Limitation on recovery under agricultural income-tax: proceedings time-barred for one assessment year, timely for others.

Whether recovery proceedings under the U.P. Agricultural Income-tax Act were within the one-year limitation of section 32 was decided by treating recovery as an arrear of land revenue and construing sections fixing instalment dates in pari materia with the Income-tax Act. Documentary and register evidence established that realization orders for assessment years 1360 F., 1361 F. and 1362 F. were issued within one year of the last instalment, so proceedings were timely; the order relied on for 1363 F. post-dated the limitation period and recovery was time-barred. Appeals dismissed.

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Issues: Whether proceedings for recovery of agricultural income-tax and penalties under the U.P. Agricultural Income-tax Act, 1949, commenced within the one-year period prescribed by section 32 for the assessment years 1360 F., 1361 F., 1362 F. and 1363 F.

Analysis: The Court analysed section 30 (fixing instalment dates) and section 32 (treating recovery as if an arrear of land revenue and prescribing a one-year limitation from the date the last instalment falls due). It compared these provisions with section 46 of the Indian Income-tax Act, 1922, and held them to be in pari materia. The Court accepted the Division Bench's admission of additional documentary evidence showing that, for years 1360 F. and 1361 F., the assessing authority made formal orders directing the Collector/Tahsildar to realize the demands (annexures A-1 to A-5) on dates within one year of the last instalment (between October 9, 1960 and December 2, 1960). For 1362 F. the Court accepted the High Court's factual finding based on demand and collection registers that an order for realization was received by the Tahsildar in July or August 1960, within one year of the last instalment. For 1363 F. the Court found that the order relied upon was dated October 1, 1959, which was beyond one year from the last instalment (September 19, 1958), and therefore recovery proceedings for 1363 F. were time-barred. The Court declined to interfere with the High Court's factual findings on the evidence presented.

Conclusion: Proceedings for recovery were commenced within time for assessment years 1360 F., 1361 F. and 1362 F.; proceedings for recovery were time-barred for assessment year 1363 F. The appeals filed by the assessee and by the departmental authorities are dismissed.

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