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of <h1>High Court quashes tax assessment due to jurisdictional issue caused by delay in revisional powers.</h1> <h3>Teekoy Rubbers (India) Limited Versus Commissioner Of Agricultural Income-Tax</h3> Teekoy Rubbers (India) Limited Versus Commissioner Of Agricultural Income-Tax - [1996] 219 ITR 615, 134 CTR 433 Issues:Challenge to order rejecting application against Deputy Commissioner's exercise of revisional powers under section 34 of the Act after a significant delay.Analysis:The High Court of Kerala heard revision cases challenging the exercise of revisional powers by the Deputy Commissioner under section 34 of the Agricultural Income-tax Act after a substantial delay. The court noted that one case did not require separate consideration as it was covered by another case. The main issue was whether the delay in passing the revision orders created a bar of limitation. The court referred to a previous judgment where it was established that the exercise of suo motu revisional powers must be done within a reasonable time supported by a valid explanation for any delay due to insurmountable difficulties beyond control.The cases involved challenges to the orders of the Commissioner of Agricultural Income-tax rejecting applications against the Deputy Commissioner's exercise of revisional powers. The assessment years in question were 1980-81, 1981-82, and 1982-83. The suo motu powers were exercised based on notices served in March 1991 and subsequent orders passed in May and December 1991. The court observed that the dates and circumstances in all these cases were almost identical, leading to the argument that the delay in initiating the revisional powers after nearly eight years created a jurisdictional issue due to the bar of limitation.The court emphasized that there was no material on record to justify the significant delay in initiating the proceedings under section 34 of the Act. It highlighted the importance of the Department providing valid reasons for such delays to satisfy the court's conscience. Without a valid explanation, the initiation of proceedings based on whims and caprices was deemed lacking in jurisdiction. The court concluded that the lack of jurisdiction due to the delay rendered other questions unnecessary to consider, as it was a fundamental issue affecting the root of the matter.Therefore, the High Court held that the initiation of actions for the assessment years 1980-81, 1981-82, and 1982-83 based on notices from March 1991 should be quashed and set aside. The revision cases were allowed accordingly, emphasizing the importance of adhering to reasonable timelines and providing valid justifications for delays in exercising revisional powers under the Act.
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