1980 (12) TMI 45 - HC - Income Tax

Court Invalidates Delayed Revisional Order for Agricultural Income Tax Assessments

Deputy Commissioner Of Agricultural Income-Tax And Sales Tax, Central Zone Versus PSB. Paul Pandian

The court invalidated the revisional order for agricultural income-tax assessments for 1967-68 and 1968-69 due to unreasonable delays of 11 and 10 years, ... Agricultural Income Tax, Limitation Issues involved: Assessment of agricultural income-tax for the years 1967-68, 1968-69, and 1969-70 based on estimated yield from cardamom plantation; Validity of revisional order u/s 34 of the Kerala Agricultural I.T. Act, 1950; Limitation period for exercising revisional jurisdiction.Assessment of Agricultural Income-tax: The assessing authority estimated the income from ten acres of cardamom plantation for the relevant years at 10 Kgs. per acre for 1967-68 and at 12 Kgs. per acre for 1968-69 and 1969-70 based on a spot inspection report from August 1, 1965. The Dy. Commr. of Agrl. I.T. found this estimation improper as it related to accounting years 1964-65 and 1965-66. He noted a yield of 30 Kgs. per acre from a drought-affected area in 1963-64. In a suo motu revision u/s 34 of the Act, he directed a fresh assessment according to law due to irregularity in the yield estimation.Validity of Revisional Order: The Dy. Commr. exercised revisional jurisdiction u/s 34 of the Act on August 31, 1978, after completion of assessments in 1967-68, 1968-69, and 1969-70. The question of whether the revision was time-barred was raised. The assessee contended that the delay of about 11 years in one case and 10 years in another was unreasonable, citing a court decision emphasizing reasonableness in exercising such jurisdiction. The Government pleader argued that no specific limitation period was prescribed for revisional jurisdiction.Limitation Period for Revisional Jurisdiction: The court considered the absence of a prescribed time-limit in s. 34 of the Act for exercising revisional power. While acknowledging the lack of a specific limitation, the court emphasized the need for reasonableness in avoiding prejudice to the assessee. It noted an unjustifiable delay of 11 years in one case and 10 years in another between assessment completion and revision, deeming it unacceptable. The court held the revisional order invalid for the years 1967-68 and 1968-69 due to the prolonged delay but upheld it for the year 1969-70, directing parties to bear their respective costs.