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TMI Blog1971 (8) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... recovery of Rs. 3,500 as damages. The plaintiff's case is that he and his brother, Chenraya, as members of a joint Hindu family, owned 12 acres of land and a terraced house, and were cultivating 14 acres of land on lease for five years before the suit, their lessors being Ramachandran and Krishnan, sons of Gengu Reddy. The Tahsildar of Tiruppathur caused No. 1 demand notice issued to the village munsif of Kurizalapattu to realise the income-tax arrears to the extent of Rs. 2,449.09 due to Government by Gengu Reddy. Gengu Reddy died in or about 1961, leaving behind his aforesaid sons as heirs. A notice was issued to the legal heirs for payment of the said arrears of their father. In spite of their contention that there was a partition in their family in 1950 and that they were not liable for any such arrears, the sugarcane crops raised by the plaintiff as lessee of Ramachandran and Krishnan on land belonging to Gengu Reddy were attached for recovery of the income-tax arrears. The plaintiff (lessee) filed an objection petition before the Tahsildar, Tiruppathur, stating that he was a lessee from Ramachandran and Krishnan (sons of Gengu Reddy), that the crops raised by him could not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ps standing, in S.F. No. 386/1, 385/2, 387 and 388/1 belonging to the defaulter and leased to plaintiff. The attachment was duly effected. As the village headman believed that the plaintiff illegally removed, harvested and crushed the sugarcane crops under attachment, he gave a complaint on March 3, 1962, to the sub-inspector of police and reported the matter to the Tahsildar. The police filed a charge-sheet against the plaintiff under section 379, Indian Penal Code, and the plaintiff was convicted for the offence by the trial Magistrate. The plaintiff and his brother, Chenraya, preferred a claim petition dated February 3, 1962, before the Sub-Collector, Tirupattur, for cancellation of the said attachment. The Sub-Collector dismissed the petition on July 19, 1962. The attachment thus duly effected was valid and binding on the plaintiff and on the heirs of Gengu Reddy. The defendant was not aware of the alleged, partition between Gengu Reddy and his sons. Even if such a partition had existed, it was created only nominally and collusively to defeat the claim of the income-tax department. The said lands belonged to the defaulting assessee on the date of the attachment. The heirs of Ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge further found that the plaintiff has not proved that the revenue authorities had acted with malice or that the plaintiff was prosecuted without reasonable and probable cause and with malice. In the result, the appeal was dismissed. The plaintiff has filed the above Second Appeal. Shri T. S. Subramaniam, the learned counsel for the appellant, raised before us the following contentions : (1) The suit against the Government for recovery of damages for malicious prosecution and for recovery of the value of the crop alleged to be stolen is maintainable : (2) The suit is not barred under section 59 of the Madras Revenue Recovery Act ; and (3) The certificate of the Collector (exhibit B-6) showing Gengu Reddy, who is dead, as the defaulter, does not entitle the Collector to proceed against the legal representatives of Gengu Reddy or the lessee from such legal representatives without the certificate being amended by the income-tax department. (4) The plaintiff is entitled to damages claimed. We shall now take up the first question. In order to appreciate the contention raised we have to recapitulate the English law on the matter and the background under which the constitutional p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Secretary of State in Council as a body corporate ; and all persons and bodies politic shall and may have and take the same suits, remedies and proceedings, legal and equitable, against the Secretary of State in Council of India as they could have done against the said company ; ...... Section 32(2) of the Government of India Act, 1915, clarified the above phraseology as follows : "Every person shall have the same remedies against the Secretary of State in Council as he might have had against the East India Company if the Government of India Act, 1858, and this Act had not been passed." The Government of India Act of 1935 in section 176(1) also reproduces the same provision with two modifications : (a) in respect of the Secretary of State, Federation of India and the provincial governments were made liable to be sued in like cases and the Secretary of State in Council might be sued under the provisions of the Acts ; (b) the liability of the Government is, therefore, subject to, any provision of any Act that liability based upon the federal legislature or the provincial legislature as the case, may be. Article 300(1) of the Constitution section 176(1) of, the 1935 Act are mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g with this question is the leading case, of Peninsular and Oriental Steam Navigation Company v. Secretary of Stak. The above case was under a reference made by the Chief judge of the Court of Small Causes, Calcutta, to the Supreme Court at Calcutta under section 55 of Act IX of 1850. We have thought it necessary to refer to the above decision at some length as this decision deals with two aspects, first of which is covered by the head-note and the second of which was not necessary to answer the question referred to them. The suit was to recover damages of Rs. 350 on account of the injury caused to the plaintiff's horse through the negligence of certain servants of the Government. The learned Chief Justice considered that though the reference to them was not specific, yet the question referred was "whether the Secretary of State was liable for the damages occasioned by the negligence of the servants in the service of the Government assuming them to have been guilty of such negligence as would have rendered an ordinary employer liable." The learned Advocate-General who appeared for the Government acquiesced in the above view and the case was argued on that basis. The learned Chief J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e individuals, There is a great and clear distinction between acts done in the exercise of what are actually termed 'sovereign powers' and acts done in the conduct of undertakings which might be carried on by private individuals without having such powers delegated to them." The learned Chief Justice, referred to Moodaley v. East India Company and Same v. Morton relating to a lease for 10 years entered into by an individual authorised by the East India Company and dispossessed by the East India Company before the expiry of the term for no fault of the lessee and another person was inducted as the lessee and the East India Company pleaded that the removal of the old lessee and substitution of another lessee is an incident to the character as a sovereign power. The Master of the Rolls (Lord Kenyon) said : "I admit that no suit will lie in this court against a sovereign power for anything done in that capacity, but I do not think the East India Company is within the rule. They have rights as a sovereign power ; they have also duties and obligations as individuals." The learned Chief Justice referred to a number of decisions all of which dealt with acts of State, for example (Politi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company, and in coming to the aforesaid conclusion, the Lord Chancellor placed considerable reliance upon the decision in P. & O case. In P. V. Rao v. Khusaldas, dealing with the power of acquisition by the Government, the learned Chief Justice referred to the P. & O. case and the observations in the later part of the judgmant and observed On the strength of these observations it is urged that no action can lie against the Province of Bombay in respect of an act which is done in the exercise of its sovereign powers. It is said that the act of requisition cannot be done by a private individual, but it can only be done by an authority which is exercising a sovereign power. Now, it is to be noted that Peacock, Chief Justice, made it clear in his judgment that the East India Company was not a sovereign body and it did not have any attributes of sovereignty. If the learned Chief Justice was referring to sovereign acts as, acts of State, then with very great respect the observations are correct and must be accepted. An act of State is different fundamentally from an act of a sovereign authority. An act of State operates extraterritorially. Its legal title is not any municipal law but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In State of Rajasthan v. Mst. Vidhyawati this question again came up for consideration. Sinha C.J., delivering the judgment on behalf of the court, traced the history of the present. article 300 with reference to prior constitutional provisions and dealt with the question regarding the extent of liability of the State Government for tort in respect of the tortious acts committed by its servants. The facts of that case were that a jeep supplied by the State to the Collector when driven back from the repair shop to the Collector's office met with an accident and the question arose whether the driver of the vehicle while returning back four the workshop, was doing any act in connection with the exercise of sovereign power of the State. Their Lordships held that the State is liable for the damages occasioned and that no protection could be claimed by the State. Sinha C.J. discussed the decision in P & O. case, in full and held that the head-note in the Peninsular and Oriental Steam Navigation Company's case correctly brought out the decision. Their Lordships held : "In India, ever since the time of the East India Company the sovereign has been held liable to be sued in tort or in c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a military driver while transporting coal to the general headquarters at Simla (in this case the correct test was laid down and the suit was held maintainable). The next case of importance is the decision in Kasturi Lal Ralia Ram Jain v. State of U.P., relating to demages for illegal arrest and seizure of gold. Gajendragadkar C.J., in delivering the judgment on behalf of the Bench, placed considerable reliance upon the later half of the decision in Peninsular and Oriental Steam Navigation Company's case, in so far as it related to the distinction drawn therein between the tortious acts committed by public servants in course of the sovereign powers and tortious acts committed by them in respect of non-governmental functions. In other words, Gajendragadkar C.J. adopted the reasoning in the second part of the judgment of Peninsular and Oriental Steam Navigation Company's case, while referring to the decision in Vidhyawati's case. Thus, we have two decisions of the Supreme Court, namely, Vidhyawati's case, and Kasturi Lal's case, decided by the two Benches of equal strength, both relying on the decision of Sir Barnes Peacock in Peninsular and Oriental Navigation Company's case, takin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if laid before 1858, against the East India Company would have been maintainable. If the answer is yes, the suit will lie. In the present case, the talayari was put in charge of the attached sugarcane crops. He was negligent in safeguarding the same, which resulted in a theft of a portion of the attached crop. This resulted in the filing of a criminal case against the plaintiff, who was in possession of the crop prior to attachment and his acquittal on appeal. In this case the person who was put in charge happened to be a Government servant who was negligent in the discharge of his duties and a prosecution at his instance was thrown out and the present suit is filed for damages for malicious prosecution which will undoubtedly lie. We are not, however, saying that the suit should be decreed. We find support for our conclusion from the view of Shri H. M. Seervai in his book on Constitutional Law of India, at page 816, where the learned author states as follows : "Again the observation in the judgment that the distinction made in the P. & O. case between the trading and sovereign functions of the company had been consistently followed is clearly wrong and is made per curiam. Thirdl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dressed to the dead man and affixed to the property, the sale is void. A suit to set it aside is not subject to the period of limitation prescribed by section 59 of the Act." In Secretary of State for India in Council v. Nagaraja Iyer it is held that the period of limitation for a suit to recover a sum of money alleged to have been illegally levied and collected by the Government from the plaintiff as water cess on his land is one year from the date of payment under article 16 of the Limitation Act and not 6 months from the date of the distraint of the plaintiff's crop under section 59 of the Revenue Recovery Act. In Saminatha Aiyar v. Govindasami Padayachi, section 59 of the Act was held to have applied to the sale for arrears of revenue, which are illegal as contravening section 2 of the Regulation X of 1831 which prohibit the sale of estates of minors inherited by them for arrears of revenue accruing during the minority. In the present case the sale has not been held and the objection was taken, when notice demanding payment was issued to the defaulter's sons, that they were not defaulters and therefore section 59 of the Madras Revenue Recovery Act has no application. Our at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed on July 19, 1962, by the Sub-Collector, Tirupattur, as per exhibit B-13. Therefore, the position is that for the recovery of the arrears due from the assessee, the Tahsildar attached the properties in the possession of the lessee and belonging to the sons of the defaulter and the attached crops which were under the control of the thalayaris were stolen during such period. The learned counsel for the appellant contends that the recovery proceedings are bad, as the certificate stood only in the name of the defaulter and without an amendment of the certificate, the revenue authorities cannot proceed to realise the amount due by the defaulter. The contention on behalf of the revenue is that there is no need to amend the certificate issued by the Collector under section 46(2) and that the correspondence for recovery were legally continued by the Tahsildar against the properties of the deceased defaulter. The learned counsel referred us to section 24B of the Income-tax Act, 1922. Section 24B was inserted in 1932. Prior to that, the Act contained no procedure for assessment of the income of a deceased person. In the present case on the date of the assessment order the defaulter, Geng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive is to be regarded or to be deemed an assessee quoad the estate of the deceased, but not necessarily for the purpose of sub-section (3). In fact sub-section (3) does not say that a legal representative, for purposes of assessment, shall be deemed to be an assessee. The first part of sub-section (3) enables the Income-tax Officer to deal with a return submitted by the deceased which he believes to be incorrect or incomplete and make an assessment of his total income, and determine the tax payable by him on the basis of such assessment. In other words, it is within the contemplation of the first part of sub-section (3) that the assessment is made on the estate of the deceased and it is only for the purpose of representation, the procedure in the second part of sub-section (3) has been prescribed and that if the procedure prescribed therein has already been followed, it is not contemplated by sub-section (3) that it should be reiterated in the presence of the legal representative. Where the procedure has already been followed, all that remains to be done is to bring the legal representative on record and proceed with the assessment proceedings fro the point at which they were left ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lter's son failed to comply with the demand, the village munsiff attached the sugarcane crop standing on the land of the defaulter. Meanwhile, the lessee (plaintiff) filed a claim petition before the Sub-Collector. The Sub-Collector passed final orders on July 19, 1962. But, the plaintiff did not follow it up. The attached sugarcane crop was put in possession of the village munsiff. Before the attached crops could be sold there was a theft of a portion of the crop and the lessee (plaintiff) was arrested in that connection. The police filed a case against him and he was convicted. On appeal the plaintiff was acquitted. The plaintiff has filed the present suit claiming damages for malicious prosecution. The courts below dismissed the suit as the attachment was validly made and the revenue authorities acted in accordance with law and there is no proof of malice. We are of opinion that the revenue authorities acted according to law and in the absence of malice the claim for damages under the various heads claimed cannot be sustainable. This answers the fourth point raised by the appellant's learned counsel. We have no hesitation in dismissing the appeal. As the plaintiff has succeeded ..... X X X X Extracts X X X X X X X X Extracts X X X X
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