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PETITIONER: C.I.T. CENTRAL, CALCUTTA

       Vs.

RESPONDENT: NATIONAL TAJ TRADERS

DATE OF JUDGMENT27/11/1979

BENCH: TULZAPURKAR, V.D. BENCH: TULZAPURKAR, V.D. VENKATARAMIAH, E.S. (J)

CITATION:  1980 AIR  485            1980 SCR  (2) 268  1980 SCC  (1) 370  CITATOR INFO :  R          1982 SC 149  (256)  R          1984 SC 420  (38)  R          1984 SC 993  (21)

ACT:      Income  Tax  Act,  1922,  Section  33B-Construction  of section 33B  with particular  bearing on  the scope  of  the appellate powers of the Tribunal under sub-section 4 thereof and the  effect of  sub-section 2(b)  on  sub  section  (4)- Whether sub  section 2(b)  of section  33B has the effect of attenuation  or  curtailing  the  appellate  powers  of  the Tribunal under sub section 4.

HEADNOTE:      In respect  of the  accounting years  ending March  31, 1957 and  March 1958  respectively on  the voluntary returns submitted by the respondent, the Income Tax Officer ’E’ Ward District II  (1) Calcutta completed the assessment for these years (1957-58  and 1958-59)  on total incomes of Rs. 7000/- and Rs.  7500/- respectively,  the same  having been made in the  status   of  unregistered   firm  consisting  of  three partners, namely Asha Devi Vaid, Santosh Devi Vaid and Sugni Devi  Vaid  with  equal  shares.  On  August  2,  1962,  the Commissioner of  Income Tax  issued notice to show cause why the said  assessments should  not be cancelled under section 33B of  the Act  as he  felt that  the completed assessments were erroneous  as being prejudicial to the interests of the Revenue and  the Income  Tax Officer ’E’ Ward District II(1) Calcutta had  no territorial  jurisdiction over  the case of the assessee.  The notice  was served  on  the  assessee  on August 3, 1962 and the hearing was fixed by the Commissioner for August  6, 1962.  On the  ground that  none appeared and there was  no application  for adjournment, the Commissioner passed his order under section 33B ex parte on that date.      By  his  said  order  the  Commissioner  cancelled  the assessments made  by the Income Tax Officer on three grounds (a) that  some of  the partners  were minors  and  were  not competent to  enter into  any partnership agreement with the result that  the status of unregistered firm assigned to the assessee by  the Income Tax Officer was clearly wrong and as such the  assessments deserved to be cancelled; (b) that the books of accounts were unreliable and they were not properly

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examined by  the Income Tax Officer with the result that the assessments made  were prejudicial  to the  interests of the revenue  and   (c)  that  the  Income  Tax  Officer  has  no territorial jurisdiction  over the  case which  fell in  the jurisdiction of  Income Tax  Officer, District  III Calcutta and  directed   the  Income   Tax  Officer   having   proper jurisdiction to  make fresh  assessments after examining the records of the assessee in accordance with law.      The appeals  preferred to  the Appellate Tribunal under section   33B(3)    were   accepted.    Finding   that   the Commissioner’s order  passed at  11.30 A.M. ex parte was bad in as  much as the notice served upon the assessee permitted filing of objections at any time during the course of August 6, 1962  and the  objections were in fact filed later in the day, the  Tribunal remanded  the case  with the direction to dispose it  of afresh  after giving  due opportunity  to the respondent assessee. On a reference to the High Court at the instance of the appellant, the 269 High Court  held: (a)  the assumption of jurisdiction by the Commissioner under  section 33B  of the  Income Tax  Act was valid in law; (b) the Tribunal acted properly in vacating or cancelling the  Commissioner’s order,  but, (c) the Tribunal did not  act properly  in directing  the Commissioner to act under section 33B(1) because the period of limitation of two years prescribed under section 33(2)(b) for him to act under section 33B(1) had expired. In doing so, the High Court held that the  provision of  sub section  2(b) was  absolute  and covered even  a revisional  order of the Commissioner passed in  pursuance   of  a   direction  given  by  any  appellate authority.      Allowing the appeal by Certificate, the Court ^      HELD: 1.  Under sub  section (1)  of section 33B of the Income  Tax   Act,  power   has  been   conferred  upon  the Commissioner to  revise Income-Tax  Officer’s orders but the exercise of  such power  is regulated  by the two conditions mentioned therein  namely, (a)  he must  consider the  order sought to be revised to be erroneous as being prejudicial to the interests  of the  revenue  and  (b)  he  must  give  an opportunity to  the assessee  of being heard before revising it. Sub-s.  (2)(b) prescribes  a  period  of  limitation  in negative words  by providing  that "no  order shall  be made under sub-s(1)  after the  expiry of two years from the date of the order sought to be revised". Sub-s.(3) confers on the assessee a  right to  prefer an  appeal  to  the  Appellate. Tribunal against  the Commissioners’  order made  under sub- s.(1) while  sub-s. (4) indicates the power of the Appellate Tribunal in dealing with such appeal by providing that "such appeal shall  be dealt with in the same manner as if it were an appeal  under sub-s.(1)  of s.  33". Two things stand out clearly on  a fair  reading of the two concerned provisions, namely, sub-s.(2)(b)  and sub-s.(4).  The bar  of limitation contained in sub-s. (2)(b) is on the Commissioner’s power to pass revisional orders under sub-s. (1) and the same appears to be  absolute in  the sense that it applies to every order to be  made under  sub-s.(1). At  the  same  time  sub-s.(4) confers on  the Appellate Tribunal very wide powers which it has while  dealing with  an appeal  under s. 33(1). In other words, the Appellate Tribunal has power "to pass such orders thereon (i.e.  on the  appeal)  as  thinks  fit."  The  word "thereon"  restricts   the  jurisdiction  of  the  Appellate Tribunal to  the subject-matter  of the  appeal which merely means that  the Tribunal cannot adjudicate or give a finding on a  question which  is not  in dispute  and which does not

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form the  subject-matter of  the appeal  but the words "pass such orders thereon as it thinks fit" include all the powers (except  possibly   the  power  of  enhancement)  which  are conferred on  the Assistant  Appellate Commissioner by s. 31 and consequently  the Tribunal  has authority in exercise of its appellate powers to set aside the order appealed against and direct fresh assessment in the light of the observations made by it in its judgment. In other words, similar power is possessed by  the Appellate  Tribunal while dealing with the appeal under sub-s.(4) of s. 33B. [275 A-H, 276 A]      Hukamchand Mills’s case, 63 I.T.R. 232; applied.      2. Two principles of construction are relating to casus omissus and  the other in regard to reading the statute as a whole are  well settled.  Under the first principle, a casus omissus cannot  be supplied  by the Court except in the case of clear  necessity and  when reason  for it is found in the four corners  of the  statute itself  but at the same time a casus omissus should not be readily inferred and 270 for that  purpose all the parts of a statute or section must be construed  together and  every clause of a section should be construed with reference to the context and other clauses thereof so  that the  construction to be put on a particular provision makes a consistent enactment of the whole statute. This  would   be  more  so  if  literal  construction  of  a particular clause  leads to  manifestly absurd  or anomalous results  which   could  not   have  been   intended  by  the Legislature. [277 B, 278 A-B]      Artemiou v.  Procopiou, [1966]  1 Q.B.,  878,  Luke  v. Inland Revenue  Commissioner [1968]  A.C. 557 and 577 Quoted with approval.      3. The  object of  introducing Section  33B with effect from March 30, 1948 was to confer revisional powers upon the Commissioner to  correct the  erroneous orders  of an Income Tax Officer  in so  far as  they  were  prejudicial  to  the interests of  the revenue.  The language  of the sub-sec.(1) clearly suggests  that the said power was contemplated to be exercised suo  motu by  the  Commissioner  inasmuch  as  the opening words show that it was upto the Commissioner to call for and  examine the record of any proceedings under the Act and on  examination of  the record if he were satisfied that any order  passed by  an Income Tax Officer was erroneous as being prejudicial  to the  interests of the revenue he could revise the  same after giving an opportunity to the assessee of  being  heard.  It  is  true  that  sub-s.(2)(b)  thereof prescribed a  period of limitation on his power by providing that no order shall be made under sub-s.(1) after the expiry of the  two years  from the  date of  the order sought to be revised by  the Commissioner  and a  literal construction of sub-s.(2)(b)  also  suggests  that  the  bar  of  limitation imposed thereby was absolute in the sense that it applied to every kind  of order  to be  made  under  sub-s.(1)  and  no distinction was  made between  a suo motu order and an order that might  be made  by him pursuant to a direction given by any appellate or other higher authority. Sub-s.(3) conferred on an  assessee a right to prefer an appeal to the appellate Tribunal against  the Commissioner’s  order made  under  sub section (1)  and under  sub-s.(4) the Tribunal had authority to deal  with the impugned order of the Commissioner in such manner as it deemed fit in exercise of its appellate powers; for instance,  it could confirm the impugned order, it could annul that  order, or  it could after vacating it remand the case back  to the Commissioner for making a fresh assessment in the  light of the observations made by it in its judgment or it  could after  calling for a remand report, rectify the

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erroneous order of the Income Tax Officer. Further there was no period  prescribed within  which an  appeal  against  the impugned order  of the Commissioner had to be disposed of by the Tribunal and in the normal course on rare occasions such appeals would  have been  heard and  disposed of  before the expiry of  two  years  from  the  date  of  the  Income  Tax Officer’s  order  which  was  regard  as  erroneous  by  the Commissioner. More often than not such appeals would come up for hearing  after the  expiry of  the said  period  of  two years-a fact fully known and within the contemplation of the Legislature when  it introduced  the section  in the  Act in 1948. [278 E-H, 279 A-D]      4. The  Legislature did  not  intend  to  attenuate  or curtail the  appellate powers  which  it  conferred  on  the appellate Tribunal  in very  wide terms  under sub-s.(4)  by enacting sub  section 2(b)  prescribing a  time limit on the Commissioner’s power  to reverse  an erroneous  order of the Income Tax  Officer when  the Commissioner  was seeking  the exercise the  same not  suo motu  but  in  pursuance  of  or obedience to  a direction  from the appellate authority. Any contrary and  literal construction  would lead to manifestly absurd result, because in a given 271 case, like  the present  one where  the appellate  authority (Tribunal) has  found (a)  the Income Tax Officer’s order to be clearly  erroneous as  being prejudicial to the interests of  the   revenue   and   (b)   the   Commissioner’s   order unsustainable as being in violation of principles of natural justice; it  would be  difficult for the appellate authority to exercise  its powers. Obviously it could not withhold its hands and  refuse to  interfere  with  Commissioner’s  order altogether, for,  that  would  amount  to  perpetuating  the Commissioner’s erroneous  order, nor  could it merely cancel or set  aside the  Commissioner’s wrong  order without doing anything about  the Income  Tax Officer’s  order, for  that, would result  in perpetuating the Income Tax Officer’s order which had  been found  to be  manifestly erroneous  as being prejudicial to  the revenue.  Moreover, in  exercise of  its appellate powers  it was open to the Tribunal itself to call for a  remand report  from either  the Commissioner  or  the Income Tax  Officer and  rectify the  Income  Tax  Officer’s erroneous order after giving opportunity to the assessee and in doing  so no  question of  limitation would arise. It was equally open to the Tribunal to set aside the Commissioner’s order and remand the case directly to the Income Tax Officer giving requisite  direction to  rectify his  erroneous order and thereupon  the Income  Tax Officer  would carry  out the Tribunal’s direction  for, admittedly, the bar of limitation under sub-s.(2)(b)  was only  on the Commissioner’s power to make an assessment afresh and not on the Income Tax Officer. If this be the correct position then it is gravely anomalous that the  Tribunal should  not be in a position to set aside the Commissioner’s  order and  remand the  case back  to the Commissioner for  making a  fresh assessment  because in the meantime two  years’ period  of limitation has expired, for, it would mean that the Tribunal was prevented from achieving the desired  effect directly through the Commissioner but it could do  so indirectly  through the  Income Tax  Officer. A literal construction  placed on  sub-s.(2) (b) would lead to such manifestly  absurd and  anomalous results,  which, were not intended  by the  Legislature. Therefore,  the words  of sub-section 2(b)  should be construed as being applicable to suo motu  orders of  the Commissioner in revision and not to orders made  by him  pursuant to a direction or order passed by the  Appellate Tribunal  under sub-s.(4)  or by any other

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higher authority.  Such construction  will be  in consonance with the  principle that  all parts of the section should be construed  together  and  every  clause  thereof  should  be construed with  reference to  the context  and other clauses thereof so  that the  construction put  on  that  particular provision makes a consistent enactment of the whole statute. [279 D-H, 280 A-G]      Commissioner of Income Tax v. Kishoresingh Kalyan Singh Solanki, 39, I.T.R. 522 (Bombay); approved.      It is  well settled  that the principle that the fiscal statute should  be construed  strictly is applicable only to taxing  provisions   such  as  a  charging  provision  or  a provision imposing  penalty and  not to  those parts  of the statute which contain machinery provisions and by no stretch could s. 33B be regarded as charging provision. [281 C-D]      6. A  casus omissus  has not to be readily inferred and it could  not be  inferred from  the mere fact that both ss. 33B and 34(3) together with the second proviso were inserted simultaneously in  the Act  by the same Amending Act of 1948 and that  in the case of former a relaxing provision was not made as  was made  in the  case  of  the  latter  provision, firstly because  the two  provisions  operated  in  distinct fields and  secondly it  would be  improper to do so without compar- 272 ing the  various stages of amendments through which each set of these  Provisions  had  undergone  since  inception.  The further aspect  the Legislature has in the 1961 Act made the requisite  provision   removing  or   relaxing  the  bar  of limitation, in  section 263(3),  is, not of much importance. Irrespective of  the question  whether the second proviso to section 34(3)  was enacted  ex majore  cautella or not (over which conflicting  views obtain)  it is clear that s. 263(3) of the  1961 Act  must be  regarded as an ex majore cautella provision. Admittedly,  at the  time when the said provision was enacted  in the 1961 Act, the Bombay view held the field and there  was no decision to the contrary of any other High Court. Obviously, therefore, the enactment of s. 263(3) must be regarded  as declaratory  of the  law which  was  already prevailing and this position has been clarified in the Notes on Clauses  of the  Income Tax  Bill 1961  where it has been stated that sub-cl. (3) of s. 263 was new and had been added to get  over the  difficulty experienced  in (wrongly stated ’caused by’)  the Bombay  High Court’s decision in Solanki’s case. The  enactment of  an ex  majore cautella provision in the 1961  Act would, therefore, be a legislative recognition of the  legal position that obtained as a result of judicial pronouncement qua the 1922 Act. [281 E-H, 282 A]      C.I.T. v.  Sabitri Devi  Agarwalla, 77  I.T.R. 934 over ruled.      Pooran Mall’s case, 96 I.T.R. 390; relied on.

JUDGMENT:      CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 171-172 of 1973.      From the  Judgment and  Order  dated  9-3-1972  of  the Calcutta High Court in I.T Reference No. 117/67.      D. V. Patel, S. P. Nayar and Miss A. Subhashini for the Appellant.      B. B. Ahuja (Amicus Curiae) for the Respondent.      The Judgment of the Court was delivered by.      TULZAPURKAR, J.-These  two appeals by certificate raise an important  question as regards the proper construction of

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s. 33B  of the  Indian Income  Tax Act, 1922 with particular bearing on the scope of sub-s. (4) thereof and the effect of sub-s. (2) (b) on the sub-s. (4).      The facts  giving rise  to the  aforesaid question  may briefly be stated: The assessment years involved are 1957-58 and 1958-59  corresponding to  the accounting  years  ending March 31,  1957 and March 31, 1958 respectively. On or about August 5,  1960 the  respondent-assessee submitted voluntary returns, inter  alia, for  the  said  two  assessment  years alongwith a declaration dated August 8, 1960. The assessment for these  years were  completed on  August 12,  1960 by the Income-Tax Officer,  ’E’ Ward,  District II(1)  Calcutta  on total incomes  of Rs.  7,000/- and 7,500/- respectively, the same having  been made  in the  status of  unregistered firm consisting of three partners, namely, 273 Asha Devi  Vaid, Santosh  Devi Vaid and Sugni Devi Vaid with equal shares.      On August  2,  1962,  the  Commissioner  of  Income-Tax issued a  notice to  show cause  why  the  said  assessments should not  be cancelled  under s. 33B of the Act as he felt that the  completed  assessments  were  erroneous  as  being prejudicial to  the interests  of the  revenue and  that the Income-Tax Officer, ’E’ Ward, District II(1) Calcutta had no territorial jurisdiction  over the case of the assessee. The notice was  served on the assessee on August 3, 1962 and the hearing was fixed by the Commissioner for August 6, 1962. On the  ground  that  none  appeared  and  that  there  was  no application for  adjournment, the  Commissioner  passed  his order under  s. 33B ex parte on that date. By his said order the Commissioner  cancelled  the  assessments  made  by  the Income-Tax Officer  on August 12, 1960 on three grounds: (a) that some of the partners were minors and were not competent to enter into any partnership agreement with the result that the status  of unregistered  firm assigned to the assesse by the Income-Tax  Officer was  clearly wrong  and as  such the assessments deserved  to be cancelled, (b) that the books of account were  unreliable and they were not properly examined by  the   Income-Tax  Officer   with  the  result  that  the assessments made  were prejudicial  to the  interests of the revenue and (c) that the Income-Tax Officer concerned had no territorial jurisdiction over the case which fell within the jurisdiction  of   Income-Tax  Officer,   District   III(II) Calcutta, and directed the I.T.O. having proper jurisdiction to make  fresh assessments after examining the record of the assesse in accordance with law.      In the  appeals preferred  to  the  Appellate  Tribunal under s.  33B(3) the respondent-assessee challenged the said order of  the Commissioner on various grounds. The Tribunal, negativing all other contentions of the respondent-assessee, came to  the conclusion  that on  merits the facts justified the  assumption   of  jurisdiction   under  s.  33B  by  the Commissioner  but   held  that   the  Commissioner  had  not conformed to  the requirements of natural justice by putting to the  respondent assessee  what case it had to meet and by giving due opportunity for explaining the same. The Tribunal noted that  the Commissioner  had disposed  of the matter at 11.30 A.M.  when none  appeared on behalf of the respondent- assessee while  the notice  served upon the latter permitted filing of objections at any time during the course of August 6, 1962  and objections  had been  filed by  the respondent- assessee later  in the day. The Tribunal, therefore, allowed the appeals,  vacated the  Commissioner’s order dated August 6, 1962 and remanded the case to him with the 274

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direction  to   dispose  it   of  afresh  after  giving  due opportunity to the respondent-assessee.      Feeling aggrieved  by the  Tribunal’s  aforesaid  order dated July  5, 1965  the appellant  sought to refer a set of six questions  of law said to arise out of the said order to the Calcutta  High  Court  but  the  Tribunal  referred  the following two  questions only  for the  opinion of  the High Court:      "1.   Whether on  the facts and in the circumstances of           the case,  the Tribunal  was right in holding that           the assumption of jurisdiction by the Commissioner           under s.  33B of  the Income-Tax  Act was valid in           law?      2.    Whether, on the facts and in the circumstances of           the case,  the Tribunal acted properly by vacating           the order  of the Commissioner under s. 33B of the           said Act  and in  directing him  to dispose of the           proceedings under  the said  section afresh  after           giving due opportunity to the assessee?"      The  High   Court  disposed   of  the  Reference  (I.T. Reference No.  117 of  1967) by  its judgment dated March 9, 1972  whereby   it  answered   the  first  question  in  the affirmative against  the assessee, that is to say, on merits it held  that the assessments made by the Income-Tax Officer required revision  at the  hands  by  the  Commissioner.  As regards the  second question  the High Court was of the view that it  comprised two aspects, one relating to the vacating of the  Commissioner’s order  and the  other relating to the giving of a direction to him to dispose of the case under s. 33B afresh  after giving due opportunity to the assessee and the High Court held that in exercise of its appellate powers the Tribunal  acted properly  in vacating  or cancelling the Commissioner’s order  but did  not act properly in directing him to  dispose of  the case  afresh under s. 33B(1) because the period  of limitation  of two  years prescribed under s. 33(2)(b) for  him to  act under  s. 33B(1)  had expired  and answered the  question accordingly  (i.e. in the affirmative on the  first aspect  and in  the  negative  on  the  second aspect). In  doing so the High Court held that the provision of sub-s.  2(b) was  absolute and  covered even a revisional order of the Commissioner passed in pursuance of a direction given by  any appellate  authority and relied in that behalf on the  aspect that, unlike 2nd proviso to sec. 34(3), there was no  provision removing or relaxing the bar of limitation on the  power of  the Commissioner under s. 33B(2) (b) . The High Court  preferred the  view of  the Assam  High Court in C.I.T. v. Sabitri Debi 275 Agarwalla(1) to  the view of the Bombay High Court in C.I.T. v. Kishoresingh  Kalyansinh Solanki(2). The Revenue has come up in appeal to this Court challenging the aforesaid view of the High Court.      Since the  question relates  to the proper construction of s. 33B of the Act with particular bearing on the scope of the appellate  powers  of  the  Tribunal  under  sub-s.  (4) thereof and the effect of sub-s. (2) (b) thereon, it will be desirable to  note the  material provisions of s. 33B. Under sub-s. (1) power has been conferred upon the Commissioner to revise Income-Tax  Officer’s orders but the exercise of such power is  regulated by the two conditions mentioned therein, namely, (a)  he must consider the order sought to be revised to be erroneous as being prejudicial to the interests of the revenue and  (b) he must give an opportunity to the assessee of being heard before revising it. Sub-s. (2) (b) prescribes a period  of limitation  in negative words by providing that

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"no order shall be made under sub-s. (1) after the expiry of two years  from the date of the order sought to be revised." Sub-s. (3)  confers on  the assessee  a right  to prefer  an appeal to  the Appellate Tribunal against the Commissioner’s order made  under sub-s.  (1) while sub-s. (4) indicates the powers of the Appellate Tribunal in dealing with such appeal by providing  that "such  appeal shall  be dealt with in the same manner  as if  it were an appeal under sub-s. (1) of s. 33". Two  things stand  out clearly or a fair reading of the two concerned  provisions, namely, sub-s. (2) (b) and sub-s. (4). The  bar of limitation contained in sub-s (2) (b) is on the Commissioner’s  power to  pass revisional  orders  under sub-s. (1)  and the same appears to be absolute in the sense that it  applies to every order to be made under sub-s. (1). At the  same  time  sub-s.  (4)  confers  on  the  Appellate Tribunal very wide powers which it has while dealing with an appeal  under  s.  33(1).  In  other  words,  the  Appellate Tribunal has power "to pass such orders thereon (i.e. on the appeal) as it thinks fit". In Hukumchand Mills(3), case this Court has  explained that  the word  "thereon" restricts the jurisdiction of the Appellate Tribunal to the subject-matter of the  appeal which  merely means  that the Tribunal cannot adjudicate or  give a  finding on a question which is not in dispute and  which does  not form  the subject-matter of the appeal but  the words "pass such orders thereon as it thinks fit" include  all the  powers (except  possibly the power of enhancement) which  are conferred on the Assistant Appellate Commissioner by  s. 31  and consequently  the  Tribunal  has authority in  exercise of  its appellate powers to set aside the order  appealed against  and direct  fresh assessment in the light of the observations made by it in its 276 judgment. In  other words, similar power is possessed by the Appellate Tribunal  while dealing with the appeal under sub- s.  (4)  of  s.  33B.  The  question  that  arises  for  our consideration is  whether such a direction to dispose of the case  afresh  can  be  given  to  the  Commissioner  by  the Appellate Tribunal  when the period of limitation prescribed under sub-s.  (2) (b)  has expired ? In other words, whether sub-s. (2)  (b) of  s. 33B  has the effect of attenuating or curtailing the appellate powers of the Tribunal under sub-s. (4) ?      Counsel for  the Revenue  contended that  it was a well settled principle that all the parts of a section or statute should be  construed together  and that  every clause  of  a section should  be construed  with reference  to the context and other clauses thereof, so that the construction put on a particular provision  makes a  consistent enactment  of  the whole  statute.   He  further   urged  that  the  object  of conferring revisional  power upon  the Commissioner under s. 33B(1) obviously  was to correct erroneous orders of Income- Tax Officer  in so  far as  they  were  prejudicial  to  the interests of  the revenue  and such object would be defeated if the  bar of limitation contained in sub-s. (2)(b) is held applicable to  revisional orders  passed by the Commissioner in pursuance  of or  in obedience  to a  direction given  or order made  by the  Appellate Tribunal  in appeal  under  s. 33B(4) or for that matter by the High Court or Supreme Court in case  the matter is carried to those Courts. According to him it  would be  proper to construe the provision in sub-s. 2(b) as  being applicable  to  suo  motu  revisional  orders passed by  the Commissioner  under sub-s.  (1)  and  not  to orders passed  by him  in pursuance of a direction issued to him by  the Tribunal  in appeal.  He urged that there was no reason why  sub-s. (2)  (b) should be regarded as having the

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effect of  attenuating or curtailing the very wide appellate powers conferred upon the Tribunal. He further urged that no argument could  be based  on the  absence  of  a  provision, similar to the 2nd proviso to s. 34(3), in s. 33B of the Act the support  of his contention strong reliance was placed by him upon  the Bombay High Court’s decision in Solanki’s case (supra).      On the  other hand,  counsel for the assessee canvassed the High  Court’s view  for our  acceptance by  pointing out that both ss. 33B and 34(3) together with the second proviso were introduced in the Act by the same Amending Act 1948 but in s.  33B no  provision for removing or relaxing the bar of limitation contained  in sub-s. (2)(b) was made and hence it was not  for the  Court to  supply a  casus omissus. He also relied on  the fact  that in  the  1961  Act  the  necessary provision has  been enacted  in s.  263(3) which also showed that in  the absence of such provision in s. 33B of the 1922 Act the bar of sub-s. (2) (b) was 277 applicable to  every order  of the Commissioner irrespective of whether  it was  made suo  motu  or  in  pursuance  of  a direction issued  by the  appellate authority.  According to him since  the bar of limitation contained in sub-s. (2) (b) of s. 33B always operated for the benefit of the assessee as the same  accorded finality  to the  assessment orders,  the appellate powers  of the  Tribunal under  sub-s. (4) must be regarded as  having been  curtailed to  the extent  that the Tribunal cannot  remand the  case to  the  Commissioner  for making fresh  assessment  if  by  then  the  limitation  has expired.      Two principles  of construction-one  relating to  casus omissus and  the other in regard to reading the statute as a whole-appear to be well settled. In regard to the former the following  statement   of  law   appears   in   Maxwell   on Interpretation of Statutes (12th Edn.) at page 33:           Omissions not to be inferred-"It is a corollary to      the general  rule of  literal construction that nothing      is to  be added to or taken from a statute unless there      are adequate  grounds to justify the inference that the      legislature intended  something  which  it  omitted  to      express. Lord  Mersey said:  ’It is  a strong  thing to      read into  an Act  of Parliament  words which  are  not      there, and  in the  absence of  clear necessity it is a      wrong thing  to do.’  ’We are not entitled,’ said Lords      Loreburn L.C., ’to read words into an Act of Parliament      unless clear  reason for  it is  to be found within the      four corners  of the  Act itself.’  A case not provided      for in a statute is not to be dealt with merely because      there seems  no good  reason why  it should  have  been      omitted, and  the omission  in consequence to have been      unintentional." In regard to the latter principle the following statement of law appears in Maxwell at page 47:           A statute  is  to  be  read  as  a  whole-"It  was      resolved in  the case  of Lincoln College [(1595) 3 Co.      Rep. 58b,  at p. 59b] that the good expositor of an Act      of Parliament  should ’make  construction  on  all  the      parts together,  and not  of one  part only by itself.’      Every clause  of a  statute is  to ’be  construed  with      reference to  the context and other clauses of the Act,      so as,  as  far  as  possible,  to  make  a  consistent      enactment of  the whole  statute.’ (Per  Lord Davey  in      Canada Sugar Refining Co., Ltd. v. R : 1898 AC 735)". 278 In other  words, under  the first  principle a casus omissus

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cannot be  supplied by the Court except in the case of clear necessity and  when reason  for it found in the four corners of the  statute itself  but at the same time a casus omissus should not  be readily inferred and for that purpose all the parts of a statute or section must be construed together and every clause of a section should be construed with reference to the  context  and  other  clauses  thereof  so  that  the construction to  be put  on a  particular provision  makes a consistent enactment  of the  whole statute.  This would  be more so if literal construction of a particular clause leads to manifestly  absurd or  anomalous results  which could not have been  intended by  the Legislature.  "An  intention  to produce an  unreasonable result",  said Danckwerts  L.J.  in Artemiou v.  Procopiou(1) "is not to be imputed to a statute if there  is some  other construction  available." Where  to apply words literally would "defeat the obvious intention of the legislation and produce a wholly unreasonable result" we must "do  some violence  to the  words" and  so achieve that obvious intention  and produce a rational construction, (Per Lord Reid  in Luke  v. I.R.C.-1968 AC 557 where at p. 577 he also observed:  "this is  not  a  new  problem,  though  our standard of  drafting is such that it rarely emerges. In the light of  these principles  we will  have to construe sub-s. (2) (b)  with reference  to the context and other clauses of s. 33B.      Section 33B  was introduced  in the  Indian  Income-Tax Act,  1922  by  the  Income  Tax  and  Business  Profit  Tax (Amendment) Act,  1948 with  effect from  March 30, 1948 and the object  of introducing  the same was obviously to confer revisional powers  upon  the  Commissioner  to  correct  the erroneous orders  of an Income Tax Officer in so far as they were prejudicial  to  the  interests  of  the  revenue.  The language of  the sub-sec. (1) clearly suggests that the said power was  contemplated to  be exercised  suo  motu  by  the Commissioner inasmuch  as the opening words show that it was upto the  Commissioner to call for and examine the record of any proceedings  under the  Act and  on examination  of  the record if  he were  satisfied that  any order  passed by  an Income Tax Officer was erroneous as being prejudicial to the interests of  the revenue  he could  revise the  same  after giving an  opportunity to the assessee of being heard. It is true that  sub-s. (2)  (b) thereof  prescribed a  period  of limitation on  his power by providing that no order shall be made under sub-s. (1) after the expiry of two years from the date of  the order  sought to be revised by the Commissioner and a  literal construction  of sub-s. (2) (b) also suggests that the  bar of  limitation imposed thereby was absolute in the sense  that it applied to every kind of order to be made under sub-s. (1) and no distinction was made between a 279 suo motu  order and  an order  that might  be  made  by  him pursuant to  a direction  given by  any appellate  or  other higher authority  but the question is whether such a literal construction should  be accorded  to  that  provision  ?  As stated earlier  sub-s. (3)  conferred on an assessee a right to prefer  an appeal  to the  Appellate Tribunal against the Commissioner’s order  made under sub-s. (1) and under sub-s. (4) the  Tribunal had  authority to  deal with  the impugned order of the Commissioner in such manner as it deemed fit in exercise of  its appellate  powers; for  instance, it  could confirm the  impugned order,  it could  annul that order, it could  after  vacating  it  remand  the  case  back  to  the Commissioner for  making a  fresh assessment in the light of the observations  made by  it in  its judgment  or it could, after calling  for a  remand report,  rectify the  erroneous

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order of the Income Tax Officer. Further there was no period prescribed within which an appeal against the impugned order of The  Commissioner had  to be  disposed of by the Tribunal and in  the normal  course on  rare occasions  such  appeals would have  been heard  and disposed of before the expiry of two years  from the  date of  the Income Tax Officer’s order which was  regarded as  erroneous by  the Commissioner. More often than  not such appeals would come up for hearing after the expiry  of the  said period  of two  years-a fact  fully known and  within the  contemplation of the Legislature when it introduced  the section  in the  Act in  1948.  In  these circumstances did  the Legislature  intend to  attenuate  or curtail the  appellate powers  which  it  conferred  on  the Appellate Tribunal  in very  wide terms  under sub-s. (4) by enacting sub-s.  (2) (b)  prescribing a  time limit  on  the Commissioner’s power  to revise  an erroneous  order of  the Income Tax  Officer when  the  Commissioner-was  seeking  to exercise the  same not  suo motu  but  in  pursuance  of  or obedience to  a direction  from the  Appellate  authority  ? According to  the construction contended for by the assesses and which found favour with the High Court the answer was in the affirmative  because sub-s.  (2)  (b),  on  its  literal construction,  was   absolute.  In  our  view  such  literal construction would  lead to  a  manifest  y  absurd  result, because in  a given  case, like  the present  one, where the appellate authority  (Tribunal) has found (a) the Income Tax Officer’s order to be clearly erroneous as being prejudicial to the  interests of  the revenue and (b) the Commissioner’s order unsustainable  as being  in violation of principles of natural justice  how should the appellate authority exercise its appellate  powers ?  obviously it could not withhold its hands and  refuse to  interfere  with  Commissioner’s  order altogether  for,  that  would  amount  to  perpetuating  the Commissioner’s erroneous  order, nor  could it merely cancel or set  aside the  Commissioner’s wrong  order without doing anything about  the Income  Tax Officer’s  order, for.  that would result in perpetuating the Income Tax 280 Officer’s order  which  had  been  found  to  be  manifestly erroneous as  being prejudicial  to the  revenue.  But  such result would  flow from  the view  taken by  the High  Court which has  held that the Tribunal acted properly in vacating the  Commissioner’s  order  but  did  not  act  properly  in directing him  to dispose  of the  proceedings afresh  after giving opportunity  to the  assesses. Such manifestly absurd result could  never have  been intended  by the Legislature. Moreover, it  was fairly  conceded by  the counsel  for  the assesses before  us that in exercise of its appellate powers it was  open to  the Tribunal  itself to  call for  a remand report from  either  the  Commissioner  or  the  Income  Tax Officer and rectify the Income Tax Officer’s erroneous order after giving  opportunity to the assesses and in doing so no question of limitation would arise. It was also not disputed by him that it was equally open to the Tribunal to set aside the Commissioner’s order and remand the case directly to the Income Tax Officer giving the requisite direction to rectify his erroneous  order and  thereupon the  Income Tax  Officer could carry  out the  Tribunal’s direction. for, admittedly, the bar  of limitation  under 1)  sub-s. (2) (b) was only on the Commissioner’s  paver to  make an  assessment afresh and not on  the Income  Tax Officer.  If  this  be  the  correct position then  it is  gravely anomalous  that  the  Tribunal should not  be in a position to set aside the Commissioner’s order and  remand the  case back  to  the  Commissioner  for making a fresh assessment because in the meantime two years’

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period of  limitation has  expired, for,  it would mean that the Tribunal was prevented from achieving the desired effect directly  through  the  Commissioner  but  it  could  do  so indirectly  through   the  Income  Tax  Officer.  A  literal construction placed  on subs.  (2) (b)  would lead  to  such manifestly absurd  and anomalous  results, which,  we do not think,   were    intended   by    the   Legislature.   These considerations compel  us to  construe the  words of sub-s.. (2)(b) as  being  applicable  to  suo  motu  orders  of  the Commissioner in  revision and  not to  orders  made  by  him pursuant to  a direction  or order  passed by  the Appellate Tribunal under  sub-s. (4) or by any other higher authority. Such construction  will be  in consonance with the principle that all  parts of  the section should be construed together and every  clause thereof should be construed with reference to the  context  and  other  clauses  thereof  so  that  the construction  put  on  that  particular  provision  makes  a consistent enactment of the whole statute.      Having regard to the above discussion we are clearly of opinion that  the view  taken by  the Bombay  High Court  in Solanki’s case (supra) on the construction of sub-s. (2) (b) of s.  33B is  correct and we approve of it. In Sabitri Devi Agrawalla’s  case  (supra)  the  Assam  High  Court  took  a contrary view and held that under s. 33B(4) of the 281 Act the  Tribunal would  not be  justified in  remanding the case to  the   Commissioner after  the two years had expired from the  date of  the  order  sought  to  be  revised.  The decision seems to rest on three aspects: (a) it being fiscal statute the  same must be strictly construed, (b) the bar of limitation contained  in  sub-s.  (2)(b)  was  absolute  and unqualified and  covered all  types of  orders and  (c) that unlike the second proviso to s. 34(3) there was no provision for removing  or relaxing the bar of limitation on the power of the  Commissioner under  s. 33B (2) (b) and that since s. 33B as  well as  s.  34(3)  with  second  proviso  had  been introduced in the Act by the same Amending Act of 1948 there was a  deliberate omission  to make  a provision removing of relaxing the  ’oar of  limitation in  s. 33B and for such an omission the  remedy lay  with the  Legislature and not with the Court.  The Assam  High Court  also alluded  to the fact that under the 1961 Act the Legislature had made a provision removing or  relaxing the bar of limitation in s. 263(3). As regards aspect  (b) we  have already dealt with it above. As regards aspect  (a) it  is well  settled that  the principle that the  fiscal statute  should be  construed  strictly  is applicable only  to taxing  provisions such  as  a  charging provision or  a provision  imposing penalty and not to those parts of  the statute which contain machinery provisions and by no  stretch could  s.  33B  be  regarded  as  a  charging provision. As regards aspect (c) we have already pointed out above that  a casus  omissus has  not to be readily inferred and it  could not  be inferred  from the mere fact that both ss. 33B  and 34(3)  together with  the second  proviso  were inserted simultaneously  in the Act by the same Amending Act of 1948  and that in the case of former a relaxing provision was not  made  as  was  made  in  the  case  of  the  latter provision, firstly  because the  two provisions  operated in distinct fields  and secondly  it would be improper to do so without comparing  the various  stages of amendments through which each  set of  these  provisions  had  undergone  since inception. The  further aspect  that the  Legislature has in the 1961  Act  made  the  requisite  provision  removing  or relaxing the  bar of  limitation in  s. 263(3),  is, in  our view, not  of much consequence. Irrespective of the question

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whether the second proviso to s. 34(3) was enacted ex majore cautella or not (over which conflicting views obtain), it is clear to  us that s. 263(3) of the 1961 Act must be regarded as an  ex majore cautella provision. Admittedly, at the time when the  said provision  was enacted  in the  1961 Act, the Bombay view held the field and, there was no decision to the contrary of  any other High Court. Obviously, therefore, the enactment of  s. 263(3)  must be  regarded as declaratory of the law  which was  already prevailing and this position has been clarified  in the  Notes on  Clauses of  the Income Tax Bill 1961  where it  has been  stated that sub-cl. (3) of s. 263 was new and had been 19 282 added to  get over  the difficulty  experienced in  (wrongly state ’caused  by’) the  Bombay High  Court’s;  decision  in Solanki’s case  (supra) .  The enactment  of  an  ex  majore cautella provision  in the  1961 Act  would, therefore, be a legislative recognition  of the legal position that obtained as a  result of  judicial pronouncement qua the 1922 Act. In our view, therefore. the Assam case was wrongly decided.      Reference may  now be  made to a decision of this Court in Pooran  Mall’s case, where in a similar situation arising under s.  132 of  the Income  Tax Act,  1961,  a  restricted construction was  accorded  by  this  Court  to  sub-s.  (5) thereof which  prescribed certain  period of  limitation. In that case  pursuant to  an  authorisation  issued  under  s. 132(1) of  the 1961 Act searches were carried out on October 15 and 16, 1971 at the residence and business premises of P, an individual,  and at  certain office premises of the firms in which  he was  a partner, and jewellery, cash and account books were  seized. There was also a search of two banks and a restraint  order was  made under s. 132(3) in respect of l 14 silver  bars pledged  with those banks on the ground that they were the property of P. On January 12, 1972, the Income Tax Officer  passed a  summary order  under s. 132(5) on the basis that  all  the  assets  seized  and  114  silver  bars belonged to  P. Thereupon,  P &  Sons, one  of the  firms in which P  was a  partner, and  P filed a writ petition in the High Court  challenging the order dated January 12, 1972 and on April  6, 1977,  on the  basis  of  the  consent  of  the parties, the  High Court quashed the order and permitted the department  to   make  a   fresh  enquiry  after  giving  an opportunity to  the petitioner and pass a fresh order within two months.  After a  fresh enquiry  the Income  Tax Officer passed an  order on  June S,  1972. holding  that the silver bars belonged  to P, the individual, and not the firm, P and Sons. Thereupon,  the firm and P again filed a writ petition challenging the  second order.  The High Court held that the Income Tax  Officer had  no jurisdiction  to pass that order beyond the  period prescribed in s. 132(5) and set aside the order and  directed the  return of  the 114  bars of silver. This  Court  held,  inter  alia,  that  the  order  made  in pursuance of  a direction given - ’ under s. 132(12) or by a Court in writ proceedings, was not subject to the limitation prescribed under  s. 132(5).  At page  394  this  Court  has observed thus:           "Even if  the period  of time  fixed under section      132(5) is  held to be mandatory that was satisfied when      the first  order was made. Thereafter, if any direction      is given  under section  132(2) or  by a  Court in writ      proceedings, as  in this case, we do not think an order      made in pursuance of such a 283      direction  would   be  subject   to   the   limitations      prescribed under A section 132 (5) . Once the order has

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    been made  within ninety  days the aggrieved person has      got the  right to approach the notified authority under      section 132(11)  within thirty  days and that authority      can direct  the Income  Tax Officer  to  pass  a  fresh      order. We cannot accept the contention on behalf of the      respondents that  even such  a fresh  order  should  be      passed within  ninety days.  It  would  make  the  sub-      sections (11)  and (12)  of section  132 ridiculous and      useless." It may  be pointed  out that in s. 132 there is no provision removing or  relaxing the  bar of limitation contained in s. 132(5) enabling  the Income  Tax Officer  to pass  an  order afresh pursuant  to any  direction issued to him by a higher authority under  s. 132(12) and even the this Court took the view that  the limitation prescribed under s. 132(5) will be applicable only  to the  initial order  to be  made  by  the Income Tax Officer and not to an order that would be made by him pursuant  to a  direction from  the  Board  or  notified authority. The  concerned provisions  were read together and such construction  was put on sub-s. (5) of s. 132 as made a consistent enactment of the whole statute.      In the  result, we are of opinion that the answer given by the  High Court  to  the  second  aspect  of  the  second question referred  to it was clearly wrong and, in our view, the Tribunal’s  order vacating  the Commissioner’s order and directing the  Commissioner to  make assessment afresh after giving  due   opportunity  to  the  respondent-assessee  was proper.  The  appeal  is  accordingly  allowed  but  in  the circumstances, there will be no order as to costs. V.D.K.    Appeal allowed. 284