l Appeals Nos 1301 of 1971 and 1981 of 1968
Appeals by special leave from the Judgment and order dated November 15 1956 of the Bombay High Court Nagpur Bench in Special Civil Application No 150 of 1963
B Sen J Ramamurthy R N Sachthey and B D Sharma for the appellant in both the appeals
A section Bobde G L Sanghi and B R Agarwal for the respondent in both the appeals
615 The Judgment of the Court was delivered by Hegde J
Civil Appeal No 1301 NCT of 71 is by special leave
This appeal was filed under the following circumstances Civil Appeal No 1981 of 1968 was brought on the strength of a certificate issued by the High Court
That certificate being not in accordance with law in as much as the High Court gave no reason in support of the same the appeal filed on the strength of that certificate turned out to be not maintainable
Hence the appellant had to move this Court for special leaveto appeal against the judgment of the High Court
The same having been granted he has brought Civil Appeal No 1301 of 7 1
Hence these two appeals against the same judgment
Now coming to the merits of the case the Income tax Officer issued a notice to the respondent on January 5 1962 under section 341 a of the Indian Income tax Act 1922 seeking to reopen his assessment for the assessment year 1946 47 the relevant accounting year being the calender year 1945
The assessee respondent challenged the validity of that notice by means of a writ petition under Article 226 of the Constitution before the High Court of Bombay
The High Court accepted that writ petition and quashed the impugned notice by its order dated March 6 1963
On April 1 1962 the Income tax Act 1961 came into force
Thereafter the Income tax Officer again issued a notice on March 26 1963 under section 148 of the new Act in respect of the very assessment which he earlier unsuccessfully sought to reopen by means of a notice under section 341 a of the 1922 Act
The assessee again challenged the validity of the notice issued to him by means of another writ petition before the High Court of Bombay
The High Court quashed that notice on the ground that the Income tax Officer was not competent to issue that notice
It is against that decision the present appeals have been brought to this Court
Section 147 of the 1961 Act provides  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 under Section 139 for any assessment year to the Income tax Officer or to disclose fully and truly all material facts necessary for his assessment for that year income chargeable to tax has escaped assessment for that year 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 616 consequence of information in his possession reason to believe that income chargeable to tax has escaped assessment for any assessment year he may subject to the provisions of Sections 148 to 153 assess or re assess such income or re compute the loss or the depreciation allowance as the case may be for the assessment year concerned hereinafter in Sections 148 to 153 referred to as the relevant assessment year
Section 148 reads 1 Before making the assessment re assessment or re computation under Section 147 the Incometax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub section
2 of section 139 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
2 The Income tax Officer shall before issuing any notice under this section record his reasons for doing so
 Section 149 prescribes the time limit for issuing a notice under Section 148
Sub section i of Section 149 says No notice under Section 148 shall be issued a in cases falling under Clause a of Section 147 i for the relevant assessment year if eight years have elapsed from the end of that year unless the case falls under sub clause iiii  Section 297 deals with repeals and savings
Section 297 2 d ii reads thus  Notwithstanding the repeal of the Indian Incometax Act 1922 ii of 1922 hereinafter referred to as the repealed Act d where in respect of any assessment year after the year ending on the 31st day of March 1940  i      ii any income chargeable to tax had escaped assessment within the meaning of that expression in Section 147 and no proceedings under section 34 of the repealed Act in respect of any such 617 income are pending at the commencement of this Act a notice under Section 148 may subject to the provisions contained in Section 149 or section 150 be issued with respect to that assesment year and all the provisions of this Act shall apply accordingly
Emphasis supplied
The only question for decision in these appeals is whether the proceedings initiated by the notice under section 341 a of the 1922 Act were pending at the time when the new Act came into force
It is not denied that such proceedings were factually pending
But what was contended by Mr B Sen learned counsel for the department was that that notice being an invalid notice on the ground that that was barred by limitation the proceedings initiated on basis of that notice should be considered as not pending in the eye of the law
We are unable to accept this contention
What section 297 2 a ii requires is the factual pendency of a proceeding under section 34 of the repealed Act
The question whether that proceeding was barred by limitation or not is irrelevant
It is not denied that those proceedings were initiated by a competent authority
Those proceedings were quashed for the reason that notice under section 34 of 1922 Act was issued beyond the time prescribed by law
Hence it cannot be said that no proceeding under section 34 of the 1922 Act either factually or legally was pending at the time when the new Act came into force
Our above conclusion receives support from the decision of this Court in Raja Kulkarni and others vs The State of Bombay1
Therein the question that arose for decision was whether an appeal under section 24 of the Industrial Disputes Act 1950 can be said to have been pending if that appeal was incompetent or invalid for some reason
This Court ruled that what was necessary was the factual pendency of the appeal and not that it should have been a valid or competent one under the provisions of the limitation Act or such other adjectival law
The proceedings pending before a competent authority cannot be said to be not pending merely because that no relief can be granted in that proceedings because of the bar of limitation
In Mela Ram  Sons vs Commissioner of Income Tax Punjab  it was contended before this Court that any appeal which is barred by limitation cannot be considered as an appeal properly presented under Section 30 of the Indian Income Tax Act 1922
This Court rejected that contention observing  1 1954 SCR 384
2 29 ITR p 607 618 it an appeal is not presented within that time within the prescribed time does that cease to be an appeal as provided under section 301  It is well established that rules of limitation pertain to the domain of adjectival law and that they operate only to bar the remedy but not to extinguish the right
An appeal preferred in accordance with Section 301 must therefore be an appeal in the eye of law though having been presented beyond the period mentioned in section 302 it is liable to be dismissed in limine
 We have no doubt in our mind that the proceedings initiated under Section 341 a of the 1922 Act were pending at the time 1961 Act came into force and that being so the Income tax Officer was not competent to issue any fresh notice under section 148 of the 1961 Act
In the result Civil Appeal No 1301 of 71 fails and the same is dismissed with costs
Civil Appeal No 1981 of 68 is dismissed as not being maintainable
Parties to bear their own costs in this appeal
KBN Appeals dismissed


Summary:
The Income tax Officer issued a notice to the respondent on January 5 1962 under section 341 a of the Indian income tax Act 1922 seeking to reopen his assessment for the assessment year 1945 47
The respondent challenged the validity of that notice
The High Court quashed the impugned notice by its order dated March 6 1963 on the ground that the notice was issued beyond the time prescribed by law
On April 1 1962 the Indian Income tax Act 1961 came into force
Under section 2972 d ii of this Act if any income chargeable to tax had escaped assessment within the meaning of that expression in section 147 and no proceedings under section 34 of the repealed Act in respect of any such income are pending at the commencement of this Act a notice under section 148 may  be issued with respect to that assessment year
 The Income tax Officer again issued a notice under section 148 of the New Act in respect of the assessment which he earlier unsuccessfully sought to reopen by means of notice under section 341 a of the 1922 Act
The respondent again challenged the validity of the notice
The High Court quashed that notice on the ground that the Income tax Officer was not competent to issue that notice
In appeal to this Court it was contended that the notice under section 341 a being an invalid notice on the ground that it was barred by limitation the proceedings initiated on the basis of the notice should be considered as not pending when the new Act came into force
Dismissing the appeal HELD  What section 2972dii requires is the factual pendency of a proceeding under section 34 of the repealed Act
Whether that proceeding was barred by limitation or not is irrelevant
The proceedings pending before a competent authority cannot be said to be not pending merely because no relief can he granted in that proceedings because of the bar of limitation
The proceedings in the present case were initiated by a competent authority and those proceedings were quashed for the reason that the notice was issued beyond the time prescribed by law
Hence it cannot be said that no proceedings under section 34 of the 1922 Act either factually or legally was pending at the time when the new Act came into force
617 D