DULAT, J. - In respect of the assessment year 1942-43 notice under section 34 of the Indian Income-tax Act, 1922, was served on the assessees on April 3, 1951. The Income-tax Officer then proceed to make an assessment which was affirmed by the Appellate Assistant Commissioner. An appeal was, however, taken to the Income-tax Appellate Tribunal and there apparently it was pointed out that the assessees had been served more than eight years after the expiry of the assessment year and consequently the proceedings were invalid in view of section 34(1)(a). This view prevailed and the assessment was consequently quashed by the Appellate Tribunal. The Commissioner of Income-tax thereupon moved for a reference to this court, under section 66 of the Income-tax Act, the question of law sought to be referred being whether for a valid assessment it was not only necessary to issue a notice under section 34 within eight years of the end of the assessment year but also to serve the assessees within that period of time. The Appellate Tribunal accepted this and referred, therefore, the following question for decision by this court :
'Whether on a true interpretation of the terms of sub-section (1) and of the first proviso to sub-section (3) of section 34 of the Indian Income-tax Act, 1922, a notice issued under sub-section (1) of that section with respect to a case falling under clause (a) of that sub-section, must not only be issued within the time limit of eight years, but must also be served within that time limit, in order to sustain an assessment made in pursuance of such a notice ?'
There were three assessees in this connection and, therefore, three separate references have been made (Civil References Nos. 1, 2 and 3 of 1956), but they can be dealt with together, the question involved being identical.
The relevant part of section 34, as it stood at the time of the decision by the Appellate Tribunal, ran as follows :
(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 section 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 to income-tax have escaped assessment 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
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 in a notice under sub-section (2) of section 22 and may proceed to assess or re-assess such income, profits or gains......'
The view adopted by the Appellate Tribunal has been that since the Legislature has used the words 'serve on the assessee within eight years,' the meaning is that for a valid assessment it is essential that the assessee must have been served within that period of time and not merely that a notice may have been issued within that time. It is contended, however, on behalf of the Commissioner of Income-tax that the word 'serve' used in section 34 really means the same thing as 'issue', and Mr. Sikri in support of this argument seeks assistance from the circumstance that in sub-section (3) of section 34 reference is made to 'issue' of a notice and no mention is made of 'service'. I do not consider, however, that sub-section (3) of section 34 has much to do with this matter because what we have to interpret is sub-section (1) of section 34 and the language of that sub-section leaves no doubt that the Legislature fully intended that service on the assessee must be made within the time mentioned in that sub-section and quite obviously if the intention was that the issuing of a notice within the period mentioned was sufficient, there could have been no difficulty in using that expression instead of a totally different expression like 'serve' which has a different connotation. If we are to accept Mr. Sikris contention we will be making a change in the words of the statute and that we are not competent to do. No authority in support of Mr. Sikris contention is forthcoming and, in fact, the decisions are, according to him, all against his view. In these circumstances there is, in my view, no doubt that the Appellate Tribunal rightly interpreted the meaning of section 34(1)(a) in holding that it was necessary to serve the assessees within the period of eight years of the close of the assessment year, and the mere issuing of a notice within that period of time was not enough.
Failing on the question of interpretation Mr. Sikri suggested that because of certain enactments made subsequent to the decision of the Tribunal we should now answer the question in a different way. He relied in this connection on the enactment of the Finance Act, 1956(18 of 1956), section 18, and more specifically on the recent enactment of the Indian Income-tax (Amendment) Act, 1959(1 of 1959). The effect of these enactments, according to Mr. Sikri, is that the time limit of eight years mentioned in section 34 is now of no consequence as its mention has been omitted, and the recent Act I of 1959 has, according to Mr. Sikri, specifically validated notices of assessment issued after the expiry of the period of eight years. The difficulty, however, in considering this particular argument is that no such controversy of law has been referred to us by the Appellate Tribunal, and it seems to me that if we are to appreciate Mr. Sikris argument and, of course, any opposing argument we would be dealing with several questions of law which never arose and in the nature of things never could have arisen before the Appellate Tribunal. As I understand the meaning of section 66 of the Indian Income-tax Act, it is not open to us to consider or decide any such questions, even of law. Section 66, sub-section (1), of the Income-tax Act says :
'(1) Within sixty days of the date upon which he is served with notice of an order under sub-section (4) of section 33, the assessee or the Commissioner may, by application in the prescribed form, accompanied where application is made by the assessee by a fee of one hundred rupees, require the Appellate Tribunal to refer to the High Court any question of law arising out of such order, and the Appellate Tribunal shall within ninety days of the receipt of such application draw up a statement of the case and refer it to the High Court :......'
And sub-section (5) then says :
(5) The High Court upon the hearing of any such case shall decide the questions of law raised thereby and shall deliver its judgment thereon..'
It is clear that the reference again and again is to the order of the Tribunal and to any question of law arising out of such order. The meaning of these provisions obviously is that if a question of law is raised before the Tribunal arising out of the case before it and there is some controversy later whether that question of law has or has not been rightly settled by the Tribunal, the aggrieved party can demand that it be referred to and decided by the High Court. The only question of law which did arise before the appellate Tribunal and which was decided by the Tribunal was about the proper interpretation of certain provisions contained in section 34 of the Indian Income-tax Act as it stood at the time of that decision. This question has been referred to us and has been answered. Mr. Sikri in raising the matter of subsequent enactments virtually asks us to answer another question altogether, namely, the question concerning the true effect of those subsequent enactments which depends on their interpretation, but since it is clear that such a matter was never before the Tribunal and never could arise out of the order made by the Tribunal, it is difficult to agree that such a question of law can be said to arise out of the Tribunals order, and therefore answerable by us. Mr. Sikri referred to a decision of the Supreme Court in Commissioner of Income-tax v. Ogale Glass Works Ltd. BHBI, but the facts of that case have no resemblance to the present for there was in that case before the Supreme Court the same controversy of law between the parties, as it was before the Appellate Tribunal. Such is not the case here and, as a later decision of the Supreme Court in New Jehangir Vakil Mills Ltd. v. Commissioner of Income-tax has explained, section 66 does not enable the High Court to raise a new question of law which does not arise out of the Tribunals order and that the function of the High Court is confined to answering the precise question of law arising out of the order of the Tribunal. It is true that this court has power to frame a question of law properly if its verbal expression is found defective and also, in appropriate cases, to answer an allied question of law which properly arises out of the case decided by the Tribunal, but that does not mean that an entirely new question of law can be raised by the High Court, i.e., a question which never was before the Appellate Tribunal. In these circumstances it is not possible for us to accept Mr. Sikris contention that we should proceed to decide the effect of the enactments mentioned by him, i.e., The Finance Act, 1956, and the Indian Income-tax (Amendment) Act, 1959, in support of the present case.
No other question arises. In my opinion, therefore, the answer to the question referred to us by the Tribunal must be in the affirmative and I would return that answer and direct that the costs of the three references be paid by the petitioner which we fix at Rs. 250 for the whole set.
DUA, J. - I agree.
Question answered in the affirmative.