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TMI Blog1942 (9) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... some income for which they were liable as such agents had escaped assessment. The assessment order on that supplementary assessment was made on the 3rd of January 1940 under Section 23(4), that is to say it was a best judgement assessment. The first question raised is:- Whether the notice issued under Sections 34 and 22(2) on the 19th March 1937 ceased to be valid and effective in law by reason of the abolition of the Special Circle and the transfer of the assessees' case to the Income-tax Officer, Section I (Central)." It is admitted that, having regard to previous decisions See Dayaldas Khushiram v. Commr. of Income-tax, Central (Bom.) (1943) 11 I.T.R. 67 of this Court, that question must, so far as this Court is concerned, be answered in the negative. The second question is: "Whether the notice under Section 22(4) dated 8th August 1939 not having been issued by the Income-tax Officer of the area in which the assessees' place of business was situate, the said notice and the proceedings based on it are valid in law." There, again, it is admitted that, having regard to previous decisions See Dayaldas Khushiram v. Commr. of Income-tax, Central (Bom.) ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nued to draw the pay of an Assistant Income-tax Officer. It is noticeable that he signed the assessment order of the 3rd January 1940, and the order under Section 27 to which I will refer presently, of the 2nd February 1940, as Assistant Income-tax Officer. Merely appointing a man to perform the duties of an office does not amount to a substantive appointment to that office. I apprehend that appointing a District Judge to officiate as a High Court Judge, and to hold office in the place of a High Court Judge proceeding on leave would not by itself constitute the District Judge a High Court Judge, particularly if he continues to draw only the salary of a District Judge. He must be appointed a High Court Judge. Although I have no doubt that an Income-tax Officer can be appointed to act in a temporary vacancy, in my opinion, it is not permissible to appoint somebody, who is not an Income-tax Officer so to act. If the contention of the Commissioner is right, he would be justified in appointing a junior clerk in his office or even the office peon on ₹ 25 per month to perform the functions of an Income-tax Officer. Income-tax Officers have to perform very responsible duties, and I t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agent for one year will hold good for subsequent years. In order to justify the appointment of an agent under Section 43 the Commissioner has to be satisfied on certain questions of fact, and the assessee has a right to dispute his liability to be deemed the agent. It is obvious, that although an agent may fail in a particular year to resist the claim that he is an agent, circumstances may alter, and in the next year he might be able to resist the claim. However, in this particular case the agents did not dispute their liability to be assessed in respect of the year 1935-36. They were actually assessed, and they paid the tax and it seems to me that that amounts to an admission on their part that in respect of the year 1935-36 they were the agents of the principal for the purposes of Section 43. The re-assessment under Section 34 is a part of the assessment for the year 1935-36, and although the actual re- assessment was not made until the beginning of 1940, the facts necessary to constitute them agents for the re-assessment were the same, and have to be determined for the same date as in the case of the original assessment. I think that in the face of their conduct it is not open ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment, but the books could, of course, have been used in relation to their assessment as agents. On the 15th of December 1939 this Court held Dayaldas Kushiram v. Commissioner of Income-tax (Central), (1940) 8 I.T.R. 139 in the case of another assessee in exactly the same position as the present assessees, that the contention as to jurisdiction was well founded, and that the assessee in question was not liable to be assessed by an Income-tax Officer, Central. The result was that on that date it was established that the Income-tax Officer, Central, had no business to serve the order which he had served requiring the assessees to produce their books. On the 30th of December the Governor General promulgated an Ordinance, the effect of which in substance was to overrule the decision of this Court, and the Ordinance was made retrospective. So that, on the 30th of December,for the first time,the order of the 8th of August requiring production of books became valid. Now, it seems to me obvious that the assessees ought to have been given reasonable time in which to produce their books. Up to the 30th of December they were entitled to refuse to produce their books to an officer who had no ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter of procedure, and that in the absence of clear language the statute should be construed as not applying to appeals in suits pending when the statute was passed. The Privy Council held that a man filing a suit is entitled to say:- "I have a right to carry my grievance to the highest tribunal," but that is a substantive right, not lightly to be taken away, and they held that it was not taken away by the statute in that case. In Delhi Cloth and General Mills Co. v. Commissioner of Income- tax, Delhi [1927] L.R. 54 I. A. 421, the Privy Council applied the same principle to a statute granting a right of appeal. They held that a statute granting a right of appeal also dealt with rights, and not procedure, because it put an end to the finality of certain orders, but the Privy Council were then dealing with an order actually been made before the right of appeal was given, and they held that in the absence of clear words the statute should not be construed as giving a right of appeal against a subsisting order. In Sakeena Bibi and Others v. C. Stephens [1926] I.L.R. 4 Rang. 221, the principle of that case was applied to a suit pending when the statute was passed, in whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m in the matter of the assessees. Both those orders were made and signed by him as "Assistant Income-tax Officer." It is, therefore, clear that although he may be clothed with authority to perform the functions of an Income-tax Officer, in fact in making the orders he did not act as an Income-tax Officer, and the orders in fact made by him, as stated in the orders themselves, were as Assistant Income-tax Officer. It is open to argument that that description was a mistake, but there is no material to show that it was a mistake at all. The notification in the Government Gazette, the terms whereof have been quoted in the judgement of the learned Chief Justice, does not carry the case further. That notification describes Mr. Gondalia as Assistant Income-tax Officer and posts him to Section I (Central), which only means that he will hold charge of that section. But those words do not make him an Income- tax Officer for that section. The further words "vice Mr. H.P. Parekh" also, in my opinion, do not take the matter further. It only shows that Mr. Gondalia by virtue of that notification was as if authorised to sit in the chair occupied by Mr. Parekh. In law, as the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition of the notice, and the conduct of Mr. Gondalia in making the order of the 3rd January 1940 was arbitrary and capricious. As regards question (6), the three cases cited by Mr. Setalvad, in my opinion, do not support his contention. It is necessary to turn to the words of Section 30 before the Amendment: Act of 1939. That section gave a right of appeal to the assessee on the points mentioned thereon. Then there is a proviso, which says that no appeal shall lie in respect of an assessment made under sub-section (4) of Section 23, or under that sub-section read with Section 27. The effect of the amendment in 1939 was inter alia to remove this proviso. The question, therefore, is whether in respect of the assessment proceedings, which were pending on the 1st of April 1939, this proviso barred a right of appeal given by the amending Act of 1933. In this connection the words of the proviso, in my opinion, are very clear. They only debar an appeal in respect of an assessment made under that section when that Act was in operation. It does not deal with assessment proceedings pending at the time. Therefore, unless on the date of the Amending Act an assessment order had been made, and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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