning and Weaving Mills Co. Ltd. v. State of Uttar Pradesh A. I. R. 1961 S. C. 1170 at 1174). Quain J. stated the rule thus in the following passage from his Judgment in Dryden v. Overseers of Putney (1876) 1 Exchequer Division 223 which has now become classical and is oft quoted:

"...It may be laid down as a rule for the construction of statutes that where a special provision and a general provision are inserted which cover the same subject-matter a case falling within the words of the special provision must be governed thereby and not by the terms of the general provision".

Now in the present case as we have already pointed out above the general provision in sub-section (1)(a) covered the entire field occupied by the special provision in sub-section (1A) inasmuch as it applied to all assessment years including the assessment years dealt with by sub section (1A) irrespective of the question whether the income that had escaped assessment was less than Rs. 1 0 0 or Rs. 1 0 0 or more. The general intention expressed in sub-section (1)(a) being that no assessment in respect of an assessment year should be reopened unless the conditions therein specified were fulfilled and notice was issued within a period of eight years if sub-section (1)(a) applied to escaped income of assessment years dealt with by sub-section (1A) when such escaped income amounted to Rs 1 0 0 or more the consequence would be that assessment in respect of those assessment years could not be reopened if the conditions specified in sub-section (1)(a) were not fulfilled or the period of eight years had expired before issue of notice. But sub-section (1A) declared that such consequence should not ensue and that though the conditions specified in sub-section (1)(a) were not fulfilled and though the period of eight years had expired before issue of notice assessment in respect of those assessment years should be liable to be reopened if certain other conditions were fulfilled and notice was issued before 31st March 1956. Sub-section (1A) thus clearly indicated a particular intention incompatible with the general intention expressed in sub-section (1)(a) and this incompatibility was emphasized by the non obstinate clause in the opening part of sub-section (1A). The general provision in sub-section (1)(a) was therefore having regard to the aforesaid rule of interpretation inapplicable to cases covered by the special provision in sub-section (1A). Such cases were governed exclusively by sub-section (1A) and the general words of sub-section (1)(a) could not be availed of for the purpose of reopening assessment in such cases. (vide Koka Ram v. Salig A.I.R. 1928 Allahabad 536; Bhana Makan v. Emperor A. I. R. 1936 Bombay 256; Vithalji Madhavji v. Commissioner of Income-tax A. I. R. 1948 Madras 353 and Subhodh Chandra Popatlal v. Commissioner of Income-tax A. I. R. 1954 Bombay 234).

(11) The next question that arises is as to what is the effect of the amendment made by the Finance Act 1956 The argument of Mr. I. M. Nanavati on this part of the case was that even after the amendment sub-section (1A) continued on the statute book as a valid provision and operated in all its fullness and since it was a special provision so long as it continued to operate Subsection (1)(a) which was a general provision could not be availed of for taking action in cases covered by sub-section (1A) even though the time limit of eight years was removed by the amendment. He urged that there was no express repeal of subsec. (1A) by the amendment nor did the amendment have the effect of abrogating sub-sec. (1A) and sub-sec. (1A) therefore continued as an operative provision and excluded the applicability of sub-sec. (1)(a) to cases covered by sub-sec. (1A). The learned Advocate General in answer reiterated the same contention which he had urged in regard to the period prior to the amendment and said that neither sub-sec. (1)(a) was a general provision nor sub-sec. (1A) a special provision and there was therefore no question of the latter operating to the exclusion of the former. He also contended that in any view of the matter sub-sec (1A) ceased to be operative effectively from and after 1st April 1956 and though it remained on the statute book as a valid provision it could not be availed of for future action against an assessee in respect of the escaped income of war years and the new sub-sec. (1)(a) could therefore be utilised for taking action against an assessee in respect of the escaped income of war years. He also relied on sub-sec. (1B) and particularly the substitution of the words clause (a) of sub-sec. (1) or under sub-sec. (1A) for any of the years ending on the 31st day of March of the years 1941 to 1948 in that sub-section and contended that those words clearly indicated that after the amendment a notice under sub-sec. (1)(a) could be issued even in respect of the assessment years covered by sub-section (1A). This he submitted was the only possible view of the provisions in sub-sections (1)(a) and (1A) on the principle of harmonious construction. These were broadly the rival constructions and what we have to decide is which of them is correct.

(12) One thing is clear that sub-section (1)(a) which was a general provision prior to the amendment continued to be a general provision even after the amendment for all that the amendment did was merely to remove the time limit of eight years in certain cases depending upon whether the income that had escaped assessment beyond the period of eight years amounted to Rs. 1.00 0 or more and sub-section (1)(a) as amended applied generally to all assessment years including the assessment years dealt with by sub-section (1A) and provided certain conditions were satisfied assessment in respect of any assessment year barring only the assessment years prior to the assessment year ending on 31st March 1941 could be reopened under that sub-section at any time regardless of any time limit. Sub-section (1A) which was a special provision in regard to reopening of assessment of assessment years for which the corresponding previous years fell wholly or partly within the war period where income that had escaped assessment was Rs. 1 0 0 or more was not repealed but was continued on the statute book and if it was a special provision prior to the amendment for the same reasons it must be regarded as a special provision subsequent to the amendment. The result was that after the amendment we had two provisions in sec. 34 for reopening assessments one a general provision in sub-sec. (1)(a) and the other a special provision in sub-sec (1A). In regard to the assessment years for which the corresponding previous years fell wholly or partly within the war period where the escaped income of the war years was Rs. 1 0 0 or more the position was that if the general provision in sub-section (1)(a) applied assessment in respect of any of those assessment years could be reopened at any time from and after 1st April 1956 provided the conditions specified in sub-section (1)(a) read with the proviso were fulfilled but if the special provision in sub-section (1A) applied such assessment could not be reopened after 31se March 1956. The general intention expressed in sub-section (1)(a) was thus clearly incompatible with the particular intention indicated in the special provision in sub-section (1A) and the general provision in sub-section (1)(a) must therefore be construed as operating on cases other than those covered by the special provision in sub-sec. (1A) on the principle of interpretation embodied in the maxim generalia specialibus non derogant to which we have already referred. The construction suggested by the learned Advocate General would not only involve a disregard of this principle of interpretation but would also have the effect of rendering sub-sec. (1A) meaningless and superfluous. If the Legislature did not intend that after the amendment subsec. (1A) should continue to have any force or vitality the Legislature could have easily repealed that sub-section. The pending proceedings under that sub-section would not have been affected because sec. 6 of the general Clauses Act 1897 would have saved them and even if there was any such apprehension it could have been laid at rest by enacting a saving proviso which is a legislative device not altogether unfamiliar to the Legislature. It is however significant that the Legislature continued the special provision in sub-sec. (1A) and the only reason which can be attributed to the Legislature for doing so is that the Legislature intended that sub-sec. (1A) should continue as an operative provision in regard to cases covered by it. Sub-section (1A) did not cease to be in force or become a dead-letter after the amendment. It may be that the outside limit of 31st March 1956 having elapsed assessment could not be reopened in cases covered by sub-section (1A) but that would be a very much different thing from saying that sub-sec (1A) ceased to be operative on the coming into force of the amendment. As a matter of fact it is because sub-sec. (1A) continued to be operative after the amendment that assessment in cases covered by sub-sec. (1A) could not be reopened after 31st March 1956 and apparently it was with a view to achieving this result that the Legislature continued sub-sec (1A) as an operative provision. Since sub-section (1A) continued as an operative enactment making a special provision in regard to cases covered by it full meaning and effect must be given to it and the only way in which this can be done is by reading the general provision in sub-sec. (1)(a) as applicable to cases other than those covered by the special provision in sub-section (1A).

(13) This question can also be looked at from another point of view. When amendment was made in sub-sec. (1)(a) the effect was as if subsec. (1)(a) was re-enacted in the amended form. Did the re-enactment of sub-sec. (1)(a) in the amended form have the effect of impliedly repealing sub-sec. (1A) Though the learned Advocate General stated he did not rely on the principle of implied repeal but based his argument only on the principle of harmonious construction the effect of the argument must be that sub-section (1A) was impliedly repealed by the amendment made in sub-sec. (1)(a) i. e. by the re-enactment of sub-sec. (1)(a) in the amended form. Whether it is said that sub-sec. (1A) was abrogated by the amended sub-section (1)(a) or that it ceased to be operative after the amendment of sub-section (1)(a) or that it was impliedly repealed by the amendment made in sub sec. (1)(a) is one and the same thing. Now it is well-settled that where there are general words in a later Act capable of reasonable and sensible application without extending them to subjects specially dealt with by earlier legislation you are not to hold that earlier and special legislation indirectly repealed altered or derogated from merely by force of such general words without any indication of a particular intention to do so. (Earl of Selborne L. C. in Seward v. Vera Cruz 10 Appeal Cases 59 at 68). In such a case the general words are presumed to have only general cases in view and not particular cases which have already been otherwise provided for by the special legislation. Having already given its attention to the particular subject and provided for it the legislature is reasonably presumed not to intend to alter that special provision by a subsequent general enactment unless that intention be manifested in explicit language or there be something which shows that the attention of the Legislature had been turned to the special legislation and that the general one was intended to embrace the special cases provided for by the previous one. In the absence of these conditions the general enactment trust be read as silently excluding from its operation cases which have been provided for by the special one. (See Maxwell on Interpretation of Statutes Eleventh Edition 169 Examining the question in the light of these principles it is clear that there was no implied repeal or abrogation of sub-section (1A) by the general words of the amended sub-sec. (1)(a). The general words of the amended sub-sec. (1)(a) must be read as silently excluding from their operation the cases already provided for in the special provision contained in sub-sec. (1A). We do not find any indication of an intention on the part of the Legislature that the general provision in the amended sub-sec. (1)(a) should override or prevail against the special provision in sub-section (1A) in cases covered by the latter sub-section. On the contrary as we have already pointed out above the indication is the other way round and that is manifested clearly by the continuance of the special provision in sub-sec. (1A).

(14) We must then consider as to whether the substitution of the words clause (a) of sub-section (1) or under sub-section (1A) for any of the years ending on the 31st day of March of the years 1941 to 1948 in sub-section (1B) had the effect of setting at naught the provisions of sub-section (1A). It is no doubt true that sub-section (1B) talks of a notice issued under sub-section (1)(a) for any of the years ending on the 31st day of March of the years 1941 to 1948 and that some meaning must be given to those words. But if those words tan be given a reasonable and sensible application without rendering them meaningless or ineffective then they cannot be relied upon as indicating a legislative intent to abrogate sub-section (1A). If the effect of accepting the construction contended for on behalf of the petitioners were to render those words totally meaningless and superfluous a question might arise whether those words should be discarded as superfluous and unnecessary or whether from the mere use of those words a legislative intent should be gathered that sub-section (1A) was intended to be abrogated though it was continued on the statute-book but we find that there are at least two cases in which the terms of sub-section (1B) could be satisfied by the issue of a notice under sub-section (1)(a) even on the construction of the petitioners. The first is the case of an assessment years covered by sub-section (1A) where it is found that income was assessed at too low a rate or had been made the subject of excessive relief or loss or depreciation allowance had been computed at an excessive amount such a case would not be covered by sub-section (1A) and a notice could be issued in such a case under sub-section (1)(a). equally if there was escapement of income from assessment for the accounting years 1946-47 for which the assessment year would be 1947-48 and the escaped income for the assessment years beyond the period of eight years amounted to or was likely to amount to Rs. 1 0 0 or more notice could be issued under sub-section (1)(a) for bringing to tax escaped income of the assessment year 1947-48 and such a case would not be covered by subsection (1A) since the accounting year 1946-47 would not fall wholly or partly within the war period. These are certainly two cases in which the assessee would be entitled to approach the Central Board of Revenue for settlement under sub-section (1B) and the words substituted in subsection (1B) would have meaning and effect. It is therefore not possible to -say that these words in sub-sec. (1B) would be rendered meaningless or superfluous if the construction contended for on behalf of the petitioners were accepted and that the construction suggested on behalf of the Revenue should therefore be preferred. We may also in this connection refer to the following passage from the decision given by the Madhya Pradesh High Court on 25th November 1963 in Miscellaneous Petition No. 385 of 1962 in Rustomji Jall v. Income-tax Officer which in our opinion provides an effective refutation of the present contention of the learned Advocate General: If Parliament did really intend that even after 31st March 1956 a notice for the reopening of an assessment should be given under clause (a) of sub-sec. (1) for any of the years ending on 31 March of the years 1941 to 1946 then they would have expressed their intention clearly by suitably amending S8C. 34(1) for that purpose or by repealing sub-sec. (1A) and not concealed it with a more than Baconian obscurity in a provision dealing with settlement of assessments. This contention of the learned Advocate General based on the substitution of words effected in sub-sec. (1B) by the Finance Act 1956 must therefore be rejected.

(15) There is also another circumstance which strongly supports the contention of Mr. I. M. Nanavati. It is now settled by the decision of the Calcutta High Court in Debi Dutta v. T. Bellan (supra) and the decision of the Bombay High Court in S. C Prashar v. Vasantsen (1955) 58 Bom. L. R. 184 that if the right of the Incometax Officer to reopen an assessment is barred under the law for the time being in force no subsequent enlargement of the time can revive such right in the absence of express words or necessary intendment. The decision of the Bombay High Court was of course taken it appeal and was reversed by the Supreme Court but on this point out of five Judges two Judges expressed one view two Judges expressed another view and the fifth Judge did not express any opinion at all with the result that the decision of the Bombay High Court stands so far as this point is concerned. In order to get over this difficulty when it was pointed out by the Calcutta High Court in Debi Dutta v. Bellan (supra) the Legislature added sub-sec. (4) to sec. 34 providing that a novice under sub-section (1)(a) may be issued at any time notwithstanding the expiration of the period of eight years specified in that sub-section as it stood prior to its amendment by the Finance Act 1956 The effect of this provision was that even if the right of the Income-tax Officer to reopen an assessment under sub-sec. (1)(a) as it stood prior to its amendment by the Finance Act 1956 was barred by reason of the expiration of the period of eight years at the date when the amendment came into force the Income-tax Officer could after the amendment issue notice at any time for reopening such assessment under sub-sec. (1)(a). Now it is significant that while adding subsection (4) the Legislature did not introduce any provision reviving the right of the Income-tax Officer to reopen an assessment in cases covered by sub-sec. (1A). Reopening of assessment in such cases being governed exclusively by sub-sec. (1A) as already held by us the right of the Income-tax Officer to reopen assessment in such cases would be barred on the midnight of 31st March 1956 that being the outside limit beyond which action could not be taken under that sub-section. The newly added sub-sec. (4) could not be relied upon by the Revenue for reviving the right of the Income-tax Officer to take action in such cases because that sub-section operated to revive the right to reopen assessment which was barred by reason of the expiration of the period of eight years specified in sub-section (1)(a) before its amendment by the Finance Act 1956 and not by reason of the expiration of the outside limit of 31st March 1956 specified in sub-sec. (1A). If therefore the Legislature intended that notwithstanding the expiration of the outside limit of 31st March 1956 specified in sub-sec. (1A) the Income-tax Officer should be able to issue notice under the amended sub-sec. (1)(a) in cases covered by sub-section (1A) the Legislature would have enacted a provision similar to sub-sec. (4) providing for issue of notice under sub-sec. (1)(a) at any time notwithstanding the expiration of the outside limit of 31st March 1956 specified in sub-sec. (1A). No such provision was however made by the Legislature and far from making such provision the Legislature retained sub-sec. (1A) along with the second proviso which prescribed the outside limit of 31st March 1956. This circumstance is clearly indicative of the legislative intent that no notice in respect of cases covered by sub-sec. (1A) should be issued under sub-section (1)(a) even after its amendment by the Finance Act 1956 If any such notice is issued it would be barred by time and therefore beyond the jurisdiction of the Income-tax Officer.

(16) Before we part with this point we must refer to three decisions which were cited at the Bar and which deal with the present point in controversy between the parties. Prom out of these three decisions the first decision to which we must refer is a decision of a Pull Bench of the Punjab High Court in Shahzada Nand and Sons v. Central Board of Revenue and others (1962) 45 I. T. R. 233. We refer to this decision first because it represents the first judicial pronouncement on the question but it is not necessary to refer to it in detail for we find that in it the Punjab High Court has taken the identical view which we are taking in the present case. This decision completely supports the contention of Mr. I. M. Nanavati and the only attack which The learned Advocate General could level against it was that the Punjab High Court had fallen into an error in regarding sub-sec. (1)(a) as a general provision and sub-sec. (1A) as a special provision. This attack is however for reasons which we have already given futile.

(17) The next decision in point of time is the decision of the High Court of Bombay in Special Civil Application No. 1458 of 1962. This decision was given on 2nd May 1963 and is as yet unreported. The view taken in this decision was that assessment for the assessment year ending on 31st March 1941 and subsequent assessment years falling within sub-sec. (1A) could be re-opened by issue of a notice at any time under sub-sec. (1)(a) after its amendment by the Finance Act 1956 This view was of course favorable to the Revenue but the learned Advocate General was not prepared to subscribe to the line of reasoning on which this view was based and in our opinion rightly so. The Bombay High Court apparently did not dispute the proposition that sub-section (1)(a) was a general provision and sub-sec. (1A) was a special provision but it sought to negative the applicability of the maxim generalia specialibus non derogant by saying that sub-section (1)(a) and sub-sec. (1A) did not operate together simultaneously over the escaped income of war years at any time either before the amendment by the Finance Act 1956 or after and there was therefore no conflict between the two provisions which required to be resolved by the application of the maxim. This line of reasoning does not commend itself to us and with the greatest respect to the learned Judges of the Bombay High Court who decided this case we find ourselves unable to accept it. We cannot assent to the proposition that sub sec. (1)(a) and sub-sec. (1A) did not operate simultaneously over the escaped income of war years either prior or subsequent to the amendment by the Finance Act 1956 We are of the view that both before and after the amendment by the Finance Act 1956 sub-section (1)(a) covered the entire subject matter of sub-sec. (1A) and we have already given our reasons for taking this view. The fallacy in the argument which found favour with the Bombay High Court lies if we may say so with great respect in treating the period of limitation provided for taking action under sub-secs. (1)(a) and (1A) as defining and delimiting the ambit and coverage of those sub-sections. This fallacy will become immediately apparent if we consider the following cases. Take the case of assessment year 1946-47 for which the relevant previous year was the calendar year 1945. The previous year in this case fell wholly within the war period and yet action for reopening assessment could on the plain terms of sub-sec. (1)(a) be taken under that sub-section between 17 July 1954 and 31st March 1956 being the period during which sub sec. (1A) was in force. Equally if sub-sec. (1)(a) stood alone action for reopening assessment in respect of the assessment year 1947-48 for which the relevant previous year was the calendar year 1946 could be taken under sub-sec. (1)(a) between 17th July 1954 and 31st March 1976 even though the calendar year 1946 fell partly within the war period and so also action for reopening assessment in respect of other assessment years for which the relevant previous years fell wholly or partly within the war period could be taken under sub-sec. (1)(a) between 17th July 1954 and 31st March 1956 notwithstanding the expiration of the period of eight years provided the case fell within the second proviso to sub sec. (3). It is therefore not correct to say that the areas of operation of sub-sec. (1)(a) and (1A) did not overlap and that consequently the principle of interpretation embodied in the maxim generalia specialibus non derogant was not attracted.

(18) The last decision cited was the decision of the Madhya Pradesh High Court to which we have already made a reference. This decision completely supports the contention of Mr. I. M. Nanavati and we are wholly in agreement with the line of reasoning adopted in this decision.

(19) We are therefore of the opinion that no notice for assessment or reassessment of escaped income of the assessment years in respect of which the relevant previous years fell wholly or partly within the war period could be issued under sub-sec. (1)(a) after the amendment by the Finance Act 1956 if no such notice was issued under sub-sec. (1A) on or before 31st March 1956. The notices in respect of the assessment years 1943-44 and 1946-47 were therefore illegal and invalid.

(20) That takes us to the question relating to the validity of the impugned notices in respect of the assessment year 1950-51. Now since the relevant previous year in respect of the assessment year 1950 did not fall wholly or partly within the war period it is obvious that a notice for reopening the assessment in respect of that assessment year could issue under sub-section (1)(a) even after the expiration of the period of eight years if the other conditions of the sub section were satisfied. One of the conditions was that that set out in clause (ii) of the proviso to sub-sec. (1) and it required that the escaped Income should amount or be likely to amount to Rs. 1 0 0 or more in the aggregate either for the assessment year in respect of which the notice was issued or for that assessment year and any other assessment year or years after which or after each of which eight years had elapsed at the date of the notice excluding the assessment year or years ending before 31 March 1941. Mr. I. M. Nanavati on behalf of the petitioners contended that this condition was not satisfied in the present case and the reason he gave was that for the purpose of computation of the amount of Rs. 1 0 or more mentioned in the condition the escaped income of only those assessment years vas liable to be taken into account in respect of which notice for reopening assessment could be issued under sub-section (1)(a) and since as held by us no notice for reopening assessment could be issued under sub-section (1)(a) in respect of the assessment years 1943-44 and 1946-47 the escaped income of those assessment years was not liable to be taken into account and if that was so the escaped income admittedly did not amount to Rs. 1 0 0 or more and the condition was therefore not fulfilled. We cannot accept this contention. It is based on a construction of clause (ii) of the proviso to sub-sec. (1) which is contrary to the plain language of the enactment and involves the addition of the words in respect of which notice can be issued under clause (a) of sub-section (1) for the purpose of qualifying the assessment year or years of which escaped income is liable to be taken into account in determining whether escaped income amounts to or is likely to amount to Rs. 1 0 0 or more. The scheme of sub-section (1)(a) read with clause (ii) of the proviso to sub-section (1) appears to be that if income has escaped assessment in any assessment year beyond the period of eight years the Income-tax Officer can resort to the machinery of sub-section (1)(a) for assessing or reassessing such escaped income only if he finds that the aggregate income that has escaped assessment in the assessment years preceding the period of eight years amount to Rs. 1 0 0 or more. It is not necessary that there should be aggregate escaped income amounting to Rs. 1 0 0 or more which is liable to be assessed or reassessed under sub-section (1)(a). The only requirement of clause (ii) of the proviso is that there should be aggregate income amounting to Rs. 1 0 0 or more which has escaped assessment in the assessment years beyond the period of eight years. It may be that a part of such aggregate income which has escaped assessment in any particular assessment year is not assessable or reassessable under sub-section (1)(a) but That is not a relevant consideration. Once it is found that the aggregate income that has escaped assessment in the assessment years beyond the period of eight years amounts to Rs. 1 0 0 or more the Income-tax Officer can proceed to assess or reassess the escaped income of any of those assessment years under sub-section (1)(a). The object of clause (ii) of the proviso is that if there is an escaped income of Rs. 1 0 0 or more the Income-tax Officer should be entitled to get at such part of it as he can under sub-section (1)(a) and not that the machinery of sub-section (1)(a) should be available only if the Income-tax Officer can get at escaped income of not less than Rs. 1 0 The argument of Mr. I. M. Nanavati comes to this that either the Income-tax Officer should be able to get at the entire amount of escaped income of Rs. 1 0 0 or more or he should be able to get at nothing. This is certainly not a construction which we can accept as the right construction. Not only is it not supported by the language of clause (ii) of the proviso but it does not even accord with the object of the clause. Moreover there is inherent indication in the clause itself showing that the construction contended for on behalf of the petitioners is not a correct construction. If the language of the clause carried the meaning which Mr. I. M. Nanavati wants to place upon it was hardly necessary for the Legislature to provide expressly in the clause that the assessment year or years of which escaped income may be taken into account shall not be the assessment year or years ending before 31st March 1941. On Mr. I. M. Nanavatis construction even without this express provision the escaped income of those assessment years would have been liable to be excluded from consideration since admittedly no notice for reopening assessment in respect of those assessment years could be issued under sub-sec. (1)(a) by reason of clause (i) of the proviso. The construction suggested on behalf of the petitioners thus leads to superfluity and it is an elementary principle of interpretation that the Court should not be prompt to ascribe and should not without necessity or some sound reason impute to the language of the statute tautology or superfluity and should be rather at the outset inclined to suppose every word intended to have some effect or be of some use. We cannot therefore agree with Mr. I. M. Nanavati when he says that the escaped income of the assessment years 1943-44 and 1946 was not liable to be taken into account for the purpose of determining whether the escaped income amounted to or was likely to amount to Rs. 1 0 0 or more within the meaning of clause (ii) of the proviso since no notice could be issued in respect of those assessment years under sub-sec. (1)(a). If the escaped income of those assessment years be taken into account as we hold it must be it is clear that the escaped income amounted to or was likely to amount to Rs. 1 0 0 or more within the meaning of clause (ii) of the proviso and the condition set out in that clause was satisfied. The notices in respect of the assessment year 1950-51 cannot therefore be successfully challenged on this ground.

(21) Mr. I. M. Nanavati when he opened his case also tried to attack the validity of the notices in respect of the assessment year 1950-51 on the ground that there was no omission or failure on the part of any ox the petitioners to make a return or to disclose fully and truly all material facts necessary for his or her assessment. But when the statements made in the affidavit in reply were pointed out to him he agreed that those statements would give rise to disputed questions of fact which we would not ordinarily entertain on a petition under Article 226 of the Constitution and he therefore stated that he would not press this particular objection to the validity of the notices but would take it up before the Income-tax Officer himself. Since this objection was not pressed before us it is not necessary for us to say anything in regard to the same.

(22) The result therefore is that in each of the petitions the rule will be made absolute and a writ of mandamus will issue quashing and setting aside the notices dated 31st January 1962 in respect of the assessment years 1943-44 and 1946-47. The rule will stand discharged in respect of the notices dated 31st January 1962 in respect of the assessment year 1950-51. The respondent will pay the costs of the petition to each petitioner. Costs in Special Civil Application No. 370 of 1962 will be fixed at Rs. 500/ In the other petitions costs will be the usual costs. Petition allowed.