1961 (8) TMI 65 - HC - Income Tax

Allahabad High Court upholds agricultural Income Tax recovery proceedings, dismisses writ petition

Lal Bhan Pratap Narain Bahadur Pal Versus State of Uttar Pradesh and Ors.

Lal Bhan Pratap Narain Bahadur Pal Versus State of Uttar Pradesh and Ors. - [1962] 46 ITR 247 (All) Issues:Challenge to recovery proceedings in agricultural Income Tax assessment for Fasli year 1360 based on limitation under Article 226 of the Constitution of India.Analysis:The petitioner contested the recovery proceedings for agricultural Income Tax and penalty amounting to Rs. 543-II-0, arguing that the assessment order was passed on January 31, 1954. The petitioner claimed that the recovery notice was issued on July 12, 1956, which was beyond the limitation period. However, the court found discrepancies in the date mentioned on the notice and determined that the recovery proceedings did not commence on July 12, 1956.The U.P. Agricultural Income Tax Act empowers the Collector to recover tax arrears as land revenue on the motion of the assessing authority. The limitation for recovery proceedings is one year from the date the last installment falls due. The petitioner contended that the recovery notice issued on July 12, 1956, exceeded this limitation period. However, the court clarified that the proceedings commence when the assessing authority requests the Collector to initiate recovery, not when the notice is issued.The court compared the language of the U.P. Agricultural Income Tax Act with the Income Tax Act and established that the commencement of recovery proceedings is akin to the date of the request made by the assessing authority to the Collector. Drawing parallels with previous judgments, the court emphasized that the recovery proceedings were initiated within the one-year limitation period as mandated by the law.Moreover, the court highlighted the applicability of the U.P. Zamindari Abolition and Land Reforms Act in the recovery process, indicating that the procedure for realizing agricultural Income Tax dues aligns with the arrears of land revenue recovery process. The notice issued by the Tahsildar was deemed a writ of demand under the Act, but it did not signify the commencement of recovery proceedings, which begin with the request from the assessing authority to the Collector.In conclusion, the court dismissed the writ petition, ruling that the recovery proceedings were valid and within the prescribed timeframe, rejecting the petitioner's claims and ordering costs to be paid.Judgment:The writ petition challenging the recovery proceedings in agricultural Income Tax assessment for the Fasli year 1360 based on the limitation under Article 226 of the Constitution of India was dismissed by the High Court of Allahabad.