Changed agricultural income option can be validly exercised in a later return after amendment, subject to statutory filing requirements.

Amendments to the agricultural income scheme removed the earlier restriction on varying the assessee's chosen method of computation, so a declaration filed with a valid later return could change the option first indicated. A return submitted in response to notice under section 15(3) was treated as a fresh, timely return, and earlier participation in the proceedings did not amount to waiver of the right to alter the option. The best judgment power under section 16(4) did not nullify that right; it required due regard to the prescribed provisional estimate, but not rigid adherence to the earlier option.

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Issues: (i) Whether an assessee who had once indicated an option for the method of computation of agricultural income could change that option by filing a later return or declaration under the amended Act and Rules; (ii) whether the return filed in response to notice under section 15(3) could validly carry a fresh option despite earlier returns and declarations; (iii) whether a best judgment assessment under section 16(4) could disregard the assessee's changed option.

Issue (i): Whether an assessee who had once indicated an option for the method of computation of agricultural income could change that option by filing a later return or declaration under the amended Act and Rules.

Analysis: The original restriction on varying the method of computation stood removed by amendment. The word "first" was deleted from rule 5, and the earlier proviso to section 6(1), which had confined variation of the option, was omitted. The amended scheme required only that a declaration indicating the option be filed along with the return of income. In that setting, the phrase "his return of income" was held to cover the returns contemplated under section 15, and the assessee was not bound irrevocably by the option first indicated.

Conclusion: The assessee was entitled to change the option by filing a later valid return with the accompanying declaration.

Issue (ii): Whether the return filed in response to notice under section 15(3) could validly carry a fresh option despite earlier returns and declarations.

Analysis: The return filed on 8 November 1958 was shown by the accompanying forwarding letter to have been submitted in response to the notice under section 15(3). It was treated by the assessing authority as being within time and was rejected on the merits, not for delay. It was therefore a fresh return under section 15(3), not a revised return under section 15(4). Since the filing was valid, the assessee could annex a declaration changing the option. Earlier participation in the proceedings and production of evidence did not amount to waiver or acquiescence of that right.

Conclusion: The return under section 15(3) validly carried the changed option, and the assessee was not barred from exercising it.

Issue (iii): Whether a best judgment assessment under section 16(4) could disregard the assessee's changed option.

Analysis: Section 16(4) directs the assessing authority, while making a best judgment assessment, to act with due regard to the provisional estimate sent under section 15(3-B), notwithstanding any option exercised under section 6(1). The provision was construed to mean that the assessing authority is not rigidly controlled by the assessee's option and may adopt an appropriate basis for arriving at the true agricultural income, but must still have due regard to the provisional estimate prepared under section 6(2)(a). That scheme did not defeat the assessee's entitlement to change the option in a valid return under the regular assessment provisions.

Conclusion: Section 16(4) did not prevent the assessee from changing the option in a valid return, and the assessment had to be made in accordance with the changed option under section 6(2)(a).

Final Conclusion: The assessee's later return was validly filed in response to the statutory notice, the changed option was effective, and the assessment made on the contrary basis could not stand.

Ratio Decidendi: Where amended tax provisions remove the restriction on varying an option and the rules require the declaration to accompany any valid return, an assessee may change the method of computation by filing a proper later return before assessment is completed; a best judgment provision does not nullify that right, though it permits the authority to act with due regard to the prescribed provisional estimate.

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