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Bhupendra Singh Vs. Agricultural Income Tax Officer and ors. - Court Judgment

LegalCrystal Citation
SubjectDirect taxation
CourtRajasthan High Court
Decided On
Case NumberFull Bench Civil Miscellaneous Writ No. 163 of 1963
Judge
Reported in1970WLN778
AppellantBhupendra Singh
RespondentAgricultural Income Tax Officer and ors.
DispositionApplication allowed
Cases ReferredNarayan Chetty v. I.T. Officer
Excerpt:
rajasthan agricultural income tax, 1953 - section 34(2)--'within such period, not being less than 30 days, as may be specified in the notice'--meaning of--notice requiring to submit returns within 30 days--whether it is a valid notice.;the notice given by the agricultural income-tax officer requiring the petitioner to submit return within 30 days was not in conformity with the provisions of section 34 of the act and was bad in law and that there was no foundation for the initiation of the assessment proceedings by the agricultural income-tax officer, and that the proceedings relating to assessment and the assessment orders are without jurisdiction and unsustainable. - section 2(k), 2(1), 7 & 40 & juvenile justice (care and protection of children) rules, 2007, rule 12 & 98 & juvenile.....l.n. chhangani, ag. c.j.1. this application raising a question relating to the interpretation of the words 'within such period, not being less than 30 days, as may be specified in the notice' in section 34 sub-section (2) of the rajasthan agricultural income tax act, 1953 (hereinafter referred to as the act) has been referred to this full bench by a division bench. the reference has been made as the bench hearing the writ application did not feel inclined to agree with the interpretation of similar words namely, 'within a period of not less than one month' in section 14(2) of the rajasthan municipalities act (hereinafter to be referred to as the municipalities act), and 'within a period of not less than one month' used in section 3(2) of the rajasthan agricultural produce markets act,.....
Judgment:

L.N. Chhangani, Ag. C.J.

1. This application raising a question relating to the interpretation of the words 'within such period, not being less than 30 days, as may be specified in the notice' in Section 34 Sub-section (2) of the Rajasthan Agricultural Income Tax Act, 1953 (hereinafter referred to as the Act) has been referred to this Full Bench by a Division Bench. The reference has been made as the Bench hearing the writ application did not feel inclined to agree with the interpretation of similar words namely, 'within a period of not less than one month' in Section 14(2) of the Rajasthan Municipalities Act (hereinafter to be referred to as the Municipalities Act), and 'within a period of not less than one month' used in Section 3(2) of the Rajasthan Agricultural Produce Markets Act, 1961 (hereinafter referred to as the Markets Act) in two earlier Bench decisions of this Court in Suresh Chandra and Ors. v. Birdhi Chand and Ors. ILR (1965) (15) Raj 793 and Bhikam Chand and Ors. v. The State and another ILR (1965) 15 Raj 897, and entertained doubts about the soundness of the view adopted in these two cases and considered necessary an examination of the controversy by a Full Bench.

2. The facts relevant for deciding the writ application as also answering the reference may be stated as follows:

3. On the 27th of January, 1960, a notice was issued against Thakur Mangal Singh the predecessor-in-interest of the petitioner Bhupendra Singh under Section 54 of the Act calling upon him to submit his return for the agricultural income for the year ending 31st of March, 1954. By a like notice issued on the same day, he was also asked to submit his return for the agricultural income for the year ending 31st of March, 1955. By these notices, Mangal Singh was required to submit the necessary returns 'not later than 26th February, 1960 or within thirty days of the receipt of this notice'. Thakur Mangal Singh did not submit any return in response to these notices and consequently, the Agricultural Income-tax Officer, by his order dated 25th March, 1960, made an exparte assessment against him by which he assessed him to a tax of Rs. 2,499 97 for the assessment year 1954-55 and to an exactly identical amount for the following year 1955-56. Thakur Mangal Singh died on 6th January, 1961. After his death, the petitioner received notices requiring him to deposit the amounts under the above two assessments The petitioner on receipt of the notices filed an application under Article 226 of the Constitution challenging the validity of the two assessments. During the hearing of the writ application the petitioner pressed only one point, namely, that the notice to the assessee dated 27th January, 1960, under Section 54 of the Act was altogether invalid being in contravention of the provisions of Section 34(2) of the Act. It was contended that while Section 54 read with Section 34(2) of the Act required that the notice to the assessee must give him time to file return 'within such period not being less than 30 days, as may be specified in the notice', the notice dated 27th January, 1960. required him to submit the return 'not later than 26th February,l960' or 'within30days of the receipt of the notice' The notice having been served on the assessee on 30th January, 1960 both the points of time in the notice, namely, 26th of February or 'within 30 days of the receipt of the notice,' did not give the assessee a period of not less than 30 days. Consequently, it was urged that the notice was illegal and wholly insufficient to serve as any valid foundation for the lawful assessment tax of the petitioner's father. Before the Division Bench, Commissioner of Income-tax v. Ekbal and Co AIR 1945 Bom. 316 was relied upon. In the Bombay case AIR 1945 Bom. 316 it was held that the expression 'not less than 30 days' could not be equated with the expression 'within 30 days'. The Bench hearing the writ application considered the Bombay case AIR 1945 Bom. 316 as affording an almost exact parallel to the present case and felt no hesitation in following it. The Bench was, however, faced with a Bench discision of this Court in Sureh Chandra and Ors. v. Birdhi Chand and Ors. ILR (1965) (15) Raj 793. In Suresh Chandra's case ILR (1965) (15) Raj 793 Section 14(2) of the Municipalities Act required the draft of the order under Sub-section (1) to be published for filing objections thereto within a period of not less than one month and a notification issued under Section 14(2)'objections within one month' was held valid conforming to the requirements of this section. In this judgment, the expression 'within a period of not less than 30 days' was treated as equivalto the expression 'within 30 days'. It was further observed that the observations of the Bombay High Court in Commissioner of Income Tax v. Ekbal and Co. AIR 1945 Bom. 316 did not square with the observations of the Supreme Court in (H. H. Raja) Harinder Singh v. S. Karnail Singh and Ors. : [1957]1SCR208 . It may also be mentioned that the same Bench on the same day interpreted the similar words in the Markets Act in the same manner vide their decision reported in Bhikam Chand and Ors. v. The State and another ILR (1965) 15 Raj 897.

4. The Bench hearing the writ application noticed the Supreme Court Case AIR 1957 SC 271 in detail and considered the two Bench decisions of this Court. The Bench felt inclined to disagree with the view adopted in the two Bench decision and found force in the following contentions made before it:

1. That the Supreme Court case affords no parallel to the Bombay case and the case before the Bench and that the authority of the Bombay case is not shaken by the decision of the Supreme Court.

2. That the expression 'within a period of not less than 30days' could not be properly interpreted as amounting to same thing as 'within one month' even on the law quoted in Suresh Chandra's case ILR (1965) (15) Raj 793, from Asalsbury's Laws of England. Third Edition, Volume 37, on pages 94 97, and Maxwell's Interpretation of Statues, Eleventh Edition, at page 394, and that the expression 'within such period not being less than 30 days' cannot be rightly accepted as being equivalent to 'within 30 days'.

Naturally, the Bench entertained doubts about the soundness of the view adopted by the Bench in the two cases--Suresh Chandra v. Birdhi Chand ILR (1965) (15) Raj 793 and Bhikamchand v. The State ILR (1965) 15 Raj 897 and considered it necessary to have the controversy examined by a Full Bench. At the out set, it will be useful to notice the Bombay decision in Commissioner Income-tax v. Ekbal and Co. AIR 1945 Bom. 316 and the Supreme Court decision in (H.H.Raja) Harinder Singh v. S. Karnail Singh and Ors. : [1957]1SCR208 which was construed by the Bench of this Court in Suresh Chandra't case ILR (1965) (15) Raj 793 as weakening the authority of the Bombay decision in Commissioner of Incom-tax v. Ekbal and Co. AIR 1945 Bom. 316. In the Bombay case AIR 1945 Bom. 316 a Division Bench consisting of Stone C. J. and Kania J. was interpreting the words 'within such period not being less than 30 days,' appearing in Section 22(2) of the Income Tax Act of 1922 and was considering the validity of a notice requiring the assessee to file the return within 30 days of the receipt of this notice. Both the learned Judges held the notice invalid. Stone C.J observed,:

Time can be indefinitely divided There is no fraction of a second which is so short duration that it cannot be divided into something smaller. In my judgment expressions 'within 30 days' & 'not less than 30 days' are two quite different things. 'Within 30 days' is within two points of time, ore at which the period begins and the other at which it expires. On the other hand, not less than 30 days' is outside these two points of time. There must be an interval of not less than 30 days and that means 30 days clear: See (1885) 29 Ch. D. 204 The period must continue beyond the expiration of the stated time. Whereas 'within' the stated period must mean what it says, something less than the moment of expiration.

Kania J. observed:

Reading the section by itself therefore it clearly means that period within which the assessee has to send his return must neither at the beginning nor at the end encroach upon the 30 days To put it in other words 30 clear days must elapse before his obligation to send the return becomes effective.

In (H.H.Raja) Harinder Singh v. S. Karnail Singh and Ors. : [1957]1SCR208 , the Supreme Court was considering the applicability of Section 10 of the General Clauses Act in relation to an election petition, which under Rule 119(a) was required to be filed 'not later than 14 days'. The contention before the Supreme Court was that Section 10 of the General Clauses Act can apply on its own terms only when the act in question is to be done 'within a prescribed period' and not to a case where the election petition was to be filed 'not later than fourteen days.' Their Lord ships observed,:

Broadly stated, the object of section is to enable a person to do what he could have done on a holiday, on the next working day. Where therefore, a period is prescribed for the performance of an act in a Court or office, and that period expires on a holiday, then according to the section the act should be considered to have been done within that period, ii it is done on the next day on which the Court or office is open.

2. For that section to apply, therefore all that is requisite is that there should be a period prescribed, and that period should expire on a holiday.

3. Now it cannot be denied that the period of fourteen days provided in Rule 119(a) for presentation of an election petition is a period prescribed, and that is its true character, whether the words used are 'within fourteen days' or 'not later, than fourteen days '

4. That the distinction sought to be made by the appelleant between these two expressions is without substance, will be clear beyond all doubt, when regard is had to Section 81 of the Act, Section 81(1) enacts that the election petition may be presented within suce time as may be prescribed and it is under this section that Rule 119 has been framed. It is obvious that the rule-making authority could not have intended to go further then what the section itself had enacted, and if the language of the Rule is construed in conjunction with and under coverage of the section under which it is framed, the words 'not later than fourteen days must be held to mean the same thing as within a period of fourteen days'.

The decision of the Supreme Court holding the expression 'nor later than fourteen days' as equivalent to within fourteen days' was arrived at on a reading of Rule 119(a) with Section 81 of the Representation of the People Act (1951) in connection with the applicability of Section 10 of the General Clauses Act, and having regard to these factors and the circumstances of the case, we have no hesitation in holding that the Supreme Court case AIR 1957 SC 271 affords no parallel to the kind of the case which was before the Bombay High Court or to that which is before us and we are unable to hold that the authority of the Bombay case AIR 1945 Bom. 316 is in any way shaken by the decision of the Supreme Court in Harinder Singh v. S. Karnil Singh : [1957]1SCR208 , or to agree with the observations in Suresh Chandra v. Birdhichand and ILR (1965) (15) Raj 793 that the observations of the Bombay case AIR 1945 Bom. 316 do not square with the observations of the Supreme Court in Harinder Singh v. S. Karnil Singh : [1957]1SCR208 . In our opinion, the view taken by the Bombay High Court in Commissioner of Incom-tax v. Ekbal and Co. AIR 1945 Bom. 316 was the correct one and that it does not in any way stand over-ruled by the Supreme Court decision. Thus, one of the arguments relied upon by the Bench. Suresh Chand v. Birdhichand ILR (1965) (15) Raj 793 must be treated as having no proper basis. The learned Judges, however, adopted some other line of reasoning in support of their conclusion, They quoted passages from Halsbury's Laws of England and Maxwell on Interpretation of Statutes and reached the following conclusions.

5. That there are two distinct categories of cases in the matter of calculation of the prescribed period of time. In one category fall the cases where an act has to be done on or after the expiration of a particular prescribed period and the other category comprises cases where a thing is permitted to be done within a stated period. It has been held that where an act could be done only after the expiry of a stated period both the terminal days of the period are to be excluded. But in the second category of cases, while the first terminal day excluded, the last day of the prescribed period is to be included and it is permissible to do the act only before the last day expires.

6. There can be no quarrel with the above categorisation of cases as also with the guiding principle as to the exclusion of one terminal day or both the terminal days. There is, however no justification for the conclusion that the general guiding principle as to the exclusion of both the terminal days in the first category and the exclusion of only one terminal day in the second category of cases, should be treated as an inflexible rule of a very rigid application irrespective of the language used in connection with the prescription of the period In this connection, we may refer to the following passage from Halsbury's Laws of England, page 95,:

EXPRESSIONS SHOWING INTENTION TO EXCLUDE: In many statues, statutory rules and bye-laws the intention to exclude both days and to give the person affected a clear interval of time between the two is put beyond all doubt by the insertion of words, such are 'clear days or not less than' so many days, or so many days, 'at least.

Similarly, there is a passage it Mraxwll on Interpretation of Statutes, p. 340 reading as follows,:

Again, when so many 'clear days' or so many days 'at least' are given to do an act, or 'hot less than: so many days are to intervene, both the terminal days are excluded from the computation In other cases, it would seem, the rule is to exclude the first and include the last day.

The use of the expression of the type referred to in these passages in any statutory rule or bye-laws, must warrant the exclusion of both the terminal days irrespective of the fact whether the case falls in one category or the other and there appears no good reason for interpreting such expressions as warranting exclusion of both the terminals in one category of cases and only of one in the second category of cases. It is true that para 167 of Halsbury's Laws of England is included in Section 2 begining at page 94 under the heading 'period of Expiration of which an act may be done' but the wider implication of the passage in para 167 cannot be curtailed on account of the heading. The pasage is based upon the language of decided cases. One of such cases Thompson v. Stimpson 1960 (3) All ER 500 was cited before us and it is a case clearly falling within the second category, of cases. On a proper consideration of the above two passages there is no escape from the conclusion that the use of expressions such as, 'clear days' or 'not less than ...days' or 'so many days at least' must warrant the exclusion of both the terminal days irrespective of the fact whether it is a case where an act has so be done on or after the expiration of a particular period or a case where thing is permitted to be done within a statutory period. In our opinion tee Bench deciding Suresh Chandra's case ILR (1965) (15) Raj 793 and Bhimkam Chand's case ILR (1965) 15 Raj 897 failed to give proper weight to these passages.

7. The above view finds full support from the decision in Rambharoselal Gahoi v. State of Madhya Pradesh and Ors. AIR 1955 Nag 35 In that case Sinha C. J, and Hidayatullah J., as they were then, laid down the law on the following weightly observations:

The rule of law is that whed words such as so many 'clear days' or to many 'at lest' are used, the two terminal days must be excluded. This rule is summarised by Maxwell on the Interpretion of Statutes, 10th Edn. at page 351, in these words:

(After quoting the passage which is similar to one quoted earlier teeir Lordships observed)

This statement is based on many cases cited by Maxwell, but the learned auther has not referred to Lord Tenterden's Test which was approved and applied by Lord Wensleydale (then Parke B) in Webb v. Fairmaner, (1838) 3M and W 49 at p. 540 ).

The test is laid down in-Pallow v. Wonford (1829)109 ER 50 (E) and is this: You reduce the period mentioned in the rule to one day. Then if the rule had said that an interval of atleast one day should pass and the notice was given on the 20th of May, the meeting could not be held except on the 22nd, for one day must pass. Adding nine more days to make up ten days, we reach the 31st of May, Fractions of days, are not counted.

8. The reason for that rule was stated by Sir William Grant in Lester v. Garland, (1808) 15 Ves. 243 at p. 257(F) as follows:

'Our law rejects fractions of a day more generally than the civil law does. The effect is to render the day a sort of indivisible point; so that any act, done in the compass of it, is no more referable to any one, than to any other portion of it; but the act and the day are co-extensive; and therefore the act cannot properly be said to be passed until the day is passed.'

As a result, it has been held in Sneath v. Valley Gold Ltd. (1893) 1 Ch. 477 (G); Zouch v. Empsey (1821) 106 ER 1028 (H); The King v. Justices of Herefordshire (1820) 106 ER 773 (1) and The King v. Turner (1910) 1 KB 346(J) (to cite only a few) that clear days must be counted between the two terminal ends, where the words are 'not less than', 'at least' or 'so many' clear days

A support for the above view is also derived from the following observations of the Supreme Court in Jai Charan Lal Anal v. The State of UP. and ors. : [1967]3SCR981 :

In our judgment, the expression 'not earlier than 30 days' is not to be equated to the expression 'not less than thirty days'. It is no-doubt true that where the expression is 'not less than so many days' both the terminal days have to be excluded and the number of days mentioned must be clear days but the force of the words 'not earlier than thirty days' is not the same.

Mr. Raj Narain, Additional Advocate General, contended that in Jai Charan Lal v. State of U.P. : [1967]3SCR981 the Supreme Court was merely interpreting the words 'not earlier than' and was not directly dealing with the expression 'not less than...days' and, therefore, the observations of the Supreme Court neither constitute a ratio or even an other dicta. According to him, the observations are merely casual. We are unable to treat the observations of the Supreme Court in the above noted case as casual. In any case, apart from the binding nature of these observations, the observations have our complete and respectful agreement.

9. Lastly, in Suresh Chandra's case ILR (1965) (15) Raj 793 the learned Judges also emphasised the fact that one month is certainly not less than one month and taking this fact along with the general guiding principle of excluding only one terminal day in the second category of cases, construed the expression 'within the period not less than one month' as equivalent to 'within one month'.

10. In the light of the proper approaches indicated in the Bombay and the Nagpur cases and the passages in Halsbury's Laws of England and Maxwell on Interpretation of Statutes, we ase unable to agree with the conclusion arrived at by the learned Judges. We must hold that the expression 'within a period of not less than 30 days' cannot be equated with the expression 'within one month' and that both the terminal days must be excluded to give clear thirty days time to the assessee.

11. The Additional Advocate General next contended that the provisions contained in Rule 54 read with Rule 34 of the Act should be construed as directory and not mandatory and that we should maintain the, assessment as there has been a substantial compliance of the provisions, According to him, at the best there was a shortage of one day in the period given to the assessee for filing the returns and that this could not have caused any prejudice to the assessee. He relied upon Chhatturam and Ors. v. Commissioner of Income-tax Bihar AIR 1947 FD 32, Maharaj Kumar Kamal Singh v. The Commissioner of Income-tax Bihar and Orissa AIR 1059 SC 257, and Pioneer Motors (Private) Ltd. v. Municipal Council, Nagercoil : [1961]3SCR609 .

12. On the other hand, it was contended on behalf of the petitioner that a valid notice under Section 64 lead with Section 34 of the Act is condition precedent for the initiation of the assessment proceedings that in the absence of such a notice there could be on valid foundation in the initiation of the proceedings. He relied upon Commissioner of Income Tax Bombay City v. Ramsukh Motilal : AIR1955Bom227 , and Jai Charan Lal Anal v. The State of U.P. and Ors. : [1967]3SCR981 .

13. We consider in proper to notice the leading and basic cases with a view to arrive at a proper conclusion.

14. In the Bombay case, Commissioner of Income-tax v. Ekbal and Co. AIR 1945 Bom. 316 the provisions of Section 22 of the Inccme-tax Act, which are similar to the provisions of Section 34 of the Act, appear to have been treated as mandatory provisiors. In that case the assessee was given a notice to file a return within a month. As there was a provision for a notice of not less than thirty days, the notice was considered bad. The assessce had made a return in compliance with that notice and it seems, he had not taken any objection before the Income-tax Officer to his being assessed. But the Court held that the notice being illegal, the fact that the assessee submitted a return later or that it was accepted for the purpose of making the assessment, did not cure the defect that initially lay in the notice. The decision clearly lays down two propositions of law that a defect in a notice under Section 22(2) made the notice illegal and that such illegality could not be waived. Thereafter, came the Federal Court decision in Chhaturam and Ors. v. Commissioner of Income Tax, Bihar AIR 1947 FD 32, In that case a certain notification was issued by Government of Bihar on 26th May, 1940 retrospectively applying the provisions of the Indian Income Tax Act to a certain division known as 'Chhotanagpur division' which was a partially excluded area and a notice had been issued under Section 22(2) prior to the date when this notification was to be issued. The assessment was challanged inter alia on the ground that notice was fad in as much as it was issued before the notification came into force and the assessee could not be assessed under the previsions of the notification. Kania J., as he was then, observed that the issue of receipt of a notice is not the foundation of the jurisdiction of the Income-tax Officer to make the assessment or of the liability of the assessce to pay the tax, and further held that the jurisdiction to assess and the liability of a citizen to pay tax are not conditional on the validity of the notice. He further observed that the assessment is merely procedural to determine the quantum of the tax and that the provisions with regard to notice are procedural provisions, and that the defects in the notice being a procedural defects, could always be waived by the assessee. This decision of the Fedral Court (8) certainly weakens the authority of the Bombay High Court treating the provisions of Section 22 of the Income-tax Act as mandatory. The case in point, however, is Commissioner of Income-tax Bombay City v. Ramsukh Motilal : AIR1955Bom227 . That was a case under Section 34 of the Income Tax Act read with Section 22. Section 34 of the Income-tax Act corresponds with Section 54 of the Act and Section 22 with Section 34 of the Act. Considering the provision of Section 34, Chagla C.J., speaking for the Court observed as follows,--

Now, there is a very important, and in our opinion, a fundamental distinction between a notice issued under Section 22(2) and a notice issued under Section 34. A notice under Section 22(2) is not obligatory and it is not a condition precedent to the assumption of jurisdiction by the Income-tax Officer. A public notice under Section 22(1) is obligatory and without issuing any notice under Section 22(2) if a return is made by an assessee pursuant to the public notice, the Income-tax Officer would have jurisdiction to assess. May, even if no public notice was issued and a voluntary return was made by an assessee, it cannot be disputed that the Income-tax Officer would have jurisdiction to assess. In that sense Section 34 is entirely different from Section 22(2).

As we have already pointed out, the very Scheme of that section is that the Income-tax Officer has no jurisdiction to assess under Section 34 without giving the notice referred to in that section. Therefore, whereas it will be perfectly true to say, as the Federal Court said that Section 22(2) is a procedural section and the failure to give notice or a defect in a notice is a procedural defect in the case of Section 34 it is not a procedural defect but it is a failure to comply with a condition precedent to the assumption of jurisdiction. It is true that the observations of the Federal Court, with respect, are rather wide and it may seem as if they apply to all notices under the Income-tax Act. But the decision is given in respect of Section 22(2) and again, with respect, the decision must be confined to the facts of that case.

This decision was approved by the Supreme Court in Y. Narayana Chetty and another v. The Income-tax Officer, Nellore and Ors. AIR 1959 SC 213. Gajendragadkar J. speaking on behalf of the Court stated the law in these them:

The notice prescribed by Section 34 cannot be regarded as a mere procedural requirement; it is only if the said notice is served on the assessee as required that the Income Tax Officer would be justified in taking proceedings against him. If no notice is issued or if the notice issued is shown to be invalid then the validity of the proceedings taken by the Income-tax Officer without a notice or in pursuance of an invalid notice would be illegal and void. That is the view taken by the Bombay and Calcutta High Courts in the Commn. of I. T. Bombay City v. Ramsukh Motilal, 1955(27) I. T. R. 54: (S) A I. R. 1955 Bombay 227 and R. K. Das and Co. v. Commissioner of I. T. West Bengal, 1958-30 I. T. R. 439: (A. I. R. 1956 Gal, 161) and we think that view is fight.

This authoritative pronouncement of the Supreme Court must govern the the persent case which is under Section 54 of the Act (corresponding to Section 30 of the Indian Income-tax Act) read with Section 34 of the Act (corresponding to Section 22 of the Indian Income-tax Act). The decision of the Federal Court in Chatturam and Ors. v. Commissioner of Income-tax, Bihar AIR 1947 FD 32 relied upon by Mr. Raj Narain, which is only restricted to Section 22 can have no bearing on the present case.

15. Mr. Raj Narain made an attempt to secure some support from Maharaj Kumar Kamal Singh v. The Commissioner of Income-tax, Bihar add Orissa AIR 1059 SC 257 and relied upon the observations appearing at page 260:

It is clear that two conditions must be satisfied before the Income Tax Officer can act under Section 34(1)(b). He must have information in his possession, which, in the context, means that the relevant information must have come into his possession subsequent to making of assessment order in question and this information must lead to his belief that income chargeable to income-tax has esceped assessment for one year, or at too low a rate or has been made the subject of excessive relief under the Act.

From these observations, it was argued that these are the two conditions necessary and that an omission to mention a condition of a valid notices in the passage should warrant an inference that valid notice is not a condition precedent for the exercise of jurisdiction by the Income-tax Officer. We are unable to accep this contantion. It appears to us that a reference to these conditions was made in the context of the controversy and that there was no occasion for Supreme Court to refer to the provision relating to notice. A positive statement about these conditions does not warrant a negative inference that the Supreme Court did not conider the issue of notice as a condition precedent to the exercise of jurisdiction. In this connection we cannot ignore the positive statement made in Y. Narryanna Chetty and another v. The Income-tax Officer, Nellore and Ors. AIR 1959 SC 213.

16. In Pioneer Motors Ltd. v. Nagercoil Mun. Council AIR 1967 SC 684 the Supreme Court was considering the proviso to Section 78 of the Travancore-Cochin District Municipalities Act requirring that before passing a resolution imposing a tax the Council shall publish a notice in the Gazette of the intention to fix a reasonable period of not less than one month for the submission of the objection. Having regard to the use of the word 'reasonable', the Court considered the provision as to the period of notice as directory. The Additional Advocate General contends that even (hough the word 'reasonable' has not been used in Section 34 of the Act, the principle of the case should apply to the facts of the present case. We must point out that in this case the learned Judges referred to the decision of the Bombay High Court in Commissioner of Income-tax v. Ekbal and Co. AIR 1945 Bom. 316 where a notice was held to be without jurisdiction, but avoided the applicababity of the principle of that case to the case before them on the ground that notice was the basis of the jurisdiction to tax and that the legal notice was an obligation imposed in order to tax an individual and that it was a mandatory provision. It may be mentioned that the ground on which the case Commissioner of Income-tax v. Ekbal and Co. AIR 1945 Bom. 316 was distinguished by the Supreme Court must apply with greater force to the case of a notice under Section 54 and the learned Additional Advocate General cannot derive any assistance from this decision, particularly having regard to the clear observations in Narayan Chetty v. I.T. Officer AIR 1959 SC 213.

17. On a review of the cases and having regard to the authoritative pronouncement of the Supreme Court in Y. Narayan Chetty and another v. The Income-tax Officer, Nellore and Ors. AIR 1959 SC 213, we are unable to hold that the provisions of Section 54 of the Act are of directory nature and must hold that issue of alid notice under Section 54 of the Act read with Section 24 was a condition precedent for laying the foundation for the initiation of proceedings. The contention of Mr. Raj Narain therefore cannot be accepted.

18. In the light of the above discussion we hold that the notice given by the Agricultural Income-tax Officer requiring petitioner to submit reason within 30 days was not in conformity with the provisions of Section 34 of the Act and was bad in law and that there was no foundation for the initiation of the assessment proceedings by the Agricultural Income-tax Officer, and that the proceedings relating to assessment and the assessment orders are without jurisdiction and unsustainable.

19. The writ application is, therefore, allowed and the proceedings relating to assessment and the assessment orders are quashed. There will be no order as to costs.


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