1. These petitions arise out of two suits by the plaintiff-petitioner to recover from the defendant, the Taluk Board of Nannilam represented by its President, two sums which he alleges are the amount of profession tax illegally levied on him for the years 1923-24 and 1925-26, and which he has been compelled to pay by legal process. His grievance is that he has been assessed for the first of these years on a Class I income and for the second year on a Class II income, whereas he claims that the correct basis of assessment was his income-tax returns for these years which would have brought him within a lower class of income and made him liable to a lower rate of profession tax.
2. The substantial defence raised to the petitioner's claim is Section 228 of the Madras Local Boards Act. This provides,
Sub-section (1) - No assessment or demand made, and no charge imposed, under the authority of this Act shall be impeached or affected by reason of any clerical error or by reason of any mistake (a) in respect of the name, residence, place of business or occupation of any person, or (b) in the description of any property or thing, or (c) in respect of the amount assessed, demanded or charged : provided that the provisions of this Act have been, in substance and effect, complied with
Sub-section (2). - No suit shall be brought in any Court to recover any sum of money collected under the authority of this Act or to recover damages on account of any assessment or collection of money made under the said authority: provided that the provisions of this Act have been in substance and effect complied with.
3. The question to be determined is, therefore, has the assessment for profession tax been made upon the petitioner in substantial compliance with the provisions of the Act. By Rule 9, Schedule IV of the Act the President of a Local Board is entrusted with the duty of classifying persons assessable to profession tax according to the amount of their income. The rule fixes classes according to the scales of income and the maximum rate of tax leviable in respect of each class. Thus, at the top of the list stands Class 1 which includes incomes not less than Rs. 2,000 per mensem subject to a maximum half yearly tax of Rs. 110, and at the bottom is Class X comprising incomes between Rs. 50 and Rs. 25 per mensem subject to a maximum half-yearly tax of eight annas. Rule 11 indicates the methods of making the classification. It says:
The President may classify all persons liable under Rule 9 on general considerations with reference to the nature and reputed value of their business, the size and rental of residential and business premises, the quantity of articles dealt with, the number of persons employed and the income-tax paid to Government.
4. It further provides:
The President shall not call for the accounts of any assessee, but any person may produce his accounts to show that the income derived by him from the exercise of his profession falls below the lowest income entered at the head of the class in which the President has placed him and the President shall revise the assessment if satisfied that the person should be placed in a different class.
5. If the President is not satisfied that a revision should be made the assessee is given by Rule 27 the right to appeal to the Local Board.
6. The petitioner's case, as appears from para. 6 of his plaint, is that the proper basis of assessment for profession tax is the amount in respect of which he has been assessed for income-tax. It is alleged in the plaint that 'it is distinctly provided in the Local Boards Act that the basis for assessment of profession tax must be the income-tax amount to be paid by the assessee' and it is further alleged that the assessment having been made 'without any regard to the said basis is contrary to the provisions of the Madras Local Boards Act, and also contrary to the admissions distinctly made by the defendant in many proceedings'. Apparently it is the fact that for the intervening years 1924-25, the petitioner was assessed for profession tax upon the income-tax basis. Income-tax assessment is one of the matters which the President may take into consideration, but he is not bound by the Act to accept it as the only basis of assessment for profession tax. The learned advocate for the petitioner has, however, contended that there was no other basis on which his client could have been assessed. I think there is evidence that this is not the case. The President is entitled by Rule 11 to take into consideration a variety of matters as a guide, to an assessee's professional income, including the reputed value of his business. The petitioner was carrying on the business of a moneylender. For the year 1923-24, the President received Ex. I, a report by the Village Officer, stating that the petitioner's income from the business was Rs. 1,500 per mensem. The President was entitled to take that report into consideration and to act upon it if he thought proper. It is true that the Village Officer's report recommended that the petitioner should be assessed on the income-tax basis. But the President was free to ignore the recommendation if he considered that the reputed value of his money-lending business was the proper basis of assessment. For the year 1925-26 the President received a report from the Village Officer stating that the petitioner's income from his business was Rs. 150 per mensem. The President suspected the truthfulness of this report and referred the matter to the Village Panchayat. The Panchayatdars reported that the Village Officer's report was untrustworthy and unanimously adopted a report made by the Panchayat President upon the professional income of the Petitioner. The resolution [Ex. V (a)] of the Panchayat has been exhibited, but not the report. But it may, I think, be reasonably inferred that the President of the Local Board was guided by this report of the Panchayat in making the assessment. I do not agree with the view of the Subordinate Judge that the President is privileged from divulging the grounds on which he made the assessment. If the defence of Section 228, is relied upon it must appear from evidence that the assessment has been made upon grounds which the President is entitled to take into consideration in making the assessment. In my judgment it has been sufficiently shown that the assessments were made in substantial compliance with the provisions of the Act, and that the petitioner's suit was rightly dismissed. The Revision Petitions must accordingly be dismissed with costs, one set.