1967 (8) TMI 30

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.... Act, the Agricultural Income-tax Officer initiated proceedings under section 35 and revised the assessment. The respondent's appeal failed but in his further appeal, the Tribunal took the view that this was not a case of income that had escaped assessment or had been assessed at too low a rate. At the instance of the revenue the following question has been referred to us. " Whether an improper allowance of rebate of insurance premium can be revoked by resort to section 35 of the Travancore-Cochin Agricultural Income-tax Act, 1950 ? " Before we proceed to consider this question, we may add that the Tribunal's reason was that, in order to invoke section 35, there should be a change in the quantum of income as originally determined, by ....

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....icultural Income-tax Act, 1950, is concerned, it is covered by the decision of the Supreme Court in Kameshwar Singh v. State of Bihar Section 35 of the Kerala Agricultural Income-tax Act, 1950, reads : " Income escaping assessment.--If for any reason agricultural income chargeable to tax under this Act has escaped assessment in any financial year or has been assessed at too low a rate, the Agricultural income-tax Officer may, at any time within three years, of the end of that year serve on the person liable to pay the tax or in the case of a company on the principal officer thereof, a notice containing all or any of the requirement which may be included in a notice under sub-section (2) of section 17 and may proceed to assess or reassess....

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....after went up to the Supreme Court by special leave. Hidayatullah J., who spoke for the court, held at page 1309 : "........ we are of opinion that the Agricultural Income-tax Officer competent under section 26 of the Act to assets an item of income which he had omitted to tax earlier, even though in the return that income was included and the Agricultural Income-tax Officer then thought that it was exempt. " On that view the appeal was dismissed. In the course of the judgment reference was made to section 34 of the Income-tax Act as it originally stood before the several amendments it went through and to the divergence of opinion as to the scope and ambit of the power under that provision, and the opinion was expressed that the words....