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TMI Blog1976 (5) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... Agricultural Income-tax Officer had disallowed out of the expenses claimed for the upkeep and maintenance of the immature area Rs. 2,500 for the year 1959-60 and Rs. 3,500 for the year 1960-61. T. V. Kochuvareed died in 1961 leaving behind him as his heir and legal representative his wife who is the respondent before us. On March 13, 1963, the Commissioner of Agricultural Income-tax issued a notice under section 34 of the Kerala Agricultural Income-tax Act, 1950, to the respondent, which was served on her on March 15, 1963, proposing to revise suo motu the assessment for the said two years on the ground that the deductions allowed were excessive and without any proper basis as a result of which Rs. 16,800 for the year 1959-60, and Rs. 25,800 for 1960-61 had "escaped assessment". The respondent was asked to file objections, if any, within fifteen days of the receipt of the notice. The respondent in her objection contended that the proposed revision of her husband's income which was said to have "escaped assessment" was outside the scope of section 34. On this objection another notice was served on her on September 26, 1966, stating that the expression "escaped assessment" used in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecified in section 9 and all receipts of the description specified in section 10(a), (c) and (d). Section 5 enumerates the deductions from the total income which have to be made in computing the agricultural income. Section 17(1) of the Act requires every person whose total agricultural income during the previous year exceeded the limit which is not chargeable to agricultural income-tax, to furnish to the Agricultural Income-tax Officer a return stating his total agricultural income in that year and the expenditure incurred by him out of that income. Section 18 deals with the powers of the Agricultural Income-tax Officer to assess the total agricultural income of the assessee and determine the sum payable by him. Section 19 authorises the Agricultural Income-tax Officer to cancel the assessment in certain cases at the instance of the assessee and to make a fresh assessment in accordance with the provisions of secton 18. Section 31 provides an appeal to the Assistant Commissioner against any order of assessment with which the assessee is dissatisfied. Sub-section (7) of the section requires the Assistant Commissioner to communicate the orders passed by him disposing of the appeal to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the tax shall be charged at the rate at which it would have been charged if such income had not escaped assessment or full assessment, as the case may be : Provided further that the Agricultural Income-tax Officer shall not issue a notice under this sub-section unless he has recorded his reasons for doing so. (2) No order of assessment under section 18 or of assessment or reassessment under sub-section (1) of this section shall be made after the expiry of three years from the end of the year in which the agricultural income was first assessable : Provided that where a notice under sub-section (1) has been issued within the time therein limited, the assessment or reassessment to be made in pursuance of such notice may be made before the expiry of one year from the date of the service of the notice even if at the time of the assessment or reassessment the three years aforesaid have already elapsed : Provided further that nothing contained in this section limiting the time within which any action may be taken or any order, assessment or reassessment may be made shall apply to a reassessment made under section 19 or to an assessment or reassessment made in consequence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court any question of law arising out of such order. The majority decision of the High Court took the view that this was a case of escaped assessment and that the power of revision conferred on the Commissioner by section 34 of the Act could not be, utilised for the purpose of reassessment of income that escaped assessment disregarding the provisions of section 35. Sub-section (1) of section 34 makes it clear that the power of revision is exercisable "subject to the provisions of this Act". It was pointed out in the majority judgment that section 35 contains a specific provision for reassessment of income that had escaped assessment and it was held that revisional powers under section 34 could be availed of to reopen cases of escaped assessment only within the time limit and in accordance with the procedure prescribed by section 35. Before us, Mr. Patel, learned counsel for the respondent, reiterated the same contention. Mr. Krishnamurthy Iyer appearing for the appellant challenged the decision of the High Court on two grounds : (1) the income sought to be reassessed was not income that had "escaped" assessment and, as such, the provisions of section 35 are not relevant for th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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