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Issues Involved:
1. Applicability of the principles of [1980] KLT 276. 2. Exercise of powers u/s 34 after an inordinate delay. 3. Applicability of the decision in Bhavani Tea and Produce Co. v. Commr. of Agrl. I.T. [1972] Tax LR 2413. 4. Reasonableness and rationality of the revisional order passed by the Commissioner. Summary: Issue 1: Applicability of the principles of [1980] KLT 276 The court examined whether the principles of [1980] KLT 276 (Commissioner of Agrl. I.T. v. Chullikkan Parameswara Bhat [1980] 125 ITR 28 (Ker)) were applicable to the instant case. The Commissioner of Agricultural Income-tax held that these principles were not applicable, and the court did not find it necessary to address this issue further due to the resolution of the other issues. Issue 2: Exercise of powers u/s 34 after an inordinate delay The main argument by the assessee was that the Commissioner exercised the revisional power u/s 34 after an inordinate delay of nearly 20 years from the assessment order and 13 years from the initiation of proceedings. The court found that the revisional order passed by the Commissioner on October 31, 1980, was unreasonable and irrational due to the inordinate delay. The court emphasized that statutory powers must be exercised within a reasonable period, citing several Supreme Court decisions and previous judgments of the Kerala High Court. Issue 3: Applicability of the decision in Bhavani Tea and Produce Co. v. Commr. of Agrl. I.T. [1972] Tax LR 2413 The court considered whether the decision in Bhavani Tea and Produce Co. v. Commr. of Agrl. I.T. [1972] Tax LR 2413 was applicable to the present case. The court noted that the Commissioner of Agricultural Income-tax should exercise his suo motu power of revision within a reasonable time, as established in previous cases. However, due to the resolution of the primary issue regarding the delay, the court did not find it necessary to address this issue further. Issue 4: Reasonableness and rationality of the revisional order passed by the Commissioner The court held that the revisional order passed by the Commissioner on October 31, 1980, was unreasonable and irrational due to the inordinate delay. The court emphasized that statutory powers must be exercised bona fide, reasonably, and without negligence. The court rejected the Revenue's argument that the final order could be passed at any time after the initiation of proceedings, stating that both the initiation and completion of proceedings must occur within a reasonable time. Conclusion: The court answered question No. 1 in I.T.R. No. 585 of 1985 in the negative, against the Revenue and in favor of the assessee. The court declined to answer the other three questions in the two cases, as the primary issue regarding the delay rendered them unnecessary. The reference was disposed of accordingly, and a copy of the judgment was ordered to be forwarded to the Commissioner of Agricultural Income-tax, Trivandrum.
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