36 SUPREME COURT REPORTS [l969J 2 S.C.R. ( c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or ( d) affect any penalty, forfeiture or punislunent incurred in respect of any offence committed against any enactment so repealed; or ( e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture, or punishment as aforesaid; and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punislunent may be imposed as if the repealing Act or Regulation had not been passed." As regards the second item in the impugned notice, viz., tax in respect of assessment year 1961-62 to the extent of Rs. 485.55 the material facts are as follows : The assessment proceedings were taken and concluded under the old Act and tax of Rs. 2,947.56 was imposed and demanded. Thereafter, the respondent preferred an appeal to the Appellate Assistant Commissioner. In appeal the tax liability was reduced to Rs. 485.55. Thereupon the Income Tax Officer issued a notice to the respondent dated December 11, 1963 purporting to be under s. 156 of the new Act. The limit of 35 days for payment of the amount expired on January 22, 1964. The impugned notice under s. 226(3) was issued nearly two years thereafter on April 23, 1965. The argument on behalf of the respondent was that both the assessment order as well as the appellate order having been made under the old Act, the provisions of s. 226 of the new Act were not applicable. The High Court has accepted this contention of the respondent and has held that the notice was invalid to the extent it included the tax of Rs. 485.55 for the assessment year 1961-62. The contention of the appellant is that the High Court was in error in holding that ~ction under s. 226 of the new Act was possible only in the case of an assessee who was "in default" and that in the case of an assessment under the .old Act, no notice under s. 156 of the new Act was possible and there was no way of taking advantage of the provisions for recovery and collection of tax contained in ss. 220 to 234 of the new Act. In our opinion, the argument on behalf of the appellant is well-founded and must be accepted as correct. In the first place, it is necessary to notice that s. 220 ( 4) of the new Act mentions in what circumstances the assessee shall be deemed to be in default and s. 222 provides that when an assessee is in default or is deemed to be in default in making payment of tax, the Income Tax Officer may forward to the Tax Recovery Officer a certificate under his signature
