1958 (11) TMI 24 - SC - Income Tax

Whether in this case there was inordinate delay in the matter of the presentation of this petition to the court? Whether the relief sought by the petitioner is in respect of three orders and notices of the Income-tax Officer who is respondent No. 2 as well as the order passed in revision by the third respondent who is the Commissioner of Income-tax and it is said that there is no ground mentioned in the petition for any writ being issued in respect of the order passed by the third respondent in revision? Held that - There can be no rule which may be adhered to in every case because the very conception of discretion rules out the existence of any rigid formula. In the present case we do not think we would be justified in rejecting the petition on the ground that there has been inordinate delay in the filing of the petition. There were clear and tenable reasons for the distinction to be drawn between an appeal and a revisional application when the revisional application was dismissed. There was an appeal against that judgment and the appeal court confirmed that decision. It was held by the appeal court that when the revisional court interferes with the order of the court below the result is not that the order of the lower court is merged in the order passed by the revisional court but the result is that the order of the revisional court sets aside or modifies the of the lower court. Whereas in the case of an appeal when the appeal is dismissed the appellate court confirms the decree of the trial court in the case of a revisional court when it dismisses the petition in revision all that it does is that it does not interfere with the order of the court below. The effect of the dismissal of the petition is not to confirm the order of the trial court because no confirmation is necessary from the revisional court. When the revisional court dismisses the petition the true effect in law is that it refuses to exercise the revisional jurisdiction conferred upon it. The penal interest that can be charged to any assessee under sub-section (6) can only be in respect of an assessee who has paid tax under sub-section (2) or sub-section (3) on the basis of his own estimate and the assessee in the case before us could not have been charged with any penal interest under sub-section (6). If she could not have been charged any penal interest under sub-section (6) says Mr. Joshi there could be no question of invoking the fifth proviso to that sub-section. In our judgment there is considerable force in this argument of learned counsel for the Revenue. Appeal allowed.

Issues Involved:
1. Interpretation of income-tax law provisions.
2. Delay in filing the petition.
3. Grounds for issuing a writ against the Commissioner's order.
4. Applicability of Section 18A(6) versus Section 18A(8) regarding penal interest.
5. Discretion of the Income-tax Officer to waive penal interest under Section 18A(6).

Detailed Analysis:

1. Interpretation of Income-Tax Law Provisions:
The court emphasized the importance of interpreting income-tax law provisions harmoniously. It stated, "the court must look merely at the express language of the law-maker if it is clear or the necessary intendment to be gathered from such express language of the enactment." The court ruled that the construction of any provision of a taxing statute cannot be controlled by the consequences that may follow where the language is clear and capable of only one meaning.

2. Delay in Filing the Petition:
The petition was filed on 26th June, 1958, after the order of the Commissioner dismissing the revision application on 3rd January, 1958. The court acknowledged a delay of five months between the Commissioner's order and the filing of the petition. However, it noted that the delay was partly due to the petitioner studying the judgment in Shantilal Rawji's case. The court held that "writ petitions are not for those who slumber and sleep over their rights," but in this case, the delay was not deemed inordinate or inexcusable.

3. Grounds for Issuing a Writ Against the Commissioner's Order:
The court found no ground mentioned in the petition for issuing a writ in respect of the order passed by the Commissioner in revision. It stated that the petitioner could challenge the validity of the three orders and notices of demand issued by the Income-tax Officer without necessarily seeking relief against the Commissioner's order. The court clarified that "the order of the Commissioner does not affect the relief which she would get if she was ultimately entitled to the same from this court."

4. Applicability of Section 18A(6) Versus Section 18A(8) Regarding Penal Interest:
The court distinguished between Section 18A(6) and Section 18A(8). It noted that Section 18A(6) applies to cases where the assessee has paid tax under sub-section (2) or (3) on the basis of their own estimate. In contrast, Section 18A(8) applies where no payment of tax has been made in accordance with the provisions of the section. The court stated, "the language of sub-section (8) is mandatory and there is no proviso tacked on to sub-section (8) of the nature of the proviso engrafted on sub-section (6)." Therefore, the court held that the case of the assessee did not fall within the ambit of Section 18A(6) but rather within Section 18A(8).

5. Discretion of the Income-Tax Officer to Waive Penal Interest Under Section 18A(6):
The court rejected the argument that the discretion to waive penal interest under the fifth proviso to Section 18A(6) should be read into Section 18A(8). It stated, "if it was the intention of the Legislature to rule that the fifth proviso to sub-section (6) which vested certain discretion in the Income-tax Officer to reduce or waive the interest payable by the assessee as penal interest, there was nothing to prevent it from adding a proviso to sub-section (8)." The court concluded that the provisions of Section 18A(8) are mandatory and do not incorporate the discretion provided in Section 18A(6).

Conclusion:
The petition was dismissed. The court held that the provisions of Section 18A(8) are mandatory and do not incorporate the discretion to waive penal interest provided in Section 18A(6). The court also noted that there was no ground for issuing a writ against the Commissioner's order and that the delay in filing the petition was not inordinate. The petitioner was ordered to pay half the costs of the respondents.

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