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PETITIONER: KUNWAR TRIVIKRAM NARAIN SINGH

       Vs.

RESPONDENT: STATE OF UTTAR PRADESH AND OTHERS

DATE OF JUDGMENT: 25/09/1964

BENCH: SUBBARAO, K. BENCH: SUBBARAO, K. SHAH, J.C. SIKRI, S.M.

CITATION:  1965 AIR 1267            1965 SCR  (1) 336

ACT:     Agricultural  Income-tax-Assessment  made  by  Assistant Collector  quashed  for want  of  jurisdiction-Retrospective amendment  of  law  conferring  jurisdiction  on   Assistant Collectors-Fresh  assessment whether barred  by  limitation- U.P.  Agricultural  Income-tax  Act, 1948, (U.P.  Act  3  of 1949), as amended by U.P. Act 14 of 1956.

HEADNOTE:   The  appellant was assessed to agricultural income-tax  by the Assistant Collector, Banaras, U.P. Act 3 of 1949,  under which  assessment was made, mentioned only  the  ’Collector’ a.,,  competent to make assessment.  The assessment made  by the  Assistant  Collector  was therefore set  aside  by  the Collector.  Subsequently the law was amended by U.P. Act  14 of  1956 to provide that the word ’Collector’ would  include ’Assistant  Collector’ and that the Collector  could  review his  earlier  orders quashing assessments on the  ground  of want of jurisdiction, if application for review were made to him by any of the parties within 90 days of the coming  into force of the amendment.  Such application having been  filed in the appellant’s case, the Collector set aside his earlier orders quashing the assessment, and the Assistant  Collector made   a  fresh  assessment.   The  fresh   assessment   was challenged  by  the appellant by writ petition in  the  High Court  and  having failed there, The appellant came  to  the Supreme Court by special leave. It  was  contended  on  behalf of  the  appellant  that  the assessment made by virtue of the provisions of the  amending Act  was  barred  by limitation  because  the  retrospective operation  of the provisions relating to jurisdiction  would not extend the time for making the assessment. HELD  : The Collector’s order on the review application  had the  effect  of  restoring  the  earlier  proceedings.    No question  of  limitation  could possibly  arise,  for  those proceedings  were  initiated in time and must be  deemed  to have  been pending throughout, and the fresh assessment  was made in those very proceedings. [339 A-B]. S.   C.  Prashar  v. Vasantsen, A.I.R. 1963 S. C.  1356  and Commissioner  of Income-tax, Bihar v. Lakhmir Singh,  A.I.R. 1963 S. C. 1394, held inapplicable.

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JUDGMENT:    CIVIL  APPELLATE  JURISDICTION: Civil Appeal No.  799  of 1963. Appeal  by special leave from the judgment and decree  dated March 1, 1961 of the Allahabad High Court in Special  Appeal No. 205 of 1958. S.   P. Varmaa for the appellant. C.   B.  Agarwala,  O. P. Rana and Atiqur  Rehman,  for  the respondents.                             337 The Judgment of the Court was delivered by Subba  Rao J. This appeal by special leave raises the  ques- tion of the scope of the retrospective operation of the U.P. Agricultural Income-tax (Amendment) Act, 1956 (U.P. Act  No. 14 of 1956). The facts are simple and they are as follows: On January 10, 1953,  for  the  assessment  year  1952-53,  the  Additional Collector,  Banaras, assessed the appellant to  agricultural income-tax under the U.P. Agricultural Income-tax Act,  1948 (U.P.   Act  3  of  1949).   On  February  9,   1956,   U.P. Agricultural  Income-tax (Amendment) Ordinance, 1956  (2  of 1956)  was passed enacting that the word  "Collector"  shall always  be  deemed to include  Additional  Collector.   That Ordinance  was  later  replaced  by  the  U.P.  Agricultural Income-tax  (Amendment) Act 14 of 1956.  On  an  application filed by the appellant, the Collector by his order dated May 9,  1956,  revoked  his  earlier  order  and  directed   the Additional  Collector to proceed to assess the appellant  in accordance  with law.  Thereupon, the  Additional  Collector resumed  proceedings  and on June 7, 1956,  passed  a  fresh assessment  order  imposing  a  tax of  Rs.  42,761  on  the appellant,  and on July 4, 1956, he issued a notice  to  the appellant  for payment of the tax.  On August 7,  1956,  the appellant   filed   a  petition  under  Art.  226   of   the Constitution  in the High Court of Judicature  at  Allahabad for  quashing the order of assessment and the notice  issued pursuant  thereto.   The petition was heard,  in  the  first instance,  by Tandon J., who dismissed the same with  costs. The appeal preferred by the appellant against that order  to a  Division  Bench was also dismissed.   Hence  the  present appeal. Mr. S. P. Varma, learned counsel for the appellant contended that  (i) the respondent’s right to assess the appellant  to tax  was barred by limitation and, therefore, the Act  could not have the effect of reviving the said right; and (ii) the amount  of malikhana could not be in law the  subject-matter of assessment. The  second point was not raised in the High Court.  We  did not  permit the learned counsel to raise the point  for  the first time before us. The first point turns upon the relevant provisions of Act  3 of 1.949 and Act 14 of 1956.  Under Act 3 of 1949 the  defi- nition   of   "Collector"  did   not   include   "Additional Collector".   Act  14  of 1956 received the  assent  of  the Governor  on April 17, 1956, and was published in  the  U.P. Gazette (Extraordinary) 338 dated May 19, 1956.  Section 2 of Act 14 of 1956 reads: "In section 2 of the U.P. Agricultural Income Tax Act,  1948 (hereinafter called the Principal Act), for clause (4),  the following  shall  be  and  be deemed  always  to  have  been substituted-

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             "(4-a)  ’Collector’ shall have the meaning  as               in  the U.P. Land Revenue Act, 1901, and  will               include  an  Additional  Collector   appointed               under the said Act."               Section 11 of the Act reads               "Where before the commencement of this Act any               Court  or  authority has, in  any  proceedings               under   the  Principal  Act,  set  aside   any               assessment made by an Additional Collector  or               Additional  Assistant Collector incharge of  a               sub-division  merely  on the ground  that  the               assessing  authority  had no  jurisdiction  to               make   the  assessment,  any  party   to   the               proceedings  may,  at any time  within  ninety               days from the date of commencement of this Act               apply  to the Court or authority for a  review               of  the  proceedings  in  the  light  of   the               provisions  of  this  Act, and  the  Court  or               authority  to  which the application  is  made               shall  review the proceedings accordingly  and               make  such order, if any, varying or  revising               the order previously made, as may be necessary               to  give  effect  to  the  provisions  of  the               Principal  Act as amended by sections 2 and  8               of this Act." A  combined reading of the said provisions establishes  that if  an  application  for review was filed  within  the  time prescribed,  the previous proceedings would be restored  and the  parties would be relegated to the position  which  they had  occupied  before the proceedings were  quashed  on  the ground of want of jurisdiction. In  this case proceedings were initiated by  the  Additional Collector on January 10, 1953, for the purpose of  assessing the appellant for the assessment year 1952-53.  There was no flaw  in  the said proceedings except  that  the  Additional Collector  was not authorized by Act 3 of 1949, as  it  then stood, to make the said assessment.  The, Collector  quashed those  proceedings  by his order dated  November  26,  1955. After the amending Act was passed, within 90 days  therefrom the   appropriate   income-tax  authority   had   filed   an application  before the Collector to review his order.   The Collector reviewed the order and                             339 set  aside  the same.  The result was that  the  proceedings before  the Additional Collector were restored.  As  by  the amendment  the Additional Collector must be deemed  to  have been  the Collector from the inception of the Principal  Act itself,  the  said proceedings must be deemed to  have  been initiated  before the proper authority -under the  Principal Act.  In this view no question of limitation could  possibly arise,  for the proceedings were initiated in time and  must be  deemed  to have been pending throughout  and  the  fresh assessment was made in the said proceedings. The decisions cited by the learned counsel are really beside the mark.  He relied upon the judgments of this Court in  S. C.  Prashar v. Vasantsen(1), and Commissioner of  Income-tax Bihar  v. Lakhmir Singh(2).  One of the questions raised  in those  cases  was whether an amending Act revived  a  remedy which had become barred before the amendment was introduced. That aspect of the question has no relevance to the  present enquiry.    Here   we  are  dealing  with   an   Act   whose constitutionality  is  not  questioned.   It  has  expressly conferred  power on the appropriate authority to review  its previous  order if an application was filed within the  time prescribed.   When once that power of review was  exercised,

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the proceedings were reopened.  In this view, no question of the  application of an amending Act to a barred claim  would arise. In  the result we hold that the order of the High  Court  is correct and dismiss the appeal with costs. Appeal dismissed.. (1)  [1964] 1 S.C.R. 29. (2)  [1964] 1 S.C.R. 148. 340