Summarize the following court judgment. Appeal No. 130 of 1962. Appeal by special leave from the Judgment and decree dated March 17	 1959	 of the Allahabad High Court in Misc. Writ Petition No. 280 of 1958. K. N. Rajagopal Sastri and R. N. Sachthey	 for the appellant Bishan Narain	 G. C. Sharma	 O.C. Mathur	 J. B. Dadachanji and Ravinder Narain	 for the respondent. A. V. Vishwanatha Sastri	 D. N. Mukherjee and B. N. Ghosh	 for the intervener. January 29	 1964. 'Me Judgment of B. P. Sinha C.J.	 K.Subba Rao and N. Rajagopala Ayyangar JJ.	 was delivered by Subba Rao J. The dissenting opinion of Raghubar Dayal and Mudholkar JJ.	 was delivered by Mudholkar J. SUBBA RAo J. This appeal by special leave raises the question of the construction of the proviso to sub section (3) of section 34 of the Indian Income tax Act	 1922	 as amended by Act 25 of 1933	 hereinafter called the Act. The facts lie in a small compass and they are as follows: The respondent is a firm carrying on business in different lines. It was assessed to income tax under section 23 (4) of the Act for the assessment year 1949 50 on the ground that the notice issued under sub sections (2) and (4) of section 22 of the Act had not been complied with. On September 27	 1955	 the said assessment was cancelled under section 27 of the Act. But before the said cancellation	 it was found that an interest income of Rs. 88	737 in the shape of U.P. Encumbered Estates Act Bonds received by him in discharge of 415 the debts due from third parties had escaped assessment as the assessee failed to disclose the same. The Income tax Officer issued a notice under section 34 (1) (a) of the Act for the assessment year 1949 50 on the ground that the said sum of Rs. 88	737 had escaped assessment in the said assessment year. After the assessment of that year was set aside under section 27 of the Act	 the Income tax Officer	 ignoring the notice issued by him under section 34 (1)(a) of the Act	 included that amount in the fresh assessment made by him. The assessee preferred an appeal against that order and that was disposed of by the Appellate Assistant Commissioner on December 4	 1957. The Appellate Assistant Commissioner in his order held that the bonds were received by the assessee in the previous accounting year and	 therefore	 directed that the sum representing interest on the bonds should be	 deleted from the assessment for the year ending 1949 50 and included in the assessment for the year ending 1948 49. pursuant to the direction given by the Appellate Assistant Commissioner the Income tax Officer initiated proceedings under section 34(1) of the Act in respect of the assessment year 1948 49. The notice issued under that section was served on the respondent on December 5	 1957. The assessee filed a petition under article 226 of the Constitution in the High Court of Judicature at Allahabad for quashing the said proceedings	 mainly on the ground that the proceedings were initiated beyond the time prescribed by section 34 of the Act. The High Court accepted the contention and quashed the proceedings initiated by the Income tax Officer. Hence the appeal. The proceedings would be in time	 if the second proviso to section 34(3) of the Act could be invoked. The question	 therefore	 is what is the true meaning of the terms of the second proviso to section 34(3) of the Act	. It reads: "Provided further that nothing in this section limiting the time within which any action may be taken	 or any order	 assessment or re assessment may be made	 shall apply to a re assessment made under section 27 or to an assessment or re assessment made on the assessee or any person in consequence of or to give effect to any 416 finding or direction contained in an order under section 31	 section 33	 section 33A	 section 33B. section 66 or section 66A." Prima facie this proviso lifts the ban of limitation imposed by the other provisions of the section in the matter of taking an action in respect of or making an order of assessment or re assessment falling within the scope of the said proviso. The scope of the proviso is confined to an assessment or re assessment made on the assessee or any person in consequence of an order to give effect to any finding or direction contained in any order made under section 31 i.e.	 in an appeal before the Assistant Appellate Commissioner	 under section 33 i.e.	 in an appeal before the Tribunal	 under section 33A i.e.	 in a revision before the Commissioner	 under section 33B i.e. in a revision before the Commissioner against an order of the Income tax Officer	 and under sections 66 and 66A i.e.	 in a reference to the High Court and appeal against the High Court 's order to the Supreme Court. Learned counsel for the appellant contends that the scope of the proviso is only confined to the assessment of the year that is the subject matter of the appeal or the revision	 as the case may be. Learned counsel for the Department argues that the comprehensive phraseology used in the proviso takes in its broad sweep any finding given by the appropriate authority necessary for the disposal of the appeal or the revision	 as the case may be	 and to any direction given by the said authority to effectuate its finding and that the said finding or direction may be in respect of any year or any person. As the phraseology used in the proviso is not clear or unambiguous	 the question raised cannot be satisfactorily resolved without having a precise appreciation of a brief history of section 34 of the Act culminating in the enactment of the proviso in the present form. Under section 3 of the Act	 income tax for any year shall be charged in respect of the total income of the previous year of every assessee. Notice under section 22 calling for return of income is the first step in the assessment proceedings. Two types of notices are mentioned in that section	 namely	 (i) the public notice and (ii) the individual notice. 'Me public notice shall be	 issued on or before the 1st May of each year and the individual notice may be issued at any 417 time in the course of the assessment year. Income tax proceedings	 therefore	 for a particular assessment year have to be initiated in the course of that year. But there may be cases of escaped assessment or under assessment. Section 34 empowers the Income tax Officer to take proceedings under that section both in respect of concealed income and also in bona fide cases where the income has escaped assessment or full assessment. Section 34(1) (a) provides for the initiation of assessment proceedings in respect of concealed income and section 34(1) (b) for other escaped income	 Section 34(1) has been amended from time to time. Under the said section	 as it originally stood	 the Income tax Officer was empowered to initiate proceedings at any time within one year of the end of the year in respect whereof the income escaped assessment. By Act 7 of 1939 that section was amended and eight years ' limitation from the end of the year was prescribed in respect of concealed income and a limitation of four years for other escaped income. Under Act 48 of 1948	 the same periods of limitation were retained	 but certain conditions were imposed. By the Finance Act of 1956	 it was enacted that in the case of concealed income the proceedings could be initiated at any time within 4 years of the end of the relevant assessment year. Though no period of limitation was prescribed in respect of concealed income	 three conditions were imposed	 namely	 (i) that an Income tax Officer shall not issue a notice for any year prior to the year ending on March 31	 1941	 (ii) that if the escaped income was less than rupees one lakh	 he shall not issue a notice if 8 years have elapsed after the expiry of the relevant assessment year	 and (iii) that unless he has recorded his reasons and unless the Central Board of Revenue in any case falling under cl. (2) of the proviso and in any other case	 the Commissioner	 is satisfied that for such reasons as recorded it is a fit case for the issue of a notice. Before 1939	 there was no period of limitation for com pleting the assessment once it had been initiated within the prescribed period of limitation. But Act 7 of 1939 for the first time introduced cl. (2) in section 34 whereunder "no order of assessment under section 23 or of assessment or re assessment under sub section (1) of this section shall be made after the 134 159 section C. 27 418 expiry	 in any case to which (c) of sub section (1) of sec tion 28 applies	 of eight years	 and in any other case	 of four years from the end of the year in which the income	 profits or gains were first assessable". Section 28 (1) (c) dealt with a case of an assessee concealing the particulars of his income or deliberately furnishing inaccurate particulars of his income. Act 23 of 1941 inserted a proviso in section 34(2) providing that "nothing contained in this sub section shall apply to a re assessment made in pursuance of an order under section 31	 section 33	 section 66 or section 66 A"	 i.e.	 provisions relating to appeals	 revisions and references: that is to say	 if the assessment made by the Income tax Officer was set aside and a re assessment was directed to be made	 the said periods of limitation would not apply to such reassessment. Act 48 of 1948 introduced sub section (3) in section 34 in substitution of sub section (2) thereof. Under that sub section the period of limitation prescribed by sub section (2) was retained	 and the proviso to section 34(2) before the amendment was made the second. proviso	 with some modifications	 to the amended sub section While the scope of the previous proviso was confined only to the completion of re assessment proceedings	 the scope of the amended proviso is much wider in that it exempts the subject matter of that proviso from the operation	 of the period of limitation prescribed by the section; that is to say	 it gives full scope to the operation of the substantive part of the section unhampered by the periods of limitation prescribed by sub sections (1)	 (2) and (3) of section 34 of the Act. While the previous proviso lifted the ban only in regard to the period of limitation prescribed for the completion of the assessment	 the new proviso lifted the ban even in respect of the initiation of proceedings under section 34 (1) of the Act. It follows that if a matter fell within the terms of the proviso	 there would be no period of limitation for initiating an action or making an assessment or reassessment in respect of that matter. Briefly stated	 the said proviso is a proviso to the entire section 34. We shall consider the scope of the proviso at a later stage of our judgment. Then came the Finance Act of 1956. It amended section 34 (1) and introduced a proviso to the said sub section	 which we have noticed earlier. That proviso	 while removing the period of limitation in respect of concealed income	 imposed 419 some conditions in respect thereof	 but the four year period of limitation in respect of other escaped income was retained. We are not concerned in this appeal with the subsequent amendments. The history of the section gives us the following background to the proviso under consideration. Broadly stated	 under section 34	 as it existed in 1956	 (i) there was no time limit for initiating proceedings under section 34(1) in respect of con cealed income	 but such initiation could be made only sub ject to the conditions laid down in the proviso to section 34(i); (ii) in the case of other escaped income	 the proceedings could not be initiated after the expiry of 4 years from the end of the relevant assessment year; (iii) the assessment proceedings once commenced shall be completed within the period of limitation prescribed under section 34(3); and (iv) to a case to which the proviso to section 34(3) applies	 there is no period of limitation either for initiating the proceedings under section 34 or for completing the assessment commenced either under section 23 or under section 34(1). With this background let us give a closer look to the relevant terms of the proviso. The first part of the proviso released the operation of the proviso from the restriction imposed by section 34 only in respect of the time limit within which any action may be taken or any order of assessment or re assessment may by made. It means that the proviso continues to be subject to the other restrictions imposed under the section and it cannot override the said provisions in that regard. Under the proviso	 the period of limitation will not apply to a re assessment made under section 27 or to an assessment or re assessment made on the assessee or any person in consequence of or to give effect to any finding or direction contained in an order under section 31	 section 33	 section 33B	 section 66 or section 66A of the Act. It was not contended	 nor was it possible to contend	 that by reason of the reference to the said provisions the powers and jurisdiction conferred on the respective. authorities	 tribunals or courts referred to therein were enlarged or modified by a ' reference in the proviso or that the proviso could be read or construed as amending those sections conferring on those bodies wider or different powers or jurisdiction. Learned counsel for the department expressly disclaimed any such submission. Therefore	 the scope of the proviso cannot ordinarily exceed the scope of the jurisdiction conferred on an authority under the said provisions. It is not	 and cannot be	 disputed that under the Income Lax Act	 year is the unit of assessment. The Judicial Committee in Commissioner of Income tax vs section M. Chitnavis(1) pointed out : "For the purpose of computing the yearly profits and gains	 each year is a separate self contained period	 time	 in regard to which profits earned or losses sustained before its commencement are irrelevant." This Court in Sir Kikabhai Premchand vs Commissioner of Income tax (Central)	 Bombay(1) accepted this legal position when it said: ". . for income tax purposes	 each year is a self contained accounting period and we can only take into consideration income	 profits and gains made in that year and are not concerned with potential profits which may be made in. another year any more than we are with losses which may occur in the future. " Indeed	 the decision of an Income tax Officer given in a particular year does not operate as res judicata in the matter of assessment of the subsequent years. The jurisdiction of the tribunals in the hierarchy created by the Act is no higher than that of the Income tax Officer. It is also confined to the year of assessment. Under section 27 of the Act	 the Incometax Officer cancels the best judgment assessments made by him if the assessee shows that he was prevented by sufficient cause from making the returns under section 22 of the Act. Section 31 prescribes the mode of disposal by an Assistant Appellate Commissioner of an appeal preferred to him: the appeal before him is certainly confined to an assessment year; after hearing the appeal	 he can either confirm	 reduce	 enhance or annul the assessment; he can set aside the (1)(1932) L. R. 59 I. A. 290. 297. (2) 	 222. 421 assessment and direct the Income tax Officer to make a fresh assessment. The various sub sections of that section describe in detail the orders or directions that can be made or issued by him in respect of various matters; but	 no power is conferred on him to make an order or issue directions in respect of an assessment of a year which was not the subject matter of the appeal. It may	 therefore	 be held on a construction of the provisions of section 31	 that the jurisdiction of the Appellate Assistant Commissioner is strictly confined to the assessment orders of a particular year under appeal. Section 33	 inter alia	 deals with an appeal to the Tribunal against the order of the Appellate Assistant Commissioner under section 31; and section 33B confers power of revision on the Commissioner against an order of the Income tax Officer. The jurisdiction of the Appellate Tribunal or the Revisional Tribunal	 as the provisions indicate	 is confined only to the subject matter which is under appeal or revision. The jurisdiction of the High Court or the Supreme Court under section 66 or section 66B	 as the case may be	 is far more limited and it is confined only to the questions referred to them. Obviously the questions referred by the Tribunal cannot exceed its jurisdiction. It is	 therefore	 manifest that assessment or re assessmentmade under the said sections or pursuant to the orders ordirections made thereunder must necessarily relate to the assessment of the year under review	 revision or appeal	 as the case may be. It is important to remember that the proviso does not confer any fresh power upon the Income tax Officer to make assessments in respect of escaped incomes without any time limit. It only lifts the ban of limitation in respect of certain assessments made under certain provisions of the Act and the lifting of the ban cannot be so construed as to increase the jurisdiction of the Tribunals under the relevant sections. The lifting of the ban was only to give effect to the orders that may be made by the appellate	 revisional or reviewing tribunal within the scope of its jurisdiction. If the intention was to remove the period of limitation in respect of any assessment against any person	 the proviso would not have been added as a proviso to sub section (3) of section 34	 which deals with completion of an assessment	 but would have been added to sub section (1) thereof. 422 Now	 let us scrutinize the expressions on which strong reliance is placed for the contrary conclusion. The words relied upon are "section limiting the time"	 "	any person"	 "in consequence of or to give effect to any finding or direction". Pointing out that before the amendment the word "subsection was in the proviso but it was replaced by the expression "section"	 it is contended that this particular amendment will be otiose if it is confined to the assessment year under appeal	 for it is said that under no circumstances the Income tax Officer would have to initiate proceedings for the said year pursuant to an order made by an Appellate Assistant Commissioner. This contention is obviously untenable. The Appellate Assistant Commissioner or the Appellate Tribunal may set aside the notice itself for one reason or other and in that event the Income tax Officer may have to initiate the proceedings once again in which case section 34(1) will be attracted. The expression "finding or direction"	 the argument proceeds	 is wide enough to take in at any rate a finding that is necessary to dispose of the appeal or directions which Appellate Assistant Commissioners have in practice been issuing in respect of assessments of the years other than those before them in appeal. What does the expression "finding" in the proviso to sub section (3) of section 34 of the Act mean? "Finding" has not been defined in the Income tax Act. Order XX	 r. 5 of the Code of Civil Procedure reads: "In suits in which issues have been framed	 the Court shall state its finding or decision	 with the reasons therefor	 upon each separate issue	 unless the finding upon any one or more of the issues is sufficient for the decision of the suit." Under this Order	 a "finding" is	 therefore	 a decision on an issue framed in a suit. The second part of the rule shows that such a finding shall be one which by its own force or in combination with findings on other issues should lead to the decision of the suit itself. That is to say	 the finding shall be one which is necessary for the disposal of the suit. The scope of the meaning of the expression "finding" is considered by a Division Bench of the Allahabad High Court in 423 Pt. Hazari Lal vs Income tax Officer	 Kanpur(1) There	 the learned Judges pointed out: "The word "finding '	 interpreted in the sense indicated by us above	 will only cover material questions which arise in a particular case for decision by the authority hearing the case or the appeal which	 being necessary for passing the final order or giving the	 final decision in the appeal	 has been the subject of controversy between the interested parties or on which the parties concerned have been given a hearing. " We agree with this definition of "finding". But a Full Bench of the same High Court in Lakshman Prakash vs Commissioner of Income tax	 U.P. (2) construed the word "finding" in a rather comprehensive way. Desai	 C.J.	 speaking for the Court	 observed: "A finding is nothing but what one finds or decides and a decision on a question even though not absolutely necessary or not called for is a finding. " If that be the correct meaning	 any finding on an irrelevant or extraneous matter would be a finding. That certainly cannot be the intention of the Legislature. The Madras High Court also in A. section Khader Ismail vs Income tax Officer	 Salem(3) gave a very wide interpretation to that word	 though it did not go so far as the Full Bench of the Allaha bad High Court. Ramachandra Iyer J.	 as he then was	 speaking for the Court	 observed that the word "finding" in the proviso must be given a wide significance so as to include not only findings necessary for the disposal of the appeal but also findings which were incidental to it. With respect	 this interpretation also is inconsistent with the well known meaning of that expression in the legal terminology. Indeed	 learned counsel for the respondent himself will not go so far	 for he concedes that the expression "finding" cannot be (1) (196O) 	 272 (2) (1963) 48 I. T. R. 705	 718. (3) 424 any incidental finding	 but says that it must be a conclusion on a material question necessary for the disposal of the appeal	 though it need not necessarily conclude the appeal. This concession does not materially differ from the definition we have given	 but the difference lies in the application of that definition to the finding given in the present case. A "finding"	 therefore	 can be only that which is necessary for the disposal of an appeal in respect of an assessment of a particular year. The Appellate Assistant Commissioner may hold	 on the evidence	 that the income shown by the assessee is not the income for the relevant year and thereby exclude that income from the assessment of the year under appeal. The finding in that context is that that income does not belong to the relevant year. He may incidentally find that the income belongs to another year	 but that is not a finding necessary for the disposal of an appeal in respect of the year of assessment in question. The expression "direction" cannot be construed in vacuum	 but must be collated to the directions which the Appellate Assistant Commissioner can give under section 31. Under that section he can give directions	 inter alia	 under section 31 (3) (b)	 (c) or (e) or section 31 (4). The expression "directions" in the proviso could only refer to the directions which the Appellate Assistant Commissioner or other tribunals can issue under the powers conferred on him or them under the respective sections. Therefore	 the ex pression "finding" as well as the expression "direction" can be given full meaning	 namely	 that the finding is a finding necessary for giving relief in respect of the assessment of the year in question and the direction is a direction which the appellate or revisional authority	 as the case may be	 is	 empowered to give under the sections mentioned therein. The words "in consequence of or to give effect to" do not create any difficulty	 for they have to be collated with	 and cannot enlarge	 the scope of the finding or direction under the proviso. If the scope is limited as aforesaid	 the said words also must be related to the scope of the findings and directions. The words "any person '	 it is said	 conclude the matter in favour of the Department. The expression "any person"in its widest connotation may take in any person whether connected or not with the assessee	 whose income for any 425 year has escaped assessment; but this construction cannot be accepted	 for the said expression is necessarily Circumscribed by the scope of the subject matter of the appeal or revision	 as the case may be. That is to say	 that person must be one who would be liable to be assessed for the whole or a part of the income that went into the assesment of the year under appeal or revision. If so construed	 we must turn to section 31 to ascertain who is that person other than the appealing assessee who can be liable to be assessed for the income of the said assessment year. A combined eading of section 30(1) and section 31(3) of the Act indicates the cases where persons other than the appealing assessees might be affected by orders passed by the Appellate Commissioner. Modification or setting aside of assessment made on a firm	 joint Hindu family	 association of persons	 for a particular year may affect the assessment for the said year on a partner or partners of the firm	 member or members of the Hindu undivided family or the individual	 as the case may be. lit such cases though the latter are not eo nomine parties to the appeal	 their assessments depend upon the assessments on the former. The said instances are only illustrative. It is not necessary to pursue the matter further. We would	 therefore	 hold that the expression "any person" in the setting in which it appears must be confined to a person intimately connected in the aforesaid sense with the assessment of the year under appeal. We shall now briefly touch upon the conflict of decisions on the question. The Full Bench of the Allahabad ' High Court in Lakshman Prakash 's case(1) overruled the decision of the Division Bench in Pt. Hazari Lal 's case (2). A Division Bench of the Madras High Court consisting of Rajagopalan and Balakrishna Ayyar JJ.	 in Simrathmull vs Additional Income tax Officer	 Ootacamund(3)	 took the same view as the Full Bench of the Allahabad High Court in Lakshman Prakash 's case(4). But a Division Bench of the Calcutta High Court	 consisting of Bose C.J.	 and Mookerjee J.	 in Brindaban Chandra Basak vs Income tax Officer(4)	 though it had not finally expressed any opinion (1) 	 718. (2) 	 272. (3) (4) 426 on that	 was inclined to accept the view expressed by the Division Bench of the Allahabad High Court in Pt. Hazari Lal 's case(1). We have gone through the decisions carefully. For the reasons given by us	 we agree with the view expressed by the Division Bench of the Allahabad High Court in Pt. Hazari Lal 's case(2) on the interpretation of the proviso to sub section (3) of section 34 of the Act. In the result	 we hold that the said provision would not save the time limit prescribed under sub s ' (1) of section 34 of the Act in respect of an escaped assessment of a year other than that which is the subject matter of the appeal or the revision	 as the case may be. It follows that the notice under section 34(1) (a) of the Act issued in the present case was clearly barred by limitation. In this view no other question arises for our consideration. In the result	 the appeal fails and is dismissed with costs. MUDHOLKAR J. This is an appeal by special leave from the judgment of the Allahabad High Court in the writ petition under article 226 of the Constitution quashing a notice under section 34(1) of the Indian Income tax Act	 1922 issued by the appellant	 Income tax Officer	 A Ward Sitapur on December 5	 1957 against respondent No. 4. The relevant facts are briefly these: For the assessment year 1949 50	 correspondiria to Samvat year 2005	 the appellant made an ex parte assessment under section 23(4) of the Act on November 13	 1953 which he later set aside under section 27 of the Act. Before that he had issued a notice to the respondent firm under section 314(1) (a) of the Act in respect of the same assessment year on the ground that a sum of Rs. 88	737 representing interest alleged to have been earned by the firm during that year had escaped assessment in the assessment made under section 23(14). After	 however	 fresh proceedings were taken under section 23 (3) by the appellant consequent upon his order under section 27	 he proceeded to include in the assessment a sum of Rs. 88	737 which was alleged to have escaped assessment in the notice earlier issued under section 34(1) (a) and made an assessment (1) (1963)48I.T.R.705	718. 427 order on January 31	 1957. Against this order the respon dent preferred an appeal before the Appellate Assistant Commissioner in which he urged two main grounds and the one accepted by the Appellate Assistant Commissioner was that the aforesaid amount of interest was received by the firm in the accounting period of the previous assessment year and not in that of the assessment year 1949 50. Upon this view	 the Appellate Assistant Commissioner reduced the assessment and observed as follows in his order : "I	 therefore	 hold that the amount in dispute should be deleted from the assessment for 1949 50 and that	 instead	 the Income tax Officer should take steps to assess the wnount for the assessment year 1948 49." Treating this as a direction or finding of the Appellate Authority	 the appellant issued the impugned notice dated December 5	 1957 under section 34(1) (a). The respondent immediately moved the High Court for quashing the aforesaid notice. The High Court quashed the notice on the ground that it was issued by the appellant beyond the ordinary period of limitation	 overruling the appellant 's contention that no period of limitation governed the notice inas much as the second proviso to section 34(3) of the Act was attracted to the facts of the case. The High Court in doing so purported to follow its own decision in Pt. Hazari Lal vs The Income tax Officer	 Disti. II	 Kanpur(1). Briefly stated	 the view taken by the High Court is that the only direction which the Appellate Assistant Commissioner can competently give is one which is covered by section 31 of the Act and that since the appeal before him was confined to a particular assessment year	 the direction must also be necessarily limited to a matter falling within that year. The High Court further held that if the direction be treated as based on a finding recorded by the Appellate Assistant Commissioner	 that finding will have to be disregarded when applying the proviso. The correctness of the view taken by the High Court is challenged before us on behalf of the appellant. (1) Civil Misc. 2227 of 1956. 428 The relevant part of section 34(3) and the second proviso thereto run thus: "No order of assessment or reassessment	 other than an order of assessment under section 23 to which clause (c) of sub section (1) of section 28 applies or an order of assessment or reassessment in cases falling within clause (a) of subsection (1) or sub section (1A) of this section shall be made after the expiry of four years from the end of the year in which the income	 profits or gains were first assessable: Provided further that nothing contained in this section limiting the time within which any action may be taken or any order	 assessment or reassessment may be made shall apply to a reassessment made under section 27 or to an assessment or reassessment made on the assessee or any per son in consequence of or to give effect to any finding or direction contained in an order under section 31	 section 33	 section 33A	 section 33B	 section 66 or section 66A." This is how the provision stands as from April 1	 1956 and it is not disputed before us that it is the amended provision which would apply to the present case. What is	 however	 contended on behalf of the respondent is that the only issue before an Income tax Officer in every case being the assessment for a particular year and no other year	 the direction or finding contemplated by the second proviso which the Appellate Authority could make must necessarily be limited to that year alone. The alternative contention is that if the second proviso is so construed as to permit of a direction or finding being made with respect to any other year	 it is ultra vires being violative of article 14 of the Constitution. It was further contended that since the amount in this case is below one lakh of rupees	 the second proviso will not apply. As regards the last point we may advert to our judgment delivered today in K. C. Thomas	 First Income tax Officer	 Bombay vs Vasant Hiralal Shah(1) in which we have (1) ; 429 negatived a similar contention. For the reasons given there	 we reject the argument of learned counsel for the respondent. Coming to the first contention of the respondent	 it is no doubt true that the whole scheme of the Income tax Act is to confine the assessment pursuant to the notice given under section 22 to a particular year and particular year alone and in the proceeding before him he is bound to confine himself to the income of that year. If income in previous years has escaped assessment	 he has no power to bring it to assessment along with the income of a subsequent year. The only power which he has for bringing such income to assessment is to resort to the provisions of section 34(1) and issue a separate notice with respect to it to the assessee and the Appellate Assistant Commissioner of Income tax hear ing an appeal from an order of assessment made by the Income tax Officer is in no better position in this matter than the Income tax Officer. All that is perfectly true. But the question which we have to consider is whether the wide language employed by the legislature in enacting the second proviso should not be given its natural meaning. This proviso removes the bar of limitation enacted by section 34(1) and its first two provisos not only with respect to the assessee but with respect to "any person" in certain circumstances. No doubt	 this Court has recently held in section C. Prashar & Anr. vs Vasantsen Dwarkadas & ors.(1) that the proviso in so far as it removes the bar of limitation with respect to persons other than the assessee	 is invalid as it infringes the provisions of article 14 of the Constitution. That	 however	 is a question apart. What we have to consider is the legislative intent	 and for ascertaining it	 it is legitimate to look also at that part of the enactment which has been held to be invalid. By permitting the Appellate Authority to make a finding or give a direction with respect to a person other than the assessee the Legislature has made it abundantly clear that for bringing escaped income to assessment the bar 	of limitation would not apply provided there is a finding or direction of the Appellate Authority that a particular item 	of income had escaped assessment and may	 therefore	 be brought to assessment. Under the operative portion of section 34(1)	 the Income tax Officer is empowered to give notice (1) [1964] 1 S.C.R. 29. 430 to an assessee in respect of escaped assessment. He can issue such notice under cl. (a) thereof where income has escaped assessment due to any conduct on the part of the assessee and in such a case he can issue a notice at any time. Certain restrictions	 however	 have been placed upon his power by the first proviso to sub section (1) of section 34	 one of which is the period of limitation of eight years with respect to income of less than a lakh of rupees. The second proviso to sub section (3) is a proviso to the whole of section 34 and would consequently apply to a case falling under section 34(1) (a). The restrictions placed by the enacting provisions of section 34(3) would not	 as made clear in the second proviso	 apply to such a case. Thus	 the proviso in terms says that when a notice is issued under section 34(1) (a)	 no question of limitation would arise when such notice is issued in pursuance of a direction or finding of an appellate authority. Since the proceeding in pursuance of a notice under section 34 is necessarily independent of the assessment proceedings under section 22 with respect to a particular year	 the proviso in question need not be so interpreted as to be limited to a direction made by the Appellate Authority while dealing with an appeal for that particular year. The fact that certain income has escaped assessment may come to the notice of an Appellate Authority in any case and it clearly appears to be the intention of the Legislature to require an Income tax Officer to take cognizance of it in the circumstances stated in the proviso. It is	 however	 contended that the power of the Appellate Authority to make a direction or finding in any appeal be fore it is confined to matters specified in section 31 and that upon a proper construction of that provision	 a direction or finding with respect to income of any particular year other than the one with respect to which there is an appeal before it	 cannot be competently made by the Appellate Authority. In support of this contention reliance is placed up on the decisions in Kamlapat Motilal vs Income tax Officer and anr.(1)	 Hiralal Amritlal Shah vs K. C. Thomas	 Income tax Officer	 Bombay (2) ; Pt. Hazari Lal vs Income tax Officer	 Dist. II Kanpur(3); Brindaban Chandra Basak vs Income tax (1) (2) (3) (196O) 431 Officer(1). In the first of these cases the learned judges have observed : "In our opinion the powers of the Appellate Tribunal under section 3 3 (4) are limited to the passing of such order as it thinks fit to make in the proceedings which are then before it on appeal	 and in our judgment it has no power under this section to pass an order or give directions with reference to the proceedings of an earlier year which are concluded. " We may point out that section 33 (4) only refers to a finding or direction made by an Appellate Authority and does not itself confer any power on an Appellate Authority to make a finding or direction. Indeed	 section 34 deals with entirely a different aspect	 that of empowering an Income tax Officer to bring to assessment escaped income	 and ha(; no concern with the powers of an Appellate Authority. The provisions which deals with the powers of an Appellate Authority is section 31 and it is with that provision that we must concern ourselves primarily. The next case is not strictly relevant to this point. But the third one which is again a decision of the Allahabad High Court has proceeded to construe section 31 of the Act and we	 therefore	 have to consider it. After observing that the scope of the orders which can be passed by the Appellate Authority under section 31 the learned Judges have observed: "The very fact that the Appellate Assistant Commissioner of Income tax	 when making an order under section 31	 is dealing with an appeal filed by an assessee in respect of an assessment order indicates the scope of his jurisdiction to give findings and to make consequential orders: The various orders	 which an Appellate Assistant Commissioner of Income tax can make	 are detailed in section 31(3) though there is no detailed provision about the findings which he can record. It appears to us	 however	 that	 (1) 432 from the very nature of the jurisdiction which an Appellate Assistant Commissioner of Incometax exercises	 it must follow that his power of recording findings is limited to matters which he is called upon to decide when passing an order in appeal in conformity with the details laid down in section 31(3). Any order passed by him	 which is beyond the scope of section 31(3)	 would be an order without jurisdiction and	 similarly	 any finding recorded by him	 which is not necessary for the purpose of making an order covered by section 31(3)	 would be a finding without jurisdiction. Further ' when applying the second proviso to section 34(3) of the Income tax Act	 the Income tax Officer is only competent to take into account orders which are in conformity with the provisions of section 31(3) and findings which are necessary for passing those orders. Orders	 which are outside the scope of section 31(3) or findings which are not at all necessary for making such orders	 cannot be taken into account by the Income tax Officer for the purpose of relying on the second proviso to section 34(3) which we are now considering." (p. 271) The learned Judges have proceeded to hold that the word "finding" must be given the same meaning as that in the Code of Civil Procedure	 that is. a decision of the Court. In other words	 they seem to hold that a finding means only the final conclusion in the case. In support of this conclusion they placed reliance upon section C. Prashar vs Vasantsen Dwarkadas(1). Section 31(3) of the Act confers certain express powers upon the Appellate Authority	 one of which is to 'confirm. reduce	 enhance or annul the assessment. This power can be exercised only after the Appellate Authority arrives at some conclusions on facts. Thus	 if an assessee wants to be exonerated from tax with respect to a particular item of (1) 433 income and sets out the grounds on which he bases his claim for exoneration the Appellate Authority has to consider them and arrive at its findings with regard to them before it can reduce or annul the assessment. It would follow	 therefore	 that the power to confirm	 reduce	 enhance or annul an assessment is implicit in the power of giving findings on the grounds on which a claim is made for one or the other of these results by the department or the assesee. No express mention of such power was required in section 31(3). When an appeal is before an Appellate Authority the whole matter is at large before it and	 therefore	 when a	 specific case is put before it by an assessee it has both the power as well as the duty to give its finding thereon. The ground given by the assessee for claiming a reduction or annulment of assessment may well be that the income upon which he has been assessed was not earned in the accounting period of the year to which the assessment pertains but in respect of a specified earlier or later year. The Appellate Authority is entitled to go into the whole question and come to a finding one way 'or the other	 whether the income was earned in the year in which it was alleged by the assessee to have been earned or in the year with respect to which he has been assessed by the Income tax Officer. To give a finding on this question would be obligatory upon the Appellate Authority and his duty to give a finding must necessarily be referable to the provisions of section 31(3). We cannot accept the view of the Allahabad High Court that the word "finding" occurring in section 34(3) is susceptible of only one meaning	 and that is that ascertainable from the Code of Civil Procedure. The finding of a tribunal is its conclusion on a point agitated before it and for a conclusion to amount to a finding it is not necessary that it should be the final and ultimate conclusion. We are	 therefore	 unable to accept the view taken by the Allahabad High Court. The last mentioned case does not decide the matter finally. But there the learned Judges have expressed a preference for the view taken by the Allahabad High Court as against that taken by the Madras High Court in K. Simrathmull vs Additional Income tax Officer	 Ootacamund(1). In that case a similar argument to that urged before us and before the (1)(1959) 134 159 section C.28. 434 Allahabad High Court was advanced. Dealing with it the learned Judges have observed: "To support this argument no authority was cited and it appear to us to be completely untenable. When an assessment is made and either the Department or the assessee appeals	 the whole matter would be before the Assistant Commissioner	 and	 no express provision would be necessary to enable him to give directions in respect of a matter already before him. This would apply also to the Commissioner and the Income tax Appellate Tribunal." (p. 47) They then explained the reason for an express provision like the one contained in section 34(3) by saying that it was necessary to have such provision so as to enable the Income tax Officer to take action in pursuance of a finding recorded or direction given by an Apellate Authority. Finally they observed: "To construe the proviso in the manner in which Mr. Subbarya Aiyar invited us to do would be to make that proviso otiose. " With these observations we concur. This decision has been followed by the Bombay High Court in	 General Construction and Supply Co.	 vs Income tax Officer (8th) C. Ward	 Bombay(1). The same High Court has reaffirmed the view taken in Simrathmull 's case(1) in A. section Khader Ismail vs Income tax Officer	 Salem(2) and held that the word "finding" in the proviso to section 34(3) must be given a wide significance so as to include not only findings necessary for the disposal of the appeal but also findings which are incidental to it and would include its conclusion as to whether the income in question in the appeal was not received during the	 year to which the appeal relates. Upon this view the High Court held that if in pursuance of such a finding	 the Income tax Officer proceeds to investigate afresh as to in which year the income was received	 the action of the Income 	ax Officer (1) (2) (3) 435 would still be the result of or the logical consequence of the finding arrived at for the purpose of the disposal of the appeal and the proviso to section 34(3) would apply to such a case. The view taken by the High Court is in our judgment correct. Thus in our view upon a construction of the relevant provisions we have no doubt that the notice was not in contravention of the provisions of section 34 of the Income tax Act and could not be quashed on that ground. The question then remains whether the second proviso below section 34(3) is bad as offending article 14 of the Constitution. In support of this contention reliance is placed by Mr. Bishan Narain for the respondent on the decisions of this Court in Suraj Mall Mohata & Co. vs A. V. Visvanatha Sastri & anr. (1) and section C. Prashar & anr. vs Vasantsen Dwarkadas & ors. In the first case it was held that both section 34 of the Income tax Act and sub section (4) of section 5 of the Taxation on Income (Investigation Commission) Act	 1947	 deal with all persons who have similar characteristics and similar properties	 that the procedure prescribed in the later Act is substantially more prejudicial and more drastic to the assessee than the procedure under the former Act and that	 therefore	 sub section (4) of section 5 of the former Act in so far as it affects the persons proceeded against thereunder is void as offending the provisions of article 14 of the Constitution. On the analogy of this case learned counsel contends that the second proviso to section 34(3) enabling a notice to issue only to an assessee in respect of escaped income without limit of time on the ground that an Appellate Authority has made a finding or direction in the proceeding before it makes a discrimination against such an assessee because it does not lift the bar of limitation with regard to other assessees	 similarly situate	 but with regard to whom no finding has been made or direction given by an Appellate Authority. No doubt	 persons whose income have escaped assessment	 and the fact that they have escaped assessment has not been discovered till after the lapse of eight years from the year in which they could have been assessed to tax on such (1) ; (2) [1964] I section C. R. 29. 436 income	 can be placed in one class. But surely it does not follow that even in that class there can be no further classification. The legislature in enacting the particular provision has made a further or a sub classification by puttinunder one head those whose assessments have come up for scrutiny before an Appellate Authority and with respect to whose escaped assessment a judicial finding or direction is made by the Appellate Authority and under another head other assessees whose escaped income was not detected by the Appellate Authority and with respect to which no judicial finding or direction was	 therefore	 made by such authority. There is a real difference between the two categories of assessees. Prima facie there is reasonable basis for the sub classification and the grounds on which it is made	 that is	 discovery by a higher Income tax Authority and a judicial finding or direction made with respect to the fact by it. These grounds have a rational relationship with the object which was intended to be achieved by the law. that is. to detect and brine to assessment the escaped income. (See for example A. Thangal Kunju Musaliar vs M. Venkitachalam Potti & anr. (1) where a further classification of war porfiteers into those who had evaded substantial amount of income tax and those whose evasion was not of a substantial amount was upheld.) We can find nothing in the decision upon which reliance is placed which runs counter to our view. On the other hand we find ample support from the decision in Balaji vs Income. tax Officer	 Special Investigation Circle (2) where it has been pointed out that the two tests of permissible classification under article 14 are (a) that the classification must be founded on an intelligible differentia and (b) that the differentia must be reasonably connected with the object of the legisla tion	 and that where they are satisfied by a statute. it does not violate article 14 of the Constitution. As regards the other decision relied upon	 it is sufficient to point out that the majority of the learned Judges have only struck down that part of the proviso which enables a notice to issue "to any person" on the ground that it is violative of article 14. The precise question which we have before us does not appear to have been the subject of decision in that case. We (1) ; (2) ; 437 are	 therefore	 unable to accept the contention of learned counsel. For the foregoing reasons we allow the appeal and quash the writ of certiorari issued by the High Court. It may be mentioned that in the absence of a stay of proceedings by the High Court the Income tax Officer has actually made an assessment in pursuance of the impugned notice. That assessment willstand unless it is modified or annulled in any proceeding permitted by law. Costs of the appeal and the petition before the High Court will be borne by the respondent. ORDER BY COURT In view of the judgment of the majority	 the appeal fails and is dismissed with costs.

The respondent was a firm carrying on business in different lines. It was assessed to income tax under section 23(4) of the Income tax Act	 1922 for the assessment year 1949 50 on the ground that notices issued under section 22(2) and (4) had not been complied with. Later on	 that assessment 412 was cancelled. However	 before the cancellation	 it was found that an interest income of Rs. 88	737 in the shape of U.P. Encumbered Estates Act Bonds received by the respondent from third parties had escaped assessment as the assessee failed to disclose the same. The Income tax Officer issued a notice for the assessment year 1949 50 on the ground that a sum of Rs. 88	737 had escaped assessment in the said assessment year. After the cancellation of the assessment made under section 23(4)	 the Income tax officer	 ignoring the notice issued by him under section 34(1)(a)	 included that amount in the fresh assessment made by him for the year 1949 50.The respondent appealed to the Appellate Assistant Commissioner who ordered the deletion of the sum of Rs. 88	737 from the assessment for the year 1949 50 and directed the same to be included in the assesment for the year ending 1948 49. Pursuant to the direction given	 the Income tax Officer served a notice on the respondent under section 34(1). Against that notice the assessee filed a writ petition in the High Court for quashing the above mentioned proceeding on the ground that these were initiated beyond the time prescribed by a. 34. The High Court accepted the petition and quashed the notice on the ground that it was issued by the appellant beyond the ordinary period of limitation It also overruled the contention of the appellant that no period of limitation governed the notice in as much as the second proviso to section 34(3) was attracted to the facts of the case. The only direction which the Appellate Assistant Commissioner could give was one which was covered by section 31 of the Act and as the appeal before him was confined to a particular assessment year	 the direction must necessarily be limited to a matter falling within that year. if the direction be treated as based on a finding recorded by Appellate Assistant Commissioner	 that finding would have to be disregarded when applying the proviso. The appellant came to this Court by special leave. Held: (per B. P. Sinha	 C.J.	 K. Subba Rao and N. Rajagopala Ayyangar JJ.). The proviso to sub section (3) of section 34 of the Indian Incometax Act	 1922 does not save the time limit prescribed under sub section (1) of section 34 in respect of an escaped assessment of a year other than that which is the subject matter of appeal or revision as the case may be and hence the notice under section 34(1)(a) issued in the present case was clearly barred by time. The jurisdiction of the High Court or the Supreme Court under section 66 or section 66(b) is a limited one and is confined only to the questions referred to them. Moreover	 the questions referred by Tribunal cannot exceed its jurisdiction. Therefore the assessment or reassessment made under the said sections or Pursuant to the orders or directions made thereunder must necessarily relate to the assessment of the year under review	 revision or appeal as the case may be. 'Me proviso to sub section (3) of section 34 does not confer any fresh power upon the Income tax Officer to make assessment in respect of the escaped incomes without any time limit. It only lifts the ban of limitation in respect of certain assessments made under certain provisions of the Act and the lifting of the ban cannot be so construed as to increase the jurisdiction of the tribunal Under the 413 relevant sections. The lifting of the ban was only to give effect to the orders that may be made by the appellate	 revisional or reviewing Tribunal within the scope of its jurisdiction. If the intention was to remove the period of limitation in respect of any assessment against any person	 the proviso would not have been added as proviso to sub section (3) which deals with completion of an assessment but would have been added to sub section (1) of section 34. The word 'finding ' covers only the material questions which arise in a particular case for decision by the authority hearing the. case or the appeal which	 being necessary for passing the final order or giving the final decision in the appeal	 has been the subject of controversy between the interested parties or on which the parties concerned have been given a hearing. The expression 'direction ' refers to a direction which the appellate or revisional authority is empowered to give under the law. The expression "any person" must be confined to a person intimately connected with the assessment of the year under appeal or revision. Held: per Raghubar Dayal and J. R. Mudholkar JJ. (dissenting): That the notice was not in contravention of the provisions of section 34 and hence could not be quashed on that ground. When an appeal is before an appellate authority	 the whole matter is at large before it and there fore when a specific case is put before it by an assessee	 it has both the power as well as the duty to give its finding thereon. The ground given by an assessee for claiming a reduction or annulment of assessment may be that the income upon which he had been assessed was not earned in the accounting period of the year to which the assessment pertained but in respect of a specified earlier or later year. The appellate authority is entitled to go into the whole question and come to a finding one way or the other. The finding of a tribunal is its conclusion on a point agitated before it and for a conclusion to amount to a finding	 it is not necessary that it should be the final and ultimate conclusion. The contention of respondent that the second proviso to a. 34(3) enabling a notice to issue only to assessee in respect of escaped income without limit of time on the ground that the appellate authority has made a finding or direction in the proceeding before it makes a discrimination against such assessee because it does not lift the bar of limitation with regard to other assessees similarly situated but with regard to whom no finding has been made or direction given by appellate authority	 was rejected. It was held that prima facie	 there was a reasonable basis for the classification. The ground on which classification was made had a rational relationship with the object which was intended to be achieved by law	 ie.	 to detect and bring to assessment the escaped income. Commissioner of Income tax vs section M. Chitnavis	 (1932) L.R. 59 I.A. 290	 Sir Kikabhai Premchand vs Commissioner of Income tax (Central)	 Bombay	 pt. Hazart Lal vs Income tax Officer	 Kanpur. Lakshman Prakash vs Commissioner of Income 414 tax	 U.P.	 	 A. section Khader Ismail vs Income tax Officer	 Salem	 (1963)48 I.T.R. 16	 Simrathmul vs Additional Income tax Officer	 Ootachamund	 (1959)36 I.T.R. 41	 Brindaban Chandra Basak vs Incometax Officer	 	 K. C. Thomas	 First Income tax Officer. Bombay vs Vasant Hira Lal Shah 	 Prashar & Anr. V. Sasantsen Dwarkadas 49 I.T.R. (S.C.) 1	 Kamlapat Hotilal vs Income tax Officer	 	 Hiralal Amrit Lal Shah vs K. C. Thomas	 Income tax Officer	 Bombay	 	 General Construction and Supply Co. vs Income tax Officer (8th) C Ward	 Bombay	 	 Suraj Mal Mohata & Co. vs A. V. Visvanatha Sastri ; 	 A. Thangal Kunju Mudaliar vs M. Venkatachalam Potti & Anr. ; and Palaji vs Income tax Officer	 Special Investigation Circle ; 	 referred to.