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TMI Blog1988 (10) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... making has its own complexities. This enactment also had its share. The legislation was not born on the very day of the commencement of the financial year. Though the Act was brought into force only in August, 1960, the device of a statutory fiction helped to net the tax for that year also. Our Legislature too has extraordinary abilities, though not to the full measure of the mother of Parliaments, the British Parliament, which could, as it is said, perform by means of a statute, any feat other than making a man a woman or a woman a man. A new Government assumed office in the State, soon after the elections of March, 1987. During the election campaign, the front of political parties (which came to office later) had exhibited to the electorate a cute basket of promises and programmes. Promises are easily made. Implementation is difficult. Resource mobilisation is not an easy exercise even for expert economists. There was obvious paucity of time, for a leisurely presentation of the budget and a detailed discussion thereon. That is evident from the Budget Speech of the Minister of Finance presented later on June 5, 1987. The relevant portion reads : "As Honourable Members are aw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Act, 1960, by substituting new Schedule for the existing one. The report of the Subject Committee was published in the Gazette dated August 11, 1987. The Subject Committee suggested some modifications to the new bill. They are not, however, relevant, as regards the changes introduced in the plantation tax. The bill was ultimately passed by the Legislature and it received the assent of the Governor on August 20, 1987. Under section 1(2) of the new Act, there was a deeming provision, making the Act effective from July 1, 1987. Collection of tax at the revised rates was resisted by some among the planters. The resistance is advantageous and without risk. It helps at least to retain the money for some little time more. Those who offered resistance sought reference of the questions of law to the District Court, as provided under the parent Act. The learned Government Pleader submitted that the references have been answered in some areas adverse to the State. The taxpayer is entitled to say : let there be an authoritative and final decision. That decision has to be initially rendered by the High Court. The Supreme Court is then to consider the correctness of the view of the High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. The court has necessarily to evaluate the contention of the petitioners, whatever be the callous negligence on the part of the respondents. Interpretation of any legislation is not to be made on the basis of default or even a concession rashly made. (Vide Hindustan Paper Corporation Ltd. v. Government of Kerala, AIR 1986 SC 1541.). Could the levy be effective from the first of April, 1987, with the existing provisions of the amendment Act ? Some aspects of this taxation measure came up for examination by this court when the parent Act was enacted. What exactly is the incidence of the plantation tax ? Is it on land or is it on land revenue ? After detailed examination of the scheme of the enactment, Govindan Nair J., as he then was, held that the tax was one in exercise of the constitutional power under entry 49 of the Seventh Schedule-"Taxes on Lands and Buildings". (There appears to be an obvious clerical error, when the entry is referred to as 45. The correct figure the court had in mind must be 49). A Division Bench in Essa Ismail alias Babu v. State of Kerala [1965] KLT 944 affirmed that decision. In view of the pronouncement of this court, there could be no long ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to construction. The principles have been reiterated by Knox J. in Russell v. IRC [1988] 2 All ER 405 at 418 (Ch D). It is useful to bear in mind some well recognised statutory practices in relation to the taxation statutes. The Finance Art, passed later, can act and affect the citizens in retrospect. In relation to the income of a previous year, the levy and collection could be indicated by the Finance Act of the assessment year. The Estate Duty Act links the levy with the estate of the deceased as on the valuation date. The rate supplied by the Finance Act sometimes operates on a date much prior to the valuation date. That is noticeable in the administration of the taxation on wealth also. As for the plantation tax, the extent of the plantation on the first of April is relevant. Not necessarily the rate. Once the extent as on the date is determined, the assessing authority is to apply the proper rate as given in the Schedule. When the Finance Act of 1987 is passed, the assessing authority is bound to apply the rate relevant for that year as is noticeable from the Finance Act of that year. In relation to the assessment year 1987-88, the rates would be those indicated by the am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te Ltd.'s case [1966] 60 ITR 262, 266, in these words : "This decision is an authority for the proposition that though the subject of the charge is the income of the previous year: the law to be applied is that in force in the assessment year, unless otherwise stated or implied." (emphasis supplied) It is evident from the above passages that the turnover of a previous year can justifiably be converted by a statutory fiction as the turnover of the assessment year. It is open to the Legislature to completely alter the tax liability by the imposition of a different tariff in the course of the year. The Finance Act of any year is to be applied for the assessment of that year. In the present case, the Finance Act relevant for the assessment year 1987-88 is the Finance Act of 1987. Substituting the Schedule as for the assessment year 1987-88, the tax liability is competently altered, as it is case of "imposition of a different tariff in the course of the year". As noted earlier, that was what was clearly proclaimed as the intention of the Government. It is that intention that is specifically postulated in the preamble to the Act. There could, therefore, be no scope for doubt that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act came into force, it cannot be said that the transactions during those months are exempt from the surcharge leviable under the Act. This does not mean that the Act is retroactive in character. A statute is not retrospective simply because a part of the requisites for its action is drawn from a time antecedent to its passing" (Craies on Statute Law, 5th Edition, p. 357). An application of the principle contained in the above decision will result in repulsing the arguments of the petitioners. If at all, the present case is stronger for the State than the one in Varkey Thomas' case [1960] KLT 145 for, unlike the sales transactions having their individual existence, the assessment of the plantation tax has got, in the scheme of things, a link with the time of assessment, and the governing rates in accordance with the schedule on force on that day. The extent of the plantations alone is borrowed from yesterday, the first day of April, 1987. In the light of the above discussion, the writ petitions have to fail. dismiss the writ petitions. Before parting with the case, the court has to express its strong disapproval of the conduct of the case on the part of the State Government. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consequences of laxity, incompetence, irregularity, indolence. Honour and material benefits are gained by the person who discharges his trust with zeal and fidelity ; humiliation and actual want may be the portion of those who err, not necessarily through dishonesty, but through inattention or lack of judgment." Constitutional protection afforded to civil servants does not fundamentally change their basic responsibilities. That noted work contains a picturesque passage on the doctrine of ministerial responsibility, "the main shaft and supporting pillar of our political edifice". At a time and in a situation where the basics appear to get blurred, the entirety of the passage is worth reproducing. It reads : "But they (ministers) are seldom 'experts' in a business, to which they bring no more than a general knowledge of affairs, such as a reasonably intelligent person may be assumed to possess. Sometimes they may not even reach this moderate standard ... It may not be essential that he who drives fat oxen should himself be fat; ... The system (accountability of ministers) is defended on the ground that after all, precise and comprehensive knowledge of the details of his office ..... X X X X Extracts X X X X X X X X Extracts X X X X
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