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K.U. Srinivasa Rao Vs. Commissioner of Wealth Tax - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtAndhra Pradesh High Court
Decided On
Case NumberW.T.C. Nos. 4 of 1984 and 7 of 1983
Judge
Reported in(1985)46CTR(AP)256; [1985]152ITR128(AP)
ActsWealth Tax Act - Sections 17A and 27(3)
AppellantK.U. Srinivasa Rao
RespondentCommissioner of Wealth Tax
Excerpt:
direct taxation - assessment order - sections 17a and 27 (3) of wealth tax act - assessment order dated 31.03.1979 served on assessee on 20.04.1979 - on which date notice deemed to have been passed - assessment had to be made on or before 31.03.1979 - act merely required that assessment order shall be made within prescribed period - not further required that it should be communicated within period prescribed - assessment order deemed to have been passed on 31.03.1979. - .....whether, the right to receive the kist in respect of kalipatnam estate which is in dispute on the valuation date can be taken as an asset (b) whether, the interest on the kist which is in dispute in the civil court can be taken as an asset (c) if the answer to the above (a) and (b) points is in the affirmative, whether 50% of the kist amount and interest thereon claimed by the plaintiffs represent the market value as on the valuation date though the matter is still in dispute in the court on the valuation date 2. (a) whether, the interest awarded by the civil court under s. 28 of the land acquisition act in respect of the rajahmundry lands, can be included in the net wealth till it is finally determined by the court (b) in the circumstances of the case, whether 50% of the enhanced.....
Judgment:

Jeevan Reddy, J.

1. In these two applications, the assessee is requesting this Court to refer the following three questions for the opinion of this Court under s. 27(3) of the WT Act :

'1. (a) Whether, the right to receive the kist in respect of Kalipatnam estate which is in dispute on the valuation date can be taken as an asset

(b) Whether, the interest on the kist which is in dispute in the Civil Court can be taken as an asset

(c) If the answer to the above (a) and (b) points is in the affirmative, whether 50% of the kist amount and interest thereon claimed by the plaintiffs represent the market value as on the valuation date though the matter is still in dispute in the court on the valuation date

2. (a) Whether, the interest awarded by the Civil Court under s. 28 of the Land Acquisition Act in respect of the Rajahmundry lands, can be included in the net wealth till it is finally determined by the court

(b) In the circumstances of the case, whether 50% of the enhanced compensation and interest thereon awarded by the Hon'ble High Court represents the correct market value as on the valuation date when the matter is in dispute on the valuation date

3. (a) Whether, the assessment order dt. 32-3-1979, but served on the assessee on 20-4-1979, is deemed to have been passed in the eye of law on 20-4-1979, and hence, barred by limitation under s. 17A of the WT Act

(b) If the answer to the above question is in the negative, whether for the purpose of limitation the date of despatch of the order by the officer is the date of passing the order and if so, on the facts and circumstances of the case, the orer is barred by limitation ?'

2. So far as questions Nos. 1 and 2 are concerned, it is fairly conceded by Sri S. Dasaratharama Reddy, the ld. counsel for the assessee-petitioner, that they are concluded against the assessee by the decision of this court in CWT v. Amatul Kareem. It is, therefore, unnecessary to dilate upon these two questions.

3. We shall deal with the third question referred. In these cases the assessment years relevant are 1973-74 and 1974-75. The question of limitation arises in the following facts :

The assessment with respect to both these assessment years had to be made on or before 31-3-1979. The assessee's he received the orders of assessment only on 20-4-1979, though they are purported to have been made on 31-3-1979. The contention is that an assessment order is deemed to have been made only on the date it is served upon the assessee and, if so, the orders must be deemed to have been made on 20-4-1979, and are, therefore, beyond the period of four years prescribed by s. 17A(1)(a). We are not prepared to agree. Section 17A(1)(a), in so far as it is relevant, reads as follows :

'(1) No order of assessment shall be made under s. 16 at any time after the expiration of a period of -

(a) four years commencing on and from the 1-4-1975, or one year from the date of the filing of a return or a revised return under s. 15, whichever is later, where the assessment year commencing from that date.'

4. The word to be noticed is 'made.' It must be remembered that an order of assessment is not an administrative order but a quasi-judicial order. It is true that an order of assessment may not have been made in the presence of the assessee and that it requires to be communicated, but still, its kept in mind while interpreting the word 'made.' The Act merely requires that an order of assessment shall be made within the prescribed period. It does not further require that it should be communicated within the period prescribed. Mr. Dasaratharama Reddy relied upon the decision of the Supreme Court in CWT v. Kundan Lal Behari Lal : [1975]99ITR581(SC) , where the word 'issued' occurring in s. 18(2A) confers a right on the assessee to seek waiver or reduction of the penalty if he files a return before the WTO 'issues' the notice. We are afraid, the principle of the said judgment can have no application here for more than one reason, that not only the expression construed is different, but that there is also a distinction between a notice and an order of assessment. Mr. Dasaratharama Reddy then relied upon the decision of the Supreme Court in State of Punjab v. Khemi Ram : [1970]2SCR657 . There the expression which fell for construction was the word 'communicate'. The question was, when does an order of suspension pending enquiry passed against a government servant take effect It must be remembered that an order of suspension pending enquiry is not a quasi-judicial order but an administrative order. Even there, the Supreme Court held that the word 'communicate' cannot be interpreted to mean that the order would become effective only on its receipt by the concerned government servant. It was held that the communication is complete once the order is put in the course of transmission and thus goes out of the control of the authority passing it. Be that as it may, the said principle applicable in the case of administrative orders cannot be extended to or applied in the case of quasi-judicial orders passed by the authorities in exercise of their quasi-judicial function. Indeed, we may refer to a decision of this Court in Kodidasu Appalaswamy & Suryanarayana v. CIT : [1962]46ITR735(AP) in this behalf. There the order of assessment had to be made on or before 31-3-1957. It was purported to be made on 29-3-1957. It was purported to be made on 29-3-1957, but was actually served on 6-4-1957. The contention raised there was identical to the one raised here, viz., it must be deemed to have been made only on 6-4-1957, the date on which it was served upon the assessee. This contention was rejected and it was held that the order must be deemed to have been made on the date on which it purports to have been made. Mr. Dasaratharama Reddy contended that this decision requires reconsideration in the light of the decisions of the Supreme Court in CWT v. Kundan Lal Behari Lal (1957) 99 ITR 581 and State of Punjab v. Khemi Ram : [1970]2SCR657 . We are not prepared to agree for the reasons already assigned. In CWT v. Kundan Lal Behari Lal (1957) 99 ITR 581 and State of Punjab v. Khemi Ram : [1970]2SCR657 . We are not prepared to agree for the reasons already assigned. In CWT v. Kundan Lal Behari Lal : [1975]99ITR581(SC) , the language was different and the other decision of the Supreme Court pertains to administrative orders. For the above reasons, these two WTCs are dismissed. No costs.


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