Case: The Ahmedabad Mfg. &amp; Calicoprinting Co., Ltd Vs. S. C. Mehta, Income-Tax Officerand Another

2. The facts which have given rise to the appeal are these. The Ahmedabad Manufacturing And Calico Printing Co., Ltd., is the appellant before us. The appellant company was incorporated under the Indian Companies Act, 1866, and has its office at Ahmedabad. It carries on the business of manufacturing, and selling cotton piece goods and chemicals. For the assessment yearthe corresponding account year being the calendar year 1951, the appellant was assessed toax on a total income of Rs. 1, 02, 79, 808/and was allowed a rebate of one anna per rupee on the undistributed fits of Rs. 36, 62, 776/under the first proviso to paragraph B of. Part I of the first Schedule to the Finance Act, 1952. The amount of rebate allowed was Rs. 2, 28,For the assessment year 195354, the corresponding account year being the calendar year 1952, the appellant showed a book profit of Rs. 45, 67, 96, 66,but was assessed to a loss of Rs. 5, 98, 353/on April 17, 1954. For the said calendar year 1952, the appellant declared a dividend of Rs. 19, 32, 0000/on April 20, 1954. This dividend came out of the undistributed profits of the calendar year 1951 on which the appellant had been allowed rebate, . On March 18, 1958, theOfficer, Special Circle, Ahmedabad, respondent No. 1 before us, issued a notice to the appellant calling upon the latter to show cause why action under(10) of s. 35 should not be taken against the appellant by withdrawing the rebate allowed on the sum of Rs. 19, 32,The appellant raised some objections, one of which was that(10) of s. 35 did, not apply to his case. TheOfficer, however, held that(10) of s. 35 applied and accordingly directed that the rebate allowed on the sum of Rs. 19, 32, 000/should be withdrawn, by recomputing the tax payable by the appellant. He ordered the issue of a demand notice for a sum of Rs. 1, 20, 750/which was the rebate allowed on Rs. 19, 32,ax Officer passed this order on March 27, 1958.Being aggrieved by that order, the appellant moved the High Court of Bombay by a writ petition filed on June 26, 1958. The main ground taken by the appellant was that(10) of s. 35 did not apply to a case where dividend was declared, as in this case, before the coming into force of(10) of s. 35. The High Court rejected this contention and dismissed the writ petition. The appellant then obtained certificate of fitness and has preferred the present appeal in pursuance of, , that. certificate. We may now read some of the provisions of s. 35 in so far as they are relevant for our purpose"S. 35(1) The Commissioner or Appellate Assistant Commissioner may, at any time within four years from the date of any order passed by him in appeal or, in the case of the Commissioner, in revision under s. 33A and theOfficer may, at any time within four years from the date of any assessment order or refund order passed by him on his own motion rectify any mistake. apparent from the record of the appeal, revision, assessment or refund as the case may be, and shall within the like period rectify any such mistake which has been brought to his notice by an, assessee : xx xx xx (2) xx xx (3) xx xx (4) xx xx (5) Where in respect of any completed assessment of a partner in a firm it is found on the assessment or reassessment of the firm or on any reduction or enhancement made in the income of the firm under section 31, section 33, section 33A, section 33B, section 66 0 section 66A that the share of the partner in the profit or loss of the firm has not been included in the assessment of the partner, or if included, is not correct, the inclusion of the share in the assessment or the correction thereof, as the case may be, shall be deemed to be a rectification of a mistake apparent from the record within the meaning of this section, and the provisions ofsubsection (1) shall applythereto accordingly, the period of four years referred to in that subsection being computed from the date of the final order passed in the case of the firm.(6) Where the excess profits tax or the business profits tax payable by an assessee has been modified in appeal, revision or any other proceeding, or where any excess profits tax or business profits tax has been assessed after the completion of the corresponding assessment for(whether before or after the corm. mencement of the Indian(Amendment) Act, 1953), and in consequence thereof it is necessary to recompute the total income of the assessee chargeable toion shall be deemed to be a rectification of a mistake apparent from the record within the meaning of this section and the provisions ofsubsection (1) shall applyaccordingly, the period of four years referred to in that subsection being computed from the date of the order making or modifying the assessment of such excess profits tax or business profits tax. (7) xx xx (8) xx xx (9) xx xx (10) Where, in any of the assessments for the years beginning on the 1st day of April of the years 1948 to 1955 inclusive, a rebate ofwas allowed to a company on a part of its total income under clause (1) of the proviso to Paragraph B of Part I of the relevant Schedules to the Finance Acts specifying the rates of tax for the relevant year, and subsequently the amount on which the rebate ofwas allowed as aforesaid , is availed of by the company, wholly or partly, for declaring dividends in any year, the amount or that part of the amount availed of as aforesaid, as the case may be, shall, by reason of the rebate ofallowed to the company and to the extent to which it has not actually been subjected to an additionalin accordance with the provisions of clause (ii) of the proviso to Paragraph B of Part I of the Schedule to the Finance Acts above referred to, be deemed to have been made the subject of incorrect relief under this Act, and theOfficer shall recompute the tax payable by the company by reducing the rebate originallyallowed, as if the computation is arectification of a mistake apparent from the record within the meaning of this sectionand the provisions ofsubsection (1) shall applyaccordingly, the period of four years specified therein being reckoned from the end of the financial year in which the amount on which the rebate ofwas allowed as aforesaid was availed of by the company wholly or partly for declaring dividends." Speaking generally, s. 35 deals with rectification of mistakes in circumstances detailed in the various subsections thereof and provides for orders consequent on such rectification.(1) empowers theauthorities to rectify mistakes apparent from the record in respect of certain orders passed by them. It provides that theOfficer concerned may at any time within four years from the date of any assessment order passed by him on his own motion rectify any mistake apparent from the record of the assessment: The power of rectification may be exercised subject to two conditions : (1) that there is a mistake apparent from the record of the assessment, and (2) that the order of rectification is made within four years from the date of the assessment sought to be rectified.(5) deals with inclusion or correction of the income of a partner in a firm consequent upon assessment or reassessment of the firm of which he was a partner. Subsection (6) deals with recomputation of total income of an assessee in consequence of modifications made in the excess profits tax or the business profits tax payable by an assessee subsequent to an assessment made under the Incometax Act. These two subsections were considered by this court in two decisions to which we shall presently refer. They have been relied on by the appellant and have some bearing on the interpretation ofIt deals with a case where a rebate was allowed to a company on a part of its income (viz., undistributed profits) by virtue of the concessions given by the Finance Acts of 1948 to 1955. This is clear from the first part of theThe second part states the condition in which, or rather the crucial event on the happening of which, the rebate granted. to a company is deemed to have been given by a mistake apparent from the record, this condition or crucial event is the declaration of dividends by the company out of the amount in whole or part, on which abate was earlier granted to it. The third and operative part states that on the happening of the crucial event, the amount on which rebate was granted and which has been subsequently utilised for declaring dividends shall be deemed to have been made the subject of incorrect relief under the Act and theOfficer shall recompute the tax payable by the company by reducing the rebate originally allowed as if the recomputation is a rectification of a mistake apparent from the record within the meaning of the section. The fourth and last part introduces a period of limitation of four years, the four years being reckoned not from the date of the order passed as inbut from the end of the financial year in which the amount on which rebate ofwas allowed was availed of by the company wholly or partly for declaring dividends. This, in brief, appears to be the scheme of subs. (10) of s. 35.Now, the argument on behalf of the appellant is this. Like(5) of s. 35,(10) affects a vested right, namely, the right to a rebate ofon a part of the total income of the company under clause (1) of the proviso to Paragraph B of Part I of the relevant Schedules to the Finance Acts of 1948 to 1955, and the further right to declare dividends out of the undistributed profits of the previous year. Under the well settled rules of statutory construction, no statute which impairs an existing right or obligation except as regards a matter of procedure, shall have retrospective operation unless such a construction appears very clearly in the terms of the Act or arises by necessary and distinct implication. Put differently, a statute is not to be construed to have a greater retrospective operation than its language renders necessary;............ and it is submitted that "the general rule is that all statutes other than those which are merely declaratory, or which relate only to matters of procedure or of evidence are prima facie prospective; and retrospective effect is not to be given to them unless by express words or necessary implication, it appears that this was the intention of the legislature" and "it is a corollary of this general presumption against retrospection that, even when a statute is intended to be to some extent retrospective,  it is not to be construed as having a retrospective effect than its language renders necessary". (Halsburys Laws of England, Vol. 36. Third edition, p. 423 and p. 426). The argument on behalf of the appellant is that by s. 28 of the Finance Act. 1956,(10) has undoubtedly retrospective effect from April 1, 1956; but the language of thedoes not expressly, nor by necessary implication, show that it has any greater retrospective effect. It is pointed out that, on the contrary, where the legislature wanted a particular subsection to have greater retrospective effect, it had said so, e. g. in(6). It is also pointed out that(5) of s. 35 was inserted by the Indian(Amendment) Act, 1953, and by s. 1 (2) of the said Act it came into force on April 1, 19.52. Where the legislature wanted to give greater retrospective effect to particular provisions, it said so in ss. 3 (2), 7 (2) and 30 (2) of the said Act. That being the position, the argument on behalf of the appellant is that we should not give any greater retrospective effect to(10) of s. 35 than what has been done by s. 28 of the Finance Act, 1956.Learned Counsel for the appellant has strongly relied on the decision of this Court inOfficer v. S. K. Habibullah ([1962] Supp. 2 S. C.. R, 716, ) wherein with regard to subs. (5) of s. 35 it was held that the subsection was not declaratory of thepreexisting law nor a matter relating to procedure buteffected vested rights and must be deemed to have come into force only from April 1, 1952; therefore, ther had no jurisdiction under the saidto rectify the assessment of a partner consequent on the assessment of the firm in cases where the firms assessment was completed before April 1, 1952. The argument of the learned counsel for the appellant is that the same principle must apply in the present case and(10) of s. 35 does not apply to a case where dividend was declared by the company before the date of the coming into force of the, April, 1, 1956.The second part of the argument of the learned counsel for the appellant is that there is no real difference in language between the two. (5) and sub.s. (10) of s. 35. In both cases 1 rectification or correction is made by reason of a subsequent event; in) the subsequent event is the assessment of the firm which discloses the inaccuracy in the earlier assessment of a partner; in(10) the subsequent event is the declaration of dividend out of the amount on which a rebate was earlier granted. It is pointed out that in their true scope and effect, the twod on the same footing.) further makes it clear that by a legal fiction that which was correct at the time when it was made is rendered incorrect after the coming into force of theon states clearly "shall, by reason of the rebate ofallowed to the company.............................. be deemed to have been made the subject of incorrect relief under this Act, and thete the tax payable by the company by reducing the rebate originallyallowed................." This language, it is argued, is clearly prospective and does not justify the carrying of the legal fiction to a period earlier than April 1, 1956.As against these arguments, learned counsel for the respondent has contended that the language of) is different from that of(5) and the principle laid down by this court in S. K. Habibullahs ([1962] Supp, 2 S.C.R. 716, ) cannot be applied to the present case. Alternatively , he has argued that the decision is incorrect and should be reconsidered by us. The argument of learned counsel for the respondent is that(10) by necessary implication has a greater retrospective effect than what is laid down by S. 28 of the Finance Act, 1956. He points out that the first part of the subsection talks of the assessments made for any of the years beginning on April 1, 1948, to April 1, 1955, when a rebate ofs allowed; then the second part refers to the subsequent declaration of dividend by the company in any year. Learned counsel for the respondent has emphasised the expression "in any year" and has submitted that this shows that the intention was to take in a declaration of dividend made even earlier than April 1, 1956, According to him, the only effect of s. 28 of the Finance Act, 1956, is that ther can take action only after April 1, 1956, but the language of thedoes not justify the conclusion that the legal fiction created by it must be restricted to the declaration of dividends on or after April 1, 1956.We have carefully considered these arguments.The language of(10) of s. 35 is perhaps not as clear as one might wish it to be. There is no doubt, however, that the subsection affects vested rights and should not be given a greater retrospective operation than its language renders necessary. Even through theis to a certain extent retrospective, and s. 28 of the Finance Act, 1956, in express terms makes it retrospective from April 1, 1956, it is clear to us that there is nothing in the language of thewhich would justify the inference that the legislature intended to carry the legal fiction created by theto a period earlier than the date on which the

Court's reasoning:
7. There is no doubt that the words "subsequently " and "in any year" mean in any year subsequently to the year in which the rebate was granted. They would, therefore, clearly include a year before thesubsection came intoforce. But it is said that these words should in view of the rule be read as not including a year before thesubsection came intoforce as they also include years subsequent to the coming into force of theand are therefore ambiguous.I am unable to accept this contention. I find no ambiguity. If the intention was that the subsection would apply only when the amount was availed of for declaration of dividends after it was enacted then the words ""subsequently" and "in any year" were wholly unnecessary. Without these words thewould have read, "and the amount is availed of for declaring dividends." There would then be no doubt that it was intended to operate only prospectively. But the legislature used some more words. It must have done so with some purpose. What that purpose was if it was not to give theretrospective operation, I failed to see. I am unable to read the words "subsequently" and "in any year" as otiose and as indicating no different intention. Therefore, it seems to me that the language of the subsection plainly requires it to have a retrospective operation. The subsection is properly applicable to this case.8. There is another consideration leading me to the view that the presumption against retrospective operation does not arise here. It was said in Pardo v. Bingham that it was not an invariable rule that a s could not have a retrospective operation unless so expressed in its very terms, and that it was necessary to look to the general scope and purview of the statute and at the remedy sought to be applied and consider what was the former state of the law and what it was that the legislature contemplated. It is quite plain that in providing for the grant of rebate on undistributed profits by the , Finance Acts of 1948 to 1955 the legislature wanted to encourage the employment of the profit made in a business in the business itself. The object presumably was to expand the industries of the country. This involved a long term employment of the, profits in the business. It could not have been the intention of the legislature to grant rebate when a company only kept the profits for a short time with itself and having earned the rebate distributed the profits without the industry having had any real benefit of them. I think should state here that the provisions for the grant of rebate did not require that dividend was not to be declared at all. The object was to encourage a reasonable division of the profits between the shareholders and the industry. Allowance of rebate was provided for on that part of the profits which was left for employment in the industry after reasonable dividends had been distributed to the shareholders. The rebate was allowed on a graded scale depending on the amount of profits which was not distributed as dividends.Now the system of granting rebates started inIt was stopped inThe subsection was brought into force on April 1, 1956, that is, seven years after the system had first been started. Theprovided for withdrawal of the rebate when the amount on which it had been granted was availed of in declaring dividends. It is fairly clear from this that the legislature did not approve of these amounts being utilised in declaration of dividends.9. It is also not too much to suppose that there had been many previous cases of such utilisation of profits for if it had not happened earlier, there is no reason to think that the legislature anticipated the evil happening in future and passed the law to stop it. In view of the large number of years that had passed between the time when the allowance of rebate commenced and the time when thesubsection was brought intoforce, it can be imagined that a very large number of cases of distribution of profits on which rebate had been allowed, had already taken place. I find it difficult to think that many cases remained after April 1, 1956, where a company which intended to utilise the amounts on which rebate had been granted in the declaration of dividends, had not already done so.10. There is no dispute that by(10) the legislature intended to penalise a case where subsequent to its enactment, the amount on which rebate had been granted was utilised in declaration of dividends. Now is there any reason to think that the legislature did not want to impose the penalty also on those who had earlier utilised the amount in declaration of dividends ? There was no special merit in these latter cases, And I also think that they formed the majority of the cases. The grant of rebate having been stopped after March 31, 1956, there was no occasion to provide for cases of such grant thereafter. All these circumstances lead me to the. view that the intention of the legislature was to penalise the cases of utilisation of amounts on which rebate had been granted in payment of dividends which had happened before thesubsection came intoforce. The remedy which the subsection provided would largely fail in any other view. The general scope and purview of the subsection and a consideration of the evil which it was intended to remedy lead me to the opinion that the intention of the legislature clearly was that the subsection should apply to the facts that we have in this case.As to S. K. Habibullahs case I do not think that much assistance can be had from it. It applied the rule of presumption against a statute having a retrospectiveto which rule, of course, there is no dispute to(5) of s. 35. Now cases on the construction of one statute are rarely of value in construing another statute, for each case turns on the language with which it is concerned and statutes are not often expressed in the same language. The language used in(5) and (10) seems to me to be wholly different. There is nothing in S. K. Habibullahs case (1) to indicate that in the opinion of the learned judges deciding it there were any words which would indicate that(5) was to have a retrospective operation. In my view,(10) contains such words.11. Furthermore, I do not find that the other considerations to which I have referred, arose for discussion in that case. In my view, the two cases are entirely different.12. I therefore, think that(10) of s. 35 properly applies to this case. In my view, the appeal should be dismissed withx Act imposes a charge of tax for a year at a time and that year is the year of assessment. The charge is in respect of a previous year which is commonly known as the year of account. The rate at which the tax is to be charged is enacted by an annual Finance Act for each assessment year. The assessment year is the Financial Year. From the nature of things an amendment of theAct, made in the middle of the assessment, year, if made to operate from the beginning of the, assessment year, operates on incomes which had been earned before. Since an amendment cannot be. allowed to operate from theeach such amendment is made to, comprise a whole assessment year whether it be the assessment year then running. or an earlier or a later assessment, year. Amendments are thus .give retrospective. operation from the first day of April in the same, or a preceding, or prospective operation for a future assessment year. Ordinarily, the law, as it stands on the 1st of April in any assessment year, applies to, assessments in that year. but the law may expressly or by necessary implication give itself a greater retrospective operation.The date on which the amendment comes into force is the date of the commencement of the amendment. It is read as amended from that date. Under ordinary circumstances, an Act does not have retrospective operation on substantial rights which have become fixed before the date of the commencement of, the Act. But this rule is not unalterable. The legislature may affect substantial rights by enacting laws which are expressly retrospective or by, using language which has that necessary result. And this language may give an enactment more retrospectivity than what the commencement clause gives to any of its provisions. When this happens the provisions thus made retrospective expressly or by necessary intendment, operate from a date earlier than the date of commencement and affect rights which, but for such operation, would have continued undisturbed.19. It must be remembered,that if theAct prescribes a period during which the, tax due in any particular assessment year may be assessed, then on the expiry of that period the Department cannot make an assessment. Where no period is prescribed the assessment can be completed at any time but once completed it is final.20. Once a final assessment has been made, it can only be reopened to rectify a mistake apparent from the record (s. 35) or to reassess where there has been an escapement of assessment of income for one reason or another (s. 34). Both these sections which enable reopening of back assessments provide their own periods of time for action but all these periods of time, whether for the first assessment or for rectification, or for reassessment, merely create a bar when that time passes against the machinerytax Act for the assessment and levy of the tax. They do not create an exemption in favour of the assessee or grant an absolution on the expiry of the period. The liability is not enforceable but the tax may a in be come eligible if the bar is removed and theis brought within the jurisdiction of the said machinery by reason of a new power. This is, of course subject to the condition that the law must say that such is the jurisdiction, either expressly orimplication. If the language of the law has that clear meaning, it must be given that effect and where the language expressly so declares or clearly implies it, the retrospective operation is not controlled by the commencement clause.The amendment, with which we are concerned, was made by the Finance Act, 1956 (18 of 1956). By s. 2, it dealt with the year beginning on the 1st day of April, 1956, and fixed the rates of taxes, for the assessment year commencing on that date. It also amended theAct by ss. 3 to 35. Section 28 then prescribed the dates of commencement of these sections. It read :"28. Commencements of amendments to Act 11 ofamendments made in theAct, by section 4 and clause (b) of section 15 shall be deemed to have come into force on the 1st day of April 1955, and the amendments made by section 3 to 27 inclusive shall come into force on the 1st day of April, 1956."(10) was introduced into s. 35 of theAct by s. 19 of this Act. If there was nothing more in the language of theto give it operation from an earlier date it would have operated only from 1st April, 1956, but the language of thegives it additional retrospectively and says so in such clear and unambiguous language as to leave no doubt. There is no room for the application of Lord justice Bowmens dictum in. Reid v. Reid ((1886) 31 Ch. D. 409.) that even in construing a section which is to a certain extent retrospective, the maxim that statutes are prospective only, ought to be borne in mind as applicable whenever the line is reached at which the words of the section cease to be plain.21. The topic of s. 35 is rectification of mistakes apparent from the record.(10) introduced a new basis for rectification in s. 35 which already prescribed a period of four yearsorder of assessment and the new subsection enabled rectification to be made in new circumstances and within a new time limit. Those circumstances when analyzed, furnish the key to the retrospectivity of the section. We shall begin by quoting only the material portion of thatwhich has been quoted in full earlier "Where, in any of the assessmentsthe years beginning onthe 1st day of April of the years 1948 to 1955 inclusive, a rebate ofwas allowed......... and subsequently the amount on which the rebate ofwas allowed... is availed of .......for declaring dividends in any year...... the, amount .....shall be deemed to have been, made the subject, of incorrect relief and the Incomete the tax as if the recomputation is a rectification of a mistake apparent from the record within the, meaning of this section and. the provisions ofsubsection (1) shall applyaccordingly, the period of four years being reckoned from the end of the financial year in Which. the amount on which rebate ofWas allowed was, availed of for declaring dividends."The purport of this newwas the recall of rebate which had. been allowed in any of the assessments948 tounder certain. circumstances.22. At the very start, thetakes one to assessment years to which S. 28 which prescribed the commencement as 1did not take one to. We do not accept the argument of the learned counsel for the assessee company that the mention of the years is merely a repetition of a historical fact for ready reference. The words "in any of the assessmentstc. II show in respect ofwhich, assessments rectification, would be possible.The years are mentioned individually by usingthe word "any". The law. speaking in 1956 was thusspeaking of all the assessment years individuallygoing.back to 1st April, 1948. ;The language wasclearly one of retrospectivity and the suggestion, that there is no intent behind these words and that they merely refer to a historical fact isnot acceptable to us. This conclusion is further fortified by the words :"and subsequently the amount.... .... is availed of for declaring.. dividends in any year.." Having mentioned the years individually in the opening part, an event is mentioned which is subsequent, namely, declaration of dividend from an amount on which rebate was allowed. "Subsequently" here obviously means subsequent to "any. of the assessmentsthe years beginning onthe 1st day of April of the years55 inclusive", not necessarily subsequent to the Amending Act. The declaration of the dividends must be after the grant of the rebate.23. That is the only condition and it does not import the date of commencement of the subsection in any way . Then comes the operative part and it is this. If in the earlier assessment in any of the years mentioned a rebate was allowed and subsequently in any year there was a declaration of dividend utilising the amount on which the rebate Was given, the amount so utilised should be deemed to be the subject of incorrect relief. This fiction comes into force frombut it is not stated that the circumstances in which it comes into being should also be afteron no doubt is to be used frombut it is to be used retrospectively to recall rebate on amounts which the law deems to have been the subject of an incorrect relief in the past. The recalling of the rebate is after the enactment of(10) but theconditions for the exercise of the power may be before or after the commencement of theThe only curb on the exercise of the power is that theOfficer may go back a period of four years reckoned from the end of the financial year in which the declaration of dividend was made to the date when the action is taken.In the present case, this is so. The assessee company declared dividends in the calendar year 1952. The assessment year was4. The letter written on March 18, 1958, asking the assessee company to show cause was within the four years reckoned from the end of the financial yearin which the amount on Which rebate ofwas availed of for declaring dividends. It complied with the letter of theSince the power commenced. onthe utmost reach of theOfficer would be the end of the assessment year A 1952. Any declaration of dividend after 1st day of April, 1952, out of accumulated profits of any of the years in which rebate was earned would be within time for the recall of the rebate. But a declaration prior towould be beyond the power of theOfficer to recall. This meaning is the only meaning which the plain words of the section can bear. Any other meaning might make sub.s. (10) unworkable because no company., , with the knowledge that rebate would be recalled, would like to declare dividends after April 1, 1956, out of amountson which rebate was earned. If the other meaning was attributed,(10) might well be a dead letter. Thewas obviously the result of noting how rebates were earned and later were being utilized to fill the pockets of the shareholders. The amendment met this situation and did it in very clear terms.24. It remains to consider, the decisions of this court in Habibullahs case ([1962] Supp, 2 S.C.R. 716) and Atmala Nagarajs case ([1962] 46 I. T. R. 609.). In those two cases this Court was called upon to interpret subs. (5) quoted above which was introduced as from April 1 1952, by the Indian(Amendment) Act, 1953., In both the cases there was a final assessment of the incomes of partners in registered firms. Later the assessment of the registered firms took place and it was found that the share of income of the partners was larger than what had been assessed. Under s. 35 (1), as it stood before(5) was introduced, rectification could be made in respect of a mistake apparent from the record and the records of the firms could not be read with those of the partners to find an error in the latter. There was thus an impasse. It was ruled by the Privy Council in Commissioner ofv. Khemchand Ramdas((1938) L. R. 65 I. A. 236, 248.), at p. 248 : "............... When once a final assessment, is arrived at, it cannot, in their Lordships opinion, be reopened except in circumstances detailed in section 34 and 35 of the Act........... and within the time limited by those acts." Therefore, unless the original s. 35 allowed such rectification there was no help. Often the firms final assessment dragged on for years and by the time that assessment was done the time limited by (sub.s.1) had already run out. Parliament therefore stepped in with an amendment which was to commence on April 1, 1952. Two matters were provided by(5). Firstly, the result of the assessment of the firm showing that the partners income was not properly included in their own assessments, was to be deemed to disclose an error in the record of the partners assessment and secondly, the period of four years instead of being computed from the order of assessment made against the partners as under(1) was to be computed from the date of thefinal order passed in the case of thefirm.No doubt this. power could be exercised frombut the question that had to be considered was whether it could be exercised only to reopen the assessment of partners of a firm if, and only if, the order in the assessment of the firm was passed after the amendment came into force. In dealing with the matter in Habibullahs case([1962] Supp. 2 S.C.R. 716.) this Court referred to the finality which attaches to a final assessment as stated by the Privy Council. This Court then referred to the date of the commencement of(5) which was fixed retrospectively asand held that thecould not be used to reopen assessments which had become final before the commencement of the new subsection, contrasting its language with that of(6) which wits, simultaneously introduced. In Habibullahs case (1) the dates were :Partners assessment for48 onRegistered firms assessment for