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TMI Blog1977 (3) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... eturn filed he had not made a claim towards rebate for life insurance premia paid by him during the relevant accounting year. It is to quash this order that this writ petition has been preferred. The learned counsel for the writ petitioner draws my attention to section 34 of the Kerala Agricultural Income-tax Act, 1950, and states that the power of revision of the Commissioner is wide in its amplitude and he has also power to make such enquiry. He is further enabled to pass such orders thereon as he thinks fit subject to the provisions of the Kerala Agricultural Income-tax Act, 1950. Under the provisions of the Act, viz., section 10(1)(e) any sum paid towards the insurance premium is exempt. Having regard to these provisions, the rejection of the revisional authority to grant exemption is incorrect since it is a jurisdictional issue. In support of this submission, the learned counsel for the petitioner relies on Pandit Sheo Nath Prasad Sharma v. Commissioner of Income-tax [1967] 66 ITR 647 (All), Union Coal Co. Ltd. v. Commissioner of Income-tax [1968] 70 ITR 45 (Cal), Commissioner of Income-tax v. Gurjargravures Pvt. Ltd. [1972] 84 ITR 723 (Guj) and Giridharlal Parasmal v. State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or Marumakkathayam tarwad, to effect an insurance on the life of any member of such family or tarwad: Provided that the aggregate of any sums exempted under this section shall not exceed one-sixth of the total agricultural income of the assessee or six thousand rupees, whichever is less: Provided further that nothing contained in this section shall be deemed to entitle a person who is assessed to income-tax under the Indian Income-tax Act, 1922, to claim any deduction in respect of any sum referred to in this section if it was exempted under section 15 of the said Act." Section 10 is one in which the exemption from assessment of agricultural income is catalogued. Therefore, the power of assessment is only subject to this provision. That being so, the amount paid towards the insurance premium will automatically stand exempted. However, in this case, unfortunately such an exemption had not been claimed and it was claimed for the first time in the revision. Nevertheless, can the revisional authority refuse, as he has done, on the single ground that such an exemption was not claimed before the original authority ? I will have to answer this question in favour of the assessee, say ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a certain sum of money has been received by him, the fact of that receipt may be accepted without anything more as constituting an admission on the part of the assessee. That would be an admission as to a state of fact. But whether the receipt can be considered as taxable income is quite another matter, and consideration of that question leads into the realm of law. If the Income-tax Officer assesses an assessee upon a receipt which is not taxable in law, it is always open to the assessee to take the case in appeal or in revision thereafter. It is then for the Appellate Assistant Commissioner or the Commissioner of Income-tax, as the case may be, to examine the matter and determine whether, although the money has been received by the assessee, it is taxable in law. The assessee is then within his rights in requiring the appellate or the revisional authority to examine the validity of the assessment to tax of a receipt which, though admitted by him, is not taxable in law." Again, in Union Coal Co. Ltd v. Commissioner of Income-tax [1968] 70 ITR 45, 52 (Cal), dealing with the appellate powers, it was held as follows: "Nothing debars an assessee from making a new claim for deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1967] 20 STC 64 (Mys) in the return of the assessee, exempted turnover was included by mistake and it was assessed. The question was whether that mistake could be corrected at the appellate stage. It was held therein as follows: "The duty of the assessing officers is not merely to impose tax that is lawfully exigible but also to give to the assessees the benefit of any reduction or exemption that may become due to them upon facts actually found to be true by the assessing authorities, whether or not the assessees, out of ignorance or by mistake, make a claim thereto. When the mistake is obvious and the matter is taken up on appeal, it is the duty of the appellate authorities to correct the mistake." The principles adumbrated in all these decisions will squarely apply to this case. Reliance placed by the department on Bombay Ammonia Pvt. Ltd. v. State of Tamil Nadu [1976] 37 STC 517 (SC) is ill founded. That was a case in which the suo motu powers were sought to be exercised by the Board of Revenue. At that stage, the assessee who had acquiesced in the original assessment sought to claim exemption that certain portion of the assessment related to works contracts and, therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... STC 353 (SC). We are, therefore, of the view that the Deputy Commissioner rightly refused to exercise his revisional jurisdiction in favour of the appellants and the High Court was right in reversing the order of the Appellate Tribunal in so far as it related to the appellants' claim to the aforesaid exemption." What has to be noted in this case is that not only the assessee had acquiesced in the order of assessment but he did not take any steps to have that portion of the order revised or modified. But the case on hand is entirely different. In view of the above, I hold that the impugned order is liable to be quashed and is hereby quashed and the matter will stand remitted to the revisional authority for reassessment in the light of the observations made above. The petitioner will be entitled to his costs. Counsel's fee Rs. 150. In W.Ps. Nos. 1449 of 1974 and 1450 of 1974, the facts are identical as those of W.P. No. 1448 of 1974, excepting that they relate to a different assessee, the assessment year being the same, viz., 1971-72. Applying my judgment in W.P. No. 1448 of 1974, these writ petitions will stand allowed and the matter will stand remitted to the revisional authori ..... X X X X Extracts X X X X X X X X Extracts X X X X
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