JUDGMENT

1. as follows :-

(1) Whether assessment was validly made under section 34 of the Act upon the income, after the proceedings events, namely :-

(i) The assessee included said income in return under Section 22(2).

(ii) The Income Tax Officer making assessment upon Hindu undivided family, of which Lala Madan Mohan Lal is the Karta held the said income to be income of the family, had included it in assessment thereon.

(iii) The Income Tax Officer making assessment upon the present assessee thereupon did not include the said income in his assessment under Section 23(3).

(iv) The Hindu undivided family succeeded in appeal against the inclusion of the said income in their assessment.

Under Section 66(1) he has referred the following question :-

"if the answer to the first question be in negative, will there be any limitation of time (other than general reasonableness) upon an order to be duly made under Section 33 of the Act in review of the initial assessment under section 23(3) and adding the said income thereto."

The principal question with which we are really concerned is the one under Section 66(2). The answer to this question depends on the interpretation that can be put on the words "escaped assessment as used in section 34 of the I income Tax Act. Section 34 reads as follows :-

"If for any reason income, profits or gains chargeable to income tax has escaped assessment in any year or has been assessed at too low a rate, the Income Tax Officer may, at any time, within one year of the end of that year, serve on the person liable to pay tax on such income, profits or gains * * * a notice containing all or any requirements which may be included in a notice under sub-section (2) of section 22 and may proceed to assess or to re-assess such income, profits or gains and the provisions of this Act shall so far as may be, apply accordingly as if the notice was a notice issued under that sub-section :

Provided that the tax shall charged at the rate at which it would have been charged, had the income, profits or gains not escaped assessment or full assessment as the case may be."

The assessee contends that this section can be invoked only if income is omitted to be duly returned and not if income having been duly returned is left out either intentionally or unintentionally by the Income Tax Officer concerned. The Commissioner, on the other hand maintains that the section is wide enough to cover every case of non-assessment.

On behalf of the appellant reliance is mainly placed on the following authorities :- Kishen Kishore v. Commissioner of Income Tax, Burma v. U Lu Nyo; Burn & Co., In re; Rajendra Nath v. Commissioner of Income Tax, Bengal. In Kishen Kishore v. Commissioner of Income Tax, Punjab, the Income Tax Officer assessed K to income tax as the head of an undivided Hindu family, consisting of himself and his son, on the income of the family during the year previous to tax year. On review, the Commissioner set aside the assessment and directed the Income Tax Officer to assessed K as an individual; whereupon the Income Tax Officer serve upon K a notice under Section 22(2) read with section 34 of the Income Tax Act, calling upon him to submit a declaration of his total income from all sources for the previous year for the purpose of re-assessing him for tax year. It was contended on behalf of the assessee that as his income could not be said to have escaped assessment, Section 34 did not apply. JAILAL, J., who delivered the judgment, in which MONROE, J., concurred, remarked that it was clear from the facts of the case that when the assessment was originally made for the first time on the assessee as the head of the undivided Hindu family, no part of the income was alleged to have been concealed by him and that the income which was sought to be assessed was, therefore, disclosed and was known to the income tax authorities. In these circumstances, it was held that the income could not be said to have escaped during the previous year, the expression escaped connoting failure by the taxing authority to tax the income owing to accidental or deliberate omission by the assessee to declare it or to some similar circumstances and not including case where the income was known or disclosed to the income tax authority and had been the subject of assessment which had, however, been set aside later. No case law has, however, been discussed by the learned Judges in arriving at this conclusion.

In Commissioner of Income Tax, Burma v. U Lu Nyo the assessee was engaged in tobacco business during the accounting period and produced before the Income Tax Officer for the purpose of assessment of certain accounts which were rejected. The Income Tax Officer assessed the income derived from the tobacco business under Section 23(3). In the following another Income Tax Officer on going further into the was dissatisfied by the previous assessment and took action under section 34 of the Income Tax Act, treating the income as having escaped the assessment before. He found inter alia that his predecessor was wrong in thinking that the profits of the tobacco business was only at Rs. 30 a maund and held that it should be calculated at Rs. 60 a maund. On these facts, the learned judges of Rangoon High Court held that the Income Tax Officer had no jurisdiction to revised the assessment for the previous year which was completed and had become final. It will be obvious that this authority is clearly distinguishable, as the facts before us are quite different. In that case no income had been found to have been either omitted from the original return or to have been deliberately exempted from assessment by the Income Tax Officer. What the Income Tax Officer did was to correct the estimate at which the profits had been previously assessed, and that was obviously unauthorised.

In Burn & Co., In re the learned judges did not express any definite opinion on the point at issue and decided the case on different point. The main question before them was whether a certain notice was within time or not, and learned judges found that they could dispose of this question without definitely deciding as to when the income could be said to have escaped, they avoided a definite expression of opinion on that matter. This is clear from page 139 of the report. It may also be remarked that had the learned judges been satisfied as to the meaning of the term "escaped" as contended by assessees counsel, it would not have been necessary to touch the other point at all.

The most important judgment to be considered in this connection, however, is Rajendranath v. Commissioner of Income Tax, Bengal. It is in a way connected with Burn & Co., In re, as the appeal before their Lordships of the privy Council had arisen from certain proceeding which had been to in that judgment. It was contended before their Lordships of the Privy Council that an assessment once begun, if not completed within the year, could not be made unless it was done under section 34 of the Income Tax Act, as, in those circumstances, the income could be said to have escaped assessment. The main question, therefore, before their Lordships of the Privy Council, as remarked by LORD MACMILLAN at page 286 of the report whether it was competent to make the assessment in question on the firm after the expiry, on the 31st March, 1928, of the year in respect of which the assessment was made. The position taken before their Lordships of Privy Council was evidently untenable and their Lordships in this connection remarked as follows at pages 90-91 of the report :-

"The appellants, however, submit that this is a case of income escaping assessment, within the meaning of Section 34. Assessment they argued, is a definite act, indeed the most critical act in the process of taxation. If an assessment is not made on income within the tax year, then that income, they submit, has escaped assessment within that year, and can be subsequently assessed only under Section 34 with its time limitation. This involves reading the expression has escaped assessment as equivalent to has not assessed. Their Lordships cannot assent to this reading. It gives too narrow a meaning to word escaped and too wide meaning to the word escaped. That the word assessment is not confined in the statute to the definite act of making an order of assessment appears from section 66 which refers to the course of any assessment. To say that the income of Burn and Company which in January 1928 was returned for assessment and which was accepted as correctly returned, though it was erroneously included in the assessment of Martin and Company, has escaped assessment in 1927-28 seems to their Lordships as in admissible reading. The fact that section 34 requires a notice to be served calling for a return of income which has escaped assessment strongly suggests that income, which has already been duly returned for assessment, cannot be said to have escaped assessment within the statutory meaning. Their Lordships find themselves in agreement with the view expressed in In re Lachhiram Basantlal by the learned chief Justice RANKIN : "income has not escaped assessment if there are pending at time proceedings for assessment of the assessees income which have not yet terminated in a final assessment thereof."

I have given this passage in extenso, as in my view the decision of this case hinges on the construction which is to be placed on the view of their Lordships of the Privy Council as expressed above. If the passage means, as urged by the council for the assessee, that any income, which is once returned, cannot be said to have escaped, no matter what may have happened afterwards, the assessee must succeed. But it, on the other hand, the above passage means something else, then he must fail, as there is ample authority against him from the various High Courts in India. As stated above, the question before their lordships was whether a certain notice was within time and in order to find a comply answer to the question, it was necessary to interpret the word "escape". Their Lordships did it in particular reference to the question before themselves, and the key of whole passage really lies in the quotation from Chief Justice RANKINs judgment by their Lordships at Privy Council. The decision arrived at by their Lordships of the Privy Council is that if once the assessment proceedings have started, it will not matter if they do not terminate in the year in which they have started and so long as these proceedings continue, it will be not possible to say that the income has escaped assessment. When their Lordships remarked that the expression "has escaped assessment" was not equivalent to "has not been assessed" their Lordships of the Privy Council intended to lay down that this meaning of has not been assessed cannot be put upon the expression escaped assessment under any circumstances, cannot be accepted. The element of non-assessment is present in every case, whether the assessment is not made on account of non-inclusion of the income by the assessee in his return or is not made even if the income is returned, on account of erroneous judgment by the Income Tax Officer or on account of his oversight. Whether we place a restricted interpretation on the term "escaped" or give it a much wider signification, the element of non-assessment must be present. To my mind, this judgment does not lay down such a proposition as is contended for on behalf of the assessee.

In addition to the authorities cited above, counsel for the assessee has also relied on the scheme of the Act, and urged that the sequence of the sections by itself indicates that Section 34 was intended by the Legislature to apply to cases of non-inclusion only and not to cases of accidental or deliberate failure of the Income Tax Officer. He has urged that after the procedure for assessment has been provided for, the Legislature has enacted Section 30 and allowed an aggrieved assessee to appeal to the Assistant Commissioner against any orders passed by the Income Tax Officer against him. Section 31 lays down the procedure for the hearing of appeals, Section 32 provides for appeals to the Commissioner against certain orders of Assistant Commissioners. Section 33 confers powers of revision or review on the Commissioner, Section 35 empowers the Commissioner or Assistant Commissioner or the Income Tax Officer to rectify certain mistakes. On this, counsel argues that as Section 34 has been inserted between Section 33 and Section 35, it is evident that it is not intended to correct any mistakes of law which can be corrected under Section 33, or mistakes of fact which can be corrected under Section 35, and that it is merely intended to provide for those cases where there is no mistake apparent on the face of the record arising either in law or on facts. I do not however think that any argument can be developed on this score. Moreover, Section 33 employs only the Commissioner and none else to revise or review the proceedings taken under this Act by any authority subordinate to him or by himself while exercising the power of an Assistant Commissioner. Section 35 is confined to such mistakes as are apparent from the record of appeal, revision or assessment as the case may be; and if we restrict the scope of Section 34 also in the manner suggested, then no provision in the Act will be left to meet cases like the present where an assessment is cancelled by an appellate or a revisional authority as being erroneous in law and the Income Tax Officer wishes to re-assess such income.

It is further urged that the Income Tax Act, being a fiscal enactment, should be considered strictly and in favour of the subject. Even if this were so, this will not help the appellant. In the first place, Section 34 is a mere machinery section and not a charging section and consequently this canon of the interpretation of statutes will not apply. Secondly, even a strict construction of this section will not justify the imposition of any restrictions on the interpretation of the word "escaped". As I understand the law a strict interpretation may prohibit the importation of any extraneous matter into any statutory enactment but will not justify the elimination or subtraction of any material ingredients from it. If a plain word carries a plain sense in the English language, however strict the law may interpret it, it will not ignore the ordinary meanings which it carries. Taking now the dictionary meaning of the term, I find that the word "escape" admits of more than one signification. In Murrays Oxford Dictionary, this word has been defined as follows :- "Free oneself from (a persons grasp or control) to get safely out of (painful or dangerous conditions); to avoid capture, punishment or any threatened evil; to elude (observation, search etc.); to elude notice (of a person); to get off safely when pursued or imperilled; to get clear away from (pursuit or a pursuer); to elude (a persons grasp); to succeed in avoiding (anything painful or unwelcome)". It is evident, therefore, that it connotes the idea of elusion as well as that of avoidance at the same time. For example, if an item of income is not charged because it is not included in the return, it would be proper to say that that income has escaped assessment. Equally proper the expression will appear to be even if the non-charge follows upon the refusal of the Income Tax Officer to charge it, whether that refusal is based on legal or illegal grounds. Similarly, income will said to have escaped assessment if it has not been charged on account of an oversight by the income-tax authorities; and so long as these interpretations of the word "escape" are permissible without any straining or stretching of the language, to my mind it will be a violence of all canons of interpretation not to interpret it so. In other words, it would be wrong to place any restrictions on the generality of its meaning. As already remarked, the authorities which have attempted to restrict its meaning have not stated any reasons so as to how they have justified that course. "Elusion" by itself imports the idea of existence of the thing eluded and as the meaning of the term "escape" covers the idea of elusion, it will not be a sound proposition of law to urge that in order to justify an application of this term, the thing should not have existed. It is all the more reasonable to interpret it in a wider sense, as in the section itself this expression is qualified by the words "for any reason".

I am fortified in my conclusion by the following authorities Commissioner of Income Tax, Madras v. Krishna Chandra, Anglo-Persian Oil Co. v. Commissioner of Income Tax, Bengal, Ganesh Das re and Commissioner of Income Tax, Burma v. N. N. Burjorjee. In Commissioner of Income-tax, Madras v. Krishna Chandra, it was held that under Section 34 of the Act a person was liable to be assessed to income-tax in a succeeding year for an income in respect of which he was exempted by the Income Tax Officer in the previous year not inadvertently but deliberately on a consideration by the officer of the question of the liability. SIR MURRAY COUTTS TROTTER, C. J., while delivering his judgment remarked as follows :-

"It is said that escaped assessment must mean not that the question has been considered and decided in favour of the assessee, but that the Income Tax, Officer has ommited to consider the question at all or was unaware of the existence of the property now sought to be taxed and, therefore, passed it over and that it does not apply to cases where the Income Tax Officer on consideration came to the conclusion, ex hypothesi an erroneous conclusion, that the property in question was not assessable. It seems to me that that constructions is forbidden by the alternative case put in the section. That cannot be a matter of mere inadvertence, that must refer to a deliberate assessment made by the Income Tax, Officer in the preceding year with knowledge of the facts and circumstances. It appears to me that a similar view must be taken of the previous words escaped assessment and that it applies to cases where the Income Tax Officer has deliberately adopted an erroneous construction of the Act just as much as to a case where the officer has not considered the matter at all but simply omitted the assessable property from his view and from his assessment".

This authority was followed in Anglo-Persian Oil Co., In Sir GEORGE RANKIN, C. J., observed as follows :-

"I see no way of holding that Section 34 is inapplicable to put right an assessment, by which a deduction has been improperly allowed. Such a case is, in my opinion, a case of income escaping assessment * * and there is nothing in Section 34 which limits it to cases of non-disclosure by the assessee or discovery of new matter by the income tax authorities or advertence as distinguished from erroneous on the part of these authorities".

In Ganesh Das, In re, the Commissioner of Income Tax had urged that Section 34 could not be invoked in respect of income which had been assessed in the hands of an assessee to whom it was subsequently found not to belong. The learned Judges remarked that this argument did not appear to them to be sound, and added :-

It may be remarked that one of the decision was the learned Judge who delivered judgment in Kishen Kishore v. Commissioner of Income Tax, Punjab.

In Commissioner of Income Tax, Burma v. N. N. Burjorjee, three Judges of the Rangoon High Court observed as follows :-

"We are of opinion that Section 34 is applicable to cases in which either no assessment at all has been made upon the person who received the income, profits or gains liable to assessment or where an assessment has been made in the course of the year, but some portion of the income, profits or gains of such assessee for some reason or other has not been included in the order of assessment; such income is income which has escaped assessment in the year, and falls within the ambit of Section 34 of the Act".

In connection with this Judgment also I may note that two of the learned Judges, who decided it, were responsible for the decision in Commissioner of Income Tax, Burma v. U Lu Nyo. I may further remark that Ganeshdas, In re and Commissioner of Income Tax, Madras v. Krishna Chandra, were citied before their lordships of the Privy Council in Rajendra Nath v. Commissioner of Income Tax, Bengal, but were not animadverted upon or overruled.

I would accordingly hold that if an item of income is included in the return submitted by an assessee during a tax year but is left unassessed by the Income Tax, Officer, or if assessed in the first instance the assessment is cancelled by any appellate or revisional authority, it escapes assessment within the meaning of Section 34 and the assessee can be legally served with the notice within one year of the end of that year.

In these circumstances, the answer to the question referred by the Commissioner under section 66(2) will be in the affirmative.

The question referred under section 66(1) need not be answered, as it does not arise.

ADDISON, Act. C. J. - I have had the advantage of reading the judgment about to be delivered by my brother DIN MOHAMMAD, and, as I am in full agreement with it, I do not propose to discuss the question at length.

The assessee, Madan Mohan Lal, is also the Manager of a joint Hindu family This reference deals with his individual assessment for the year 1931-32, for which he made a return on the 24th August, 1931, to the Income Tax Officer, dealing with his case. In the meantime another Income Tax Officer dealing with the case of the joint Hindu family, came to the conclusion that all amounts received from the Delhi Cloth and General Mills, the principal source of the family income, in the name of individual members of the family, was the income of the family and not of the individual, except what was paid as salary. He, therefore, included in the family income commission, amounting to Rs. 79,543, which has been included by the assessee in his individual return. Upon this, the Income Tax Officer, having jurisdiction over the "individual" assessment excluded that item from it, and assessed Madan Mohan Lal in his individual capacity upon Rs. 6,096, only, this amount being made of Rs. 6,000 salary from the Mills, and Rs. 96, from other sources.

The joint Hindu family, of which of the assessee if the manager appealed to the Assistant Commissioner of Income Tax. He allowed the appeal to the extent of excluding the sum of Rs. 79,543 from the "family" assessment. The Income Tax Officer issued notice under Section 34 of the Act upon the assessee in his individual capacity before the expiry of the financial year 1932-33 with respect to the item excluded from that family assessment. This notice was duly served and, if Section 34 applies, the notice was within time. No question of limitation, therefore, arises in this case.

On receipt of this notice, the return made by the assessee was as follows :- "Previous was complete - nothing was concealed - therefore there is nothing to add now." The Income Tax Officer then made an assessment upon the assessee as an individual with respect to the Commission excluded from the family assessment. He fix the additional sum to be assessed to income tax as Rs. 59,543 after allowing certain deductions claimed. The question is whether he could do so under Section 34 of the Act.

If that Section is read as it stands, there appears to me to be no difficulty. It did "escaped assessment" in his hands at first, if this words are given there ordinary meaning; and it was assessed under Section 34 within limitation. The assessment, therefore, legal unless some restricted meaning must be given to words "escaped assessment". Commissioner of Income Tax, Burma v. U Lu Nyo, is not in point, being clearly distinguishable, and all other authorities in India take the view that the words should be given there ordinary meaning, except Kishen Kishore v. Commissioner of Income Tax, Punjab. The learned judges who decided that the case gave no reasons for coming to the conclusion they did, and one of them was a member of the Bench, which decided Ganesh Das In re, from which the opposite can be deduced. The matter was mentioned in Burn & Co., In re, but not decided.

Reliance was, however, placed by the learned counsel appearing for the assessee on a decision of their Lordships of the Privy Council, Rajendra Nath v. Commissioner of Income Tax, Bengal. Admittedly that case is not on all fours with the present. What was decided in it was that and assessment can be made under Section 23(1) of the Act more than year, in fact at any time, after the assessment year, if in the meantime no final assessment has been made. But as the appellant before their Lordships relied upon Section 34 of the Income Tax Act, they discuss those arguments and made some remarks on the Section. Their remarks are at pages 290-291 of the Report and they must, in my judgment, be interpreted with reference to the arguments and point which had then to be decided. The argument was that, if a final assessment order was not made within the tax year allowed by the Section 34. The principal question to be decided, was what was the meaning of the word "assessment" and whether it could take place after the tax year. The answer was that the final assessment order could be made at any time. In coming to this conclusion their Lordships observed as follows : "This involves reading the expression has escaped assessment as equivalent to has not been assessed. Their Lordships cannot assent to this reading. It gives to narrow a meaning to the word "assessment" and too wide a meaning to the word "escaped, that the word assessment is not confined in the statute to the definite act of making an order of assessment appears from Section 66, which refers to the course of any assessment.

In my judgment, when their Lordships remarked that the expression "has escaped assessment" was not equivalent to "has not been assessed" they meant the expression "has escaped assessment" can have no possible application to a case were the course of the assessment was not yet complete and there had in fact been no final assessment order and nothing more. They were more concerned with the meaning of the word assessment, to which they gave a wide interpretation than with defining the exact meaning of the word escaped. All they finally held about the later word was that it was not wide enough to include income, as to which no final assessment order had yet been made and as to which the assessment was still running its course. This pronouncement, therefore, cannot be interpreted as giving the restricted meaning to the words, which was given in Kishen Kishore v. Commissioner of Income Tax, Punjab.

The words "for any reason" in the beginning of the Section 34 appears to me to widen the interpretation and not to narrow it, and to be of sufficient importance too be emphasised.

I would answer the first question referred by the Commissioner in affirmative. The second does not arise.

DALIP SINGH, J. - The facts of this reference are given in the statement of the case by the Commissioner of Income Tax, Punjab. It seems that Lala Madan Mohan Lal had to be assessed both as individual and as Karta of the joint Hindu family of which he was the head. He made return on 24th August, 1931, in his personal capacity in which he included an item of about Rs. 79,543, as personal income. He also made return on behalf of joint Hindu family and the Income Tax Officer who was dealing with the assessment of Lala Madan Mohan Lal as an individual on the 7th March, 1932 assessed Lala Madan Mohan Lal as an individual on the return furnished by him but excluding the item of Rs. 79,543 on the ground that this item had been included and assessed in the hands of the Hindu joint family by the Income Tax Officer dealing with that case. The assessee naturally did not appeal from this order but he appeal from the order assessing this income as a portion of the joint Hindu family income. After various delays the Assistant Commissioner accepted the appeal and excluded this item from the income of the Hindu joint family holding that it was the personal income of the assessee. On the 31st March 1933, a notice had been served on the assessee under section 34 for a fresh return. This was before the decision of the appeal on the 17th April, 1933. It would seem that the income tax authorities anticipating the possible result of the assessees appeal, took the precaution of issuing a notice to him to make a fresh return so as to be within the limitation imposed by Section 34 of the Income Tax Act. The assessee replied that he had already furnished return and he had nothing to add thereto. The Income Tax Officer dealing with the personal case decided on the 13th February, 1934, that the item of Rs. 79,543 had escaped assessment and while accepting the return of the assessee he assessed him on this item. The assessee objected that Section 34 had no application and the income had not escaped assessment and the fresh assessment was made without jurisdiction. In appeal, however, the Assistant Commissioner upheld the order of the Income Tax Officer holding that the income had escaped assessment. The Commissioner was asked to state the case under Section 66(2) of the Income Tax Act and he had stated the question in the first page of the printed paper book, namely, whether assessment was validly made under Section 34 of the Act upon the income in the circumstances given above. He has also under Section 66(1) referred another question, namely, (if the answer to the first question be in the negative, will there be any limitation of time (other than general reasonableness) upon an order to be duly made under Section 33 of the Act, in review of the initial assessment under Section 23(3) and adding the said income thereto. The Commissioner concedes second question is in regard to an order in contemplation and not in existence. No revision proceedings under Section 33 have apparently yet been taken. But he contends that in order to avoid multiplicity of proceedings the High Court might return to an answer to this question also if the first question is answered in the negative.

So far as this last question is concerned I do not think that there is any section which empowers the Commissioner to ask the advise of the High Court as to the legality of any proceedings that he intends to take. I do not think it would be proper for the High Court to express any opinion on the point because the point may never arise as the assessee may not ask for a reference on the point and secondly, because any decision or advise given by this Bench on a question not directly arising before it could not bind the Bench that subsequently heard the reference, if any upon this question when it really did arise. I therefore do not think it would be proper to give answer to the second question at all.

There remains, therefore, only the first question. Section 34 of the Income Tax Act has been the subject of interpretation by the Privy Council and I need hardly say that the judgment of the Privy Council if applicable must bind this Court. The short question before us is, whether in the circumstances detailed above the income can be said to have escaped assessment. The Privy Council decision referred to is printed as Rajendra Nath v. Commissioner of Income Tax, Bengal (I. L. R. 61 Cal. 285) and facts of that case appears to be follows and are stated in the judgment of their Lordships at pages 286 to 288. In that case there were two firms, Burn & Company and Martin & Company. The partners of Martin & Company acting as individuals purchased the shares of the partners of Burn & Company and thus became owner of the Burn & Company. It appears that partners had not purchased the business of Burn & Company with funds belonging Martin & Company, but other funds belonging to themselves as individuals and the intention of the purchasers was to embark on a separate venture unconnected with Martin & Company. The Income Tax Officer issued a notice to Burn & Company calling for a return of their total income. On coming to know the fact of the purchase the Income Tax Officer combined the incomes of Burn & Company and Martin & Company and assessed them as one on the return made by martin & company. The return made by Burn & Company was not made the subject of any assessment order. Finally the High Court held that this was illegal. Accordingly the assessment order passed on Martin & Company was revised by the Income tax authority excluding the income of Burn & Company. The income tax authority then proceeded to assess the income of Burn & Company without taking any action under Section 34 merely treating the assessment as not having been completed and proceedings, therefore, under section 23. The assessment having been made Burn & Company appeal to the Assistant Commissioner who however rejected the appeal and confirmed the assessment. Then they ask for a reference to the High Court under Section 66(2). Those questions are printed at page 288. The High Court the first and second questions in the affirmative and the third question in the negative. They held briefly that the Income Tax Officer could proceed under Section 23(1) and it was not correct that the income having escaped assessment in any year the only remedy left to the income tax was to proceed under Section 34. The assessee then appealed to the Privy Council and their argument is summarised by their Lordships of the Privy Council at page 290. They contended that the income had escaped assessment within the meaning of section 34. They contended that the word assessment meant the order of assessment and as no such order had been passed on the income within the tax year therefore the that income had escaped assessment within that year and could only be assessed under Section 34 subject of course to the limitation of time imposed by that section. Their Lordships repelled the contention holding that was the assessee wanted them to do was to read the words has escaped assessment as equivalent to has not been assessed. Their Lordships held that this reading was not correct for two reasons. It gave too narrow meaning to the word assessment. Their Lordships pointed out that in the statute the word assessment is not confined to the act of making an order of assessment and referred in particular to section 66 which refers to the course of any assessment. They further went on to say that an income which was returned for assessment and which was accepted as correctly returned though erroneously included in the assessment of another company could not be said to have "escaped" assessment. Then occurs the following words :- The fact that Section 34 requires a notice to be served calling for a return of a income which has escaped assessment, strongly suggest that income which has already been duly returned for assessment cannot be said to have escaped within the statutory meaning. Their Lordships themselves find in agreement with the view expressed in In Lachiram Basantlal (I. L. R. 58 Cal. 909) by the learned Chief Justice : "Income has not escaped assessment if there are pending at the time proceedings for the assessment of the assessees income which have not yet terminated in a final assessment thereof. It may be that if no notice calling for a return under Section 22 is issued within the tax year then section 34 provides the only means available to the crown of remedying the ommision but that is a different matter".

The question is, what did their Lordships of the Privy Council intend to hold by these words? It appears to me that the argument of the assessee which their Lordships repelled necessarily involved for its repulsion the two reasons given by their Lordships. The owed "assessment", according to their Lordships of the Privy Council, may be taken equivalent to "the course of assessment" and not equivalent to "the order of assessment." If their Lordships had merely stopped with that remark then the argument of the assessees might have been that though the word assessment may mean the course of assessment yet as no order of assessment had been passed within the tax year on an assessment still proceeding, the income had escaped the assessment in the sense that it had not been assessed in that year though it could not be said to have finally escaped assessment. Their Lordships repelled that argument by the finding that the word escaped was not to be read in the widest sense that the word is capable of bearing and it seems to me that their Lordships intended to hold that the word escaped is equivalent to eluded notice in the course of assessment and did not mean had avoided being notice. Their Lordships state this in beginning when they lay down that the assessees argument involves reading of expression has escaped assessment as equivalent to has not been assessed and their Lordships cannot assent to this reading. It may be contended here that what their Lordships meant to hold was no more than that the word escaped might include a case of absence of an order of assessment as well as a case where the income in question had not figured in the order of assessment and all their Lordships meant to lay down was that the absence of an order of assessment does not make an income escape assessment. But if this was the meaning of their Lordships it seems to me that the argument would have been put quite differently and that the word the fact that 34 requires a notice etc. that income which has already been duly returned for assessment cannot be said to have escaped assessment would not have been employed at all. These words would be irrelevant to the argument. It would make no difference whether the income had or had not been included in the return or whether the return had or had not been accepted as correct. Their Lordships however lays stress on this. It seems to me, therefore, that their Lordships expressed by the judgment the view that I have endeavoured to state in other words above. After all in what sense can the income in the present case be said to have escaped assessment except in the sense that it has not been assessed. It figured in a return and that return has been accepted as correct. It figures in the final order of assessment and was rejected from assessment not because the attention of the Income Tax Officer was not directed to it but because he held that it had been, and presumably rightly assessed elsewhere. The only sense, therefore, in which it can be said to have escaped assessment is in the sense that it has not been assessed but this is the very meaning that their Lordships said was not the correct meaning of the wordsescaped assessment. If this is so, then the case is concluded by the judgment of their Lordships of the Privy Council and that being binding on this Court, the income cannot be said to have escaped assessment in this case.

I would, however, for completeness point out that in Lachhiram Basantlal, In re, to which ruling their Lordships referred with approval this very point which now arises was noticed as a possible way of disposing of that case but was expressly not decided. The argument for the Income Tax Commissioner appears to be something like this : an income has not escaped assessment while it is still in the process of assessment but it may be said to have escaped assessment when for any reason whatsoever it has not been assessed in the final order of assessment. This argument appears to me to involve the same meaning of escaped assessment which their Lordships said was incorrect, namely, that the words, escaped assessment are equivalent to has not been assessed in the sense of not having been the subject of or not having being charged in the final order of assessment. I would also like to point out that the results of accepting the view taken by the Income Tax Commissioner would appear to be rather startling. Suppose a case where an income has been rejected from assessment on the ground mentioned in this case by the Income tax officer, and by the Assistant Commissioner in the appeal, and in revision by the Commissioner. No section provides any power to the Commissioner to review his own decision on the ground that he has made a mistake. Was it then the intention of the Legislature that the Commissioner could proceed to review his own order by ordering the Income Tax Officer to take action under Section 34 ? No doubt, if the Legislature has so expressly provided such a power could be given but surely more clear and express words would have been employed if that was the object of the Legislature. A reference was made to Section 125 of the English Income Tax Act. That section is completely differently grafted and it appears to me to throw no light on the present question at all. But if it did throw any light it would appear to me rather that the Legislature intended by the words escaped assessment to refer to the cases given in the two paras. of that section at most, that is, to cases of omision of the income by the default of the assessee and possibly by the omission of Income Tax Officer. It is clear that the words "profits omitted" do not cover a case of this kind where the Income Tax Officer has rightly or wrongly given deliberation to the subject and had rejected the income from assessment on the ground that income belongs to some person other than the assessee. If Section 34 was intended to mean, that whenever an income had not been assessed in a final assessment order owing to some mistake of fact or law by any Income Tax authority or by any omission or default on the part of assessee, the income tax authority could review his previous decision or make a demand for a return on the assessee it seems to me that it could easily have been expressed in that manner. The section would then have run : "If for any reason income etc., chargeable to income tax has not been assessed in any year owing to any mistake of fact or law by the income tax authorities or by any omission or default on the part of assessee or has been assessed at too low a rate, the Income Tax Officer may in the first place review his decision after giving notice to the assessee and in the second case may serve on the person liable to pay tax on such income etc., a notice etc. I may notice here one argument which offers in a ruling reported as Commissioner of Income Tax, Madras v. Krishna Chandra (I. L. R. 49 Mad. 23). In that ruling it was held that a certain construction of Section 34 proposed by the assessee was not correct because of the words has been assessed as too low a rate which according to their Lordships could not be matter of inadvertence but only of a deliberate assessment made by the Income Tax Officer with knowledge of the facts and circumstances. This does not appear to me to be correct for there is one obvious case to which the reasoning does not apply in which the assessment may have been made at too low a rate, that is the case in which certain income has escaped assessment. If, for instance, the rate varies between Rs. 20,000, and Rs. 30,000 and the assessee was assessed at Rs. 20,000 and it subsequently became known that his proper income was Rs. 30,000 the result that has followed is (1) that he had not paid income tax on Rs. 10,000 which he did not mention in his return and also (2) has been assessed at too low a rate on the Rs. 20,000 which he did mention in his return. It appears to me, therefore, that the words has been assessed at too low a rate do not throw any light on the meaning of the words has escaped assessment. In fact if I may respectfully point out the ruling of their Lordships of the Privy Council that the words escaped assessment are not equivalent to has not been assessed receives support from the fact that the words has been assessed are used in this very section upon the question of the lower rate. It would have been strange indeed if the Legislature intended that the words escaped assessment should mean has not been assessed and should not use that expression when it was inevitably suggested by the use of the words has been assessed in the same sentence. It is clear from the judgment of the Privy Council that the word escape is not to be given its widest meaning. I am unable to see how in this case the income can be said to have escaped assessment unless the word is given its widest meaning. It is unnecessary for me to go into the various rulings which have been cited before us. They have summarised in Amir Singh Sher Singh v. Commissioner of Income Tax, Punjab. This is the ruling whose conflicts with Kishen Kishore v. Commissioner of Income Tax, Punjab has occasioned the Full Bench reference. I may briefly remarked that it does not appear to me that the words for any reason can throw any light on the meaning of the word escape. There is nothing to show that the intention of the Legislature was to shape section 34 on the model of Section 125 of the English Act. I would, therefore, with great deference to the learned Judges who decided that case expressed my respectful dissent from the reasoning of that case. That case, however, on its facts is clearly distinguishable. It was a case of an Income-tax Officer wrongly deciding that a certain deduction allowed should not have been allowed. Now, while Section 125 of the English Act appears to expressly provide for that case, for the reason I have given, I do not think that the words "escaped assessment" cover that kind of case at all. It seems to me, further that the case was wrongly decided because assessment meansthe course of assessment. The course of assessment involves both the calculation of the income and the charging of the income. In order to escape assessment an income must avoid both calculation and charging. In the case where the deduction has being wrongly allowed, the income has possibly escaped being charged, but has not escapade calculation. It is true that the arithmetical result is the same, but that is not the same thing as holding that the calculation never took place. I can see no distinction arising between a mistake of fact and a mistake of law on the part of the Income Tax Officer on the words of the Statute. If therefore this ruling were correct, it would be open to the Income Tax Officer to revise his decision on the ground of any mistake of fact or law. This appears to me to go beyond even the provision of Section 125 of the English Act. It is opposed to decision Commissioner of Income Tax v. U Lu Nyo, which was conceded to be rightly decided by the learned counsel for the income-tax authority.

Lastly, I would point out that the remedy was entirely in the hands of the income-tax authorities on a different procedures. They knew that the Hindu joint family assessment was under appeal. The personal assessment could have been forwarded to the Appellate authority, the Assistant Commissioner, with the request that if he came to a different conclusion from the Income Tax Officer on the subject of the item in dispute, viz., Rs. 79,543, the personal assessment should be revised under the powers conferred up under Section 33 on the Commissioner. Now while it is possible there might be an overlapping of powers conferred on different persons in a Statute, yet where the matter admits of doubt at least, the construction against overlapping of powers should be adopted ordinarily. I would, therefore, answer the first question referred by the Commissioner in the negative.

ORDER OF THE COURT.

By a majority of Judges, the answer to the question referred under Section 66(2) is the affirmative. The second does not arise. No order as to costs.

Order accordingly.

.