9911796707
TMI Blog1969 (3) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent, the order, dated the 28th February, 1963, of the Deputy Commissioner, Ranchi (who is not a party respondent to the application), the order, dated the 3rd March, 1966, made by the fourth respondent and the resolution, dated the 20th February, 1967, passed by the fifth respondent and further to show cause why the said respondent be not restrained from realising the amount in question from the petitioner. Respondent No. 1 has shown cause by filing a counter-affidavit and Mr. Ugra Singh has appeared on behalf of the income-tax department to oppose the making of the rule absolute. Mr. Tarkeshwar Prasad has appeared in support of the rule. The petitioner's case, as stated in the writ application, is that, for the assessment year 1945-46, he was assessed to income-tax and demand notice was issued on the 25th March, 1946. Eventually, the Income-tax Appellate Tribunal passed an order in his appeal, arising out of the said assessment proceeding, on the 6th April, 1953, and the order of the Tribunal was received by the petitioner on the 3rd June, 1953. On the 20th March, 1955, ("20-3-53" mentioned in paragraph 4 is admittedly a mistake), a certificate proceeding was started at Calcutt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en issued on the 25th March, 1946, and another sum of Rs. 1,90,736-12-0 assessed upon the petitioner under section 34 of the Act. The Income-tax Officer, Ranchi, sent a requisition to the Certificate Officer, Ranchi, on the 25th March, 1957, and the latter signed the certificate and started certificate Case No. 42 of 1956-57. Later on, by an order dated the 8th May, 1957, passed by the Commissioner of Income-tax, Patna, the income-tax file of the petitioner was transferred to the Income-tax Officer, Hazaribagh. The said officer directed amendment of the certificate by reducing the recoverable amount in respect of the years 1948-49 to 1950-51, but leaving the certificate proceeding to go on for realization of the two amounts of 1945-46 and the tax demand for the assessment year 1951-52. The petitioner filed his objection under section 9 of the Bihar and Orissa Public Demands Recovery Act, 1914 (B. & O. Act 4 of 1914) before the Certificate Officer, Ranchi, denying his liability on several grounds, only two out of which have been pressed in this court, which will be stated hereinafter. The Certificate Officer rejected the objections of the petitioner by his order dated the 5th Decemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f this court dated 30th August, 1962, being Civil Appeals Nos. 488 to 490 of 1967 resulted in passing of a consent order on the 10th October, 1963, in the Supreme Court, a plain copy of which order was produced by learned advocate for the petitioner during the hearing of this writ application. He has also relied upon certain facts mentioned in the judgment of the High Court in the case referred to above. Strictly speaking, the petitioner was not justified in referring to the facts from the decision of the Patna High Court and the consent order made by the Supreme Court in relation thereto, as no reference to them was made by him in his writ application or the affidavit-in-reply, nor does it appear from the order of the Commissioner or the Board that these decisions were referred to before them. Be that as it may, ignoring the technicalities, we have thought it advisable to refer to some facts from the decision of this court as also from the consent order at the persuasion of the petitioner's counsel. In the counter-affidavit of respondent No. 1, it is stated that the fresh computation was made by the Income-tax Officer, Central Circle II, Calcutta, on the basis of the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oard of Revenue, however, transferred the income-tax file of the petitioner from Ranchi to Calcutta by its order dated the 18th August, 1952, whcih was challenged before the Supreme Court, as stated above, and was set aside by it on the 20th March, 1956. Notices under section 22(2) of the Act had been issued by the Income-tax Officer, Special Circle, Patna, asking the petitioner to file his returns for the assessment years 1948-49 to 1950-51. He had filed the returns also before him. Further steps were taken and were being taken by the Income-tax Officer, Special Circle, Ranchi, and thereafter by the Income-tax Officer, Central Circle II, Calcutta. After the decision of the Supreme Court dated 20th March, 1956, however, and on transfer of the petitioner's file to the Income-tax Officer, Special Circle, Ranchi, the said officer proceeded to assess the petitioner in respect of the three years aforesaid by issuing notices under section 34 of the Act. When his file was again transferred to the Income-tax Officer, Hazaribagh, on the 8th May, 1957, by an order of the Commissioner of Income-tax to be effective from the 15th May, 1957, the Income-tax Officer, Hazaribagh, proceeded to take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Board's order was, however, not filed with the writ application, and it is not known as to what were the terms of the Board's order dated the 21st March, 1956. The matter is crystal clear, on the facts as they emerge on the basis of the petitions and the affidavits, that at the time the petitioner's file was transferred to Calcutta by the Central Board of Revenue, it was pending before the Income-tax Officer, Special Circle, Ranchi. The order of the Board was set aside by the Supreme Court. The usual and the natural consequence of it was that the file had to be sent back to the Income-tax Officer, Special Circle, Ranchi, as the order of the Income-tax Officer, dated the 21st April, 1951, transferring the petitioner's file to Ranchi was never challenged before the Supreme Court, when the order of the Central Board of Revenue transferring his file from Ranchi to Calcutta was challenged. In my opinion, therefore, the Commissioner of Income-tax committed no mistake or error when, as a result of the Supreme Court decision and being directed by the Central Board of Revenue, even assuming, as is the case of the petitioner, to transfer his income-tax file to the territorial Income-t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out from the consent order dated the 10th October, 1963. Shorn of complications of the other points involved in relation to the assessment proceedings for the three years, or the infirmities therein, if any, suffice it to say, for the disposal of the present application, that the order of the Commissioner of Income-tax passed on the 21st April, 1951, under section 5(5) of the Act, was very much different in character and was passed in exercise of a wider and more general power of transfer conferred upon the Commissioner, than conferred either upon him or upon the Central Board of Revenue under section 5(7A) of the Act, the order dated the 18th August, 1952, passed under which provision of law by the Central Board of Revenue was successfully challenged by the petitioner before the Supreme Court. Under section 5(5) of the Act, the Commissioner had very wide powers to transfer the income-tax file of the petitioner. As a matter of fact, as it appears from the judgment of this court in Raja Bahadur Kamakhya Narain Singh v. Union of India not only the file of the petitioner, but by a general order, income-tax files of many such assessees were transferred from Patna, Special Circle, to Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the certificate case had been started at Ranchi. In support of this contention, reliance was placed upon a decision of a learned single judge of the Kerala High Court in T. R. Subramania Iyer v. lncome-tax Officer. The facts of that case are substantially different. There, the Income-tax Officer of New Delhi, who had made the assessment upon the basis of which the arrears of tax were due, had requested another Income-tax Officer in the State of Travancore to forward the certificate to the Collector for realisation of the arrears. It was pointed out that the procedure to be followed in such a case was indicated in sections 3 and 5 of the Revenue Recovery Act, under which Act the proceedings were taken in that case. A corresponding provision in the Bihar and Orissa Public Demands Recovery Act to the one under section 3 of the Revenue Recovery Act is to be found in section 13. Section 5 of the Bihar and Orissa Act, however, does not incorporate the condition mentioned in section 5 of the Revenue Recovery Act, namely, that where any sum is recoverable as an arrear of land revenue by any public officer other than a Collector, the Collector of the district in which the office of that off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vided further that nothing in the foregoing proviso shall have the effect of reducing the period within which proceedings for recovery can be commenced, namely, after the expiration of one year from the last day of the financial year in which the demand is made. Explanation.-A proceeding for the recovery of any sum shall be deemed to have commenced within the meaning of this section, if some action is taken to recover the whole or any part of the sum within the period hereinbefore referred to, and for the removal of doubts it is hereby declared that the several modes of recovery specified in this section are neither mutually exclusive, nor affect in any way any other law for the time being in force relating to the recovery of debts due to Government, and it shall be lawful for the Income-tax Officer, if for any special reasons to be recorded he so thinks fit, to have recourse to any such mode of recovery notwithstanding that the tax due is being recovered from an assessee by any other mode." It is undisputed in this case that a fresh demand, in pursuance of the appellate order of the Tribunal was made by the Income-tax Officer from the petitioner and it was served on him on the 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes or of invalidating all orders passed by the Income-tax Officer, Calcutta, or any action taken by him during the pendency of the income-tax file of the petitioner before him. This is quite a reasonable view to take, otherwise, by just giving an example, I will illustrate the disastrous result which may follow to the Central revenue. Supposing by an order made under section 5 of the Act, a case or a particular class of cases is transferred from the file of one Income-tax Officer to another. The order of transfer is challenged by a particular assessee. The proceeding in which the order is challenged remains pending, say, for a period of five years or more. Until the order of transfer is successfully challenged, it cannot be assumed that the Income-tax Officer, who is in seisin of the file in pursuance of the order of transfer, is to sit idle and take no action in regard to the file of a particular assessee. He takes action, finding that, unless he takes action, the realisation or recovery of the tax will be barred under section 46(7) of the Act. The order of transfer of the file to him is eventually set aside. If a view were to be taken that the action taken by him will be in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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