SISIR KUMAR SEN, J. -
(1.) THIS revisional application under Art. 227 of the Constitution is directed against an order passed in revision by the Board of Revenue, West Bengal, reviving Certificate Case No. 300 IT of 1948-49 against M/s H. and A.K. Ganguli, represented by the petitioner, Ajit Kumar Ganguli and his partners. The petitioner, Ajit Kumar Ganguli, was a partner of the firm styled "M/s H. and A.K. Ganguli" which had its office at 17/19 R.G. Kar Road, Calcutta. According to the petitioner, the said partnership firm discontinued business w.e.f. 8th Aug., 1942, the assets and liabilities of the firm, with the right to use the firm name "M/s H. and A.K. Ganguli" in respect of existing tenders and contracts being taken over by M/s Ganguli and Sons Ltd., having its office at No. 17, R.G. Kar Road. On 23rd March, 1948, the ITO District I(2), Calcutta, assessed the income of the firm "M/s H. and A.K. Ganguli" for the asst. yr. 1943-44 Rs. 1,62,000 and by a notice under s. 29 of the IT Act, dt. 5th April, 1948, demanded Rs. 83,111-15-0 on account of income-tax and surcharge and super-tax and surcharge for the said year, the demand being payable by 30th April, 1948. Further, the ITO by an order dt. 30th June, 1948, imposed under s. 28(1)(b) of the IT Act a penalty of Rs. 81,527-10-0 on the firm, and served a notice of demand under s. 29 of the Act, dt. 9th July, 1948, making the amount payable by 25th July, 1948. Neither of the two amounts demanded having been paid, the ITO on 4th Feb., 1949, signed and forwarded a certificate under s. 46(2) of the IT Act to the Collector, 24-Parganas, and Certificate Case No. 300 IT of 1948-49 was started thereon, for recovery of the sum of Rs. 1,64,639-9-0, representing the sum of the two demands; the certificate under s. 4 of the Public Demands Recovery Act being filed on 10th Feb., 1949, and notice under s. 7 of the Act being issued on the same date.
(2.) THE petitioner in the meantime appealed against the assessment of tax and imposition of penalty on the defunct firm, M/s H. and A.K. Ganguli, but the appeal was dismissed by an order dt. 30th May, 1949. THE petitioner filed a second appeal before the Tribunal, Calcutta, and the Tribunal by its order dt. 28th Feb., 1950, modified the order of the ITO determining the income of the firm at Rs. 1,13,750 and reducing the demand on account of income-tax with surcharge and super-tax with surcharge to Rs. 51,666-11-0 and the penalty to Rs. 50,100. THE partners of the defunct firm paid Rs. 10,000 towards the tax demand on 29th March, 1950, to the Income-tax office. THEreafter, a fresh notice of demand under s. 29 of the IT Act dt. 28th April, 1950, was issued on the defunct firm, requiring payment of Rs. 41,666-11-0 on account of the tax (Rs. 51,666-11-0 less Rs. 10,000 paid) by 15th May, 1950. No further amount being paid into the Income-tax office the ITO, District I(2), Calcutta, wrote a letter dt. 12th April, 1951, to the Certificate Officer, 24-Parganas, informing him that the demand had been reduced to Rs. 51,666-11-0 on account of tax and surcharge, and Rs. 50,100 on account of penalty, and that the certificate filed on 10th Feb., 1949, might be corrected accordingly, and the certificate case proceeded with. It was also intimated that Rs. 10,000 out of the reduced demand had been paid into the Income-tax office. THE certificate filed on 10th Feb., 1949, was amended accordingly, and steps for realisation of the amount were taken : the certificate case had remained stayed till then, awaiting the result of the appeals by the petitioner or his firm. After resumption of proceedings in the certificate case, the petitioner with his partners paid a total sum of Rs. 54,500 into the certificate Court, in some instalments, so that the amount paid comes to Rs. 64,500 and a balance of Rs. 37,266-II-0 remained due. THE petitioner tried to obtain remission of that amount by applying to the Central Board of Revenue. Being unsuccessful, the petitioner filed an objection before the Certificate Officer on 17th July, 1957, contending that the certificate field against the defunct firm was liable to be cancelled on four grounds, viz., (1) defect in the form of the certificate, (2) defect in the notice under s. 7 of the Public Demands Recovery Act, (3) failure to issue a fresh certificate under s. 46 (2) of the IT Act after modification of the original demands by the Tribunal, and failure to file a fresh certificate under s. 4 of the Public Demands Recovery Act (the Certificate Officer erroneously summarised this ground as demand notice being in respect of different amounts), and (4) making of assessment on a discontinued unregistered firm in the firm name and not in the names of the partners. THE Certificate Officer, 24-Parganas, heard the objections on the same date, and allowed only one objection, viz., that relating to the defect in the form of the notice; he held that notice as issued under a facsimile rubber- stamp signature of the Certificate Officer was bad, and directed that a fresh notice under s. 7 be issued under the signature of the Certificate Officer. THE other objections were overruled. An appeal was preferred before the Divisional CIT against the order of the Certificate Officer. THE learned Divisional CIT while hearing the appeal for admission on 21st Aug., 1957, overruled the objection relating to the failure to issue a fresh certificate under s. 46(2) of the IT Act and to file a fresh certificate under s. 4 of the Public Demands Recovery Act, by referring to the decision in Ladhuram Taparia vs. D.K. Ghosh (1958) 33 ITR 407 (Cal) : TC52R.1361 that when the amount of demand was reduced by the appellate authority, these were not necessary. He also overruled the objection relating to the assessment having been made on a discontinued unregistered firm, holding that the certificate Court could not go behind the decision of the IT authorities, and that there was no allegation that the Certificate Officer was proceeding against the personal property of any of the partners. THE learned Divisional CIT by his order dt. 21st Aug., 1957, admitted the appeal only on the ground of defect in the form of the certificate filed under s. 4 of the Public Demands Recovery Act, the defect being that the tax demand and the penalty were not separately shown in the certificate. THE Divisional CIT heard the appeal ex parte on the 14th Oct., 1957, none having appeared on behalf of the IT Department. He pointed out that in the certificate originally filed, the total amount of the demand, Rs. 1,64,639-9- 0, was mentioned against the heading "Amount of public demand..... and period for which such demand is due" (henceforward called the second heading); and against the heading "Further particulars of the public demand for which the certificate is signed" (henceforward called the fourth heading), it was only noted "I. Tax for 43-44", and that the tax demand and the penalty were not separately noted; and the description "penalty" not mentioned at all; and similarly, in the amended certificate, the reduced total demand of Rs. 1,01,766-11-0 was shown in lump, with a note "vide ITO's letter dt. April 12, 1951", but still the amount of the tax demand and the penalty were not separately specified. THE learned Divisional CIT held, relying on the decision of Abanindra Kumar Maity vs. A.K. Biswas AIR 1954 Cal 355, that in view of the non-mention of particulars, the certificate was void ab initio; and he cancelled the certificate. THE IT Department (strictly, the Union of India represented by the CIT) then filed a revisional petition under s. 53 of the Public Demands Recovery Act before the Board of Revenue. THE Member, Board of Revenue, referred to the unreported Division Bench decision of Union of India vs. Jiwanmull Bhutoria CR 784/57 decided on 3rd June, 1959 and observed that if the public demand was sufficiently identified the omission to mention some particulars would not vitiate the certificate proceedings; and that in the present case the certificate debtor could identify the public demand quite clearly and, therefore, the lack of some particulars in the certificate was no reason for cancelling the certificate. THE learned member also dealt with no point regarding filing of a fresh certificate after the service of a fresh notice of demand, observing that in view of the decision in Ladhuram Taparia's (supra), the service of a fresh notice of demand was not necessary when the demand was reduced in appeal, and that, therefore, the fresh notice of demand for the reduced amount of the demand should be taken as non-existent and would not make any difference. Accordingly, the learned Member allowed the revision petition and directed that the certificate case do proceed. THE petitioner, Ajit Kumar Ganguli, has obtained this rule under Art. 227 of the Constitution against the aforesaid order of the Board of Revenue. Mr. H.P. Mukherjee, appearing on behalf of the petitioner, has urged before us that the unreported decision on which the learned Member of the Board of Revenue relied, viz., Union of India vs. Jiwanmull Bhutoria (supra) on 3rd June, 1956, must be deemed to have been superseded by a still more recent decision of this Court, viz., Satish Chandra Bhowmick vs. Union of India (1960) 65 CWN 324, where a Division Bench of this Court doubted the correctness of the decision of the decision in Union of India vs. Jiwanmull Bhutoria (supra) and reaffirmed the statement of law made in the decision of Abanindra Kumar Maity vs. A.K. Biswas (supra). He has, therefore, urged that the certificate filed against the unregistered firm of which the petitioner was a partner must be cancelled on the ground that it did not mention the particulars required to be mentioned in the form. THE position of law on the point has, therefore, to be examined.
There are two decisions of the Privy Council on the point. The first one is Baijnath Sahai vs. Ramgut Singh (1896) LR 23 IA 45, a decision made in 1896, with reference to the corresponding provisions of an earlier Act, the Public Demands Recovery Act of 1880 (Bengal Act VII of 1880). An estate belonging to the respondents was sold under the certificate procedure for arrears of road cess; the respondents having failed to have the sale set aside by proceedings under the Act of 1880, filed a suit in the civil Court and succeeded. The Privy Council pointed out that no certificate under s. 7 of the Act of 1880 (corresponding to the certificate under s. 4 of the Act of 1913) appeared to have been filed at all, and held that there was no foundation for a sale under the certificate procedure in the circumstances. The following extract from page 54 contains the recital of the relevant law :
"It is unnecessary for their Lordships to point out the necessity there is when a power is given to a public officer to sell the property of any of Her Majesty's subjects that the forms required by the Act, which are matters of substance, should be complied with, and that if the certificate is to have the extraordinary effect of a decree against the persons named in it as debtors, and to have the effect of binding their immoveable property, at least it should be in a form such as provided by the Act, which enables any person who reads it to see who the judgment- creditor is, what is the sum for which the judgement is given, and that those particulars should be certified by the proper officer appointed by the Act for the purpose. If no such certificate is given, then the whole basis for the proceeding is gone."
It is quite clear that if there is no certificate signed and filed at all under the provisions of the Public Demands Recovery Act, the entire certificate proceeding is without jurisdiction. The existence of such a certificate is absolutely necessary for the validity of the proceedings, but the observations of the Judicial Committee in the above case cannot in our opinion be interpreted to mean that if there is the slightest deviation from the prescribed form, or the slightest error or omission in filling up the form, the proceedings become without jurisdiction. It is undoubtedly necessary that the certificate should be duly signed by the authorised officer, and should show the name of the creditor (and the debtor) and the amount due under the certificate, but there appears to be no justification for reading more into the above decision. This position follows from the next decision of the Judicial Committee, viz., Doorga Prosad Chamaria vs. Secretary of State (1945) LR 72 IA 114 : (1945) 13 ITR 285 (PC) : TC52R.552, decided in 1945 under the Publication Demands Recovery Act of 1913 (Bengal Act III of 1913). From the statement of facts, it appears that in the certificate filed in that case, only the total amount of the demand was mentioned in column 4 of the certificate in Form I, and the particulars mentioned in column 5 were "income-tax and penalty". The period of the income-tax demand was not mentioned; neither were the tax demand and penalty shown separately. After an objection under s. 9 of Bengal Act III of 1913 had been disposed of, the debtor filed a suit for the declaration that the certificate was void, and for other reliefs. The Judicial Committee, in dealing with the objections as to the validity of the certificate, held that it was immaterial that the certificate creditor had been described as "The Secretary of State of India on behalf of the ITO, Howrah", instead of the correct "The Secretary of State for India" only; and that the period for which the demand was due was not noted in column 4, although the heading requires the period to be noted; it being observed the income-tax becomes due when demand is made under s. 29 and s. 45, but the demand is not due for any particular period. In Abanindra Kumar Maity vs. A.K. Biswas (supra) decided in 1954, a Division Bench if this Court held a certificate to be invalid because (1) the certificate creditor was described as the Government of West Bengal, instead of Union of India, the demand being in respect of arrears of income-tax; (2) the period for which the demand was due was not mentioned; and (3) against the heading for further particulars, it was not noted that the assessment was for undisclosed income of 1946-47; and it also held another certificate to be invalid because the demand included penalty imposed by the ITO and the reason for the imposition of the penalty was not noted against the heading "further particulars". In the light of the decision of the Judicial Committee in Doorga Prosad Chamaria vs. Secretary of State (supra), it is difficult to agree that a certificate in respect of arrears of income-tax becomes invalid if the period is not stated in the certificate; and as regards the description that a demand is in respect of tax assessed on undisclosed income for a particular period, and still more, as regards reasons for the imposition of the penalty it is difficult to say how these things can be required to be furnished under the heading "further particulars". No such things were required in the above case dealt with by the Judicial Committee, and this Court can hardly require that a certificate under s. 4 of the Bengal Act III of 1913 should incorporate the matters required in a summary judgment. This is more or less what was pointed out in the next decision of this Court, the unreported case, Union of India vs. Jiwanmull Bhutoria (supra). The Division Bench in deciding the case drew attention to Doorga Prosad Chamaria's case (supra) and held that it was not necessary to mention the period or the date. of the demand under s. 29 or s. 45 of the IT Act, and that it was not necessary to mention against the heading "further particulars" that the assessment is in respect of a concealed or undisclosed income. This division bench did not consider a reference to a full bench necessary, though their view of the law was different from that of the division bench decided the case, Abanindra Kumar Maity vs. A.K. Biswas (supra) because the latter Bench had failed to take into consideration the second decision of the Judicial Committee in Doorga Prosad Chamaria's case (supra) which is binding on this Court. This reported decision laid down the test that the debt due must be sufficiently identified in the certificate, and if the public demand be sufficiently identified it is not necessary to give any further particulars. Next we come to the decision in Satish Chandra Bhowmick vs. Union of India (supra) relied upon by Mr. H.P. Mukherji. It reverts back to the statement of law in Abanindra Kumar Maity vs. A.K. Biswas (supra) and disagree with the unreported decision cited above. It is queer that the Calcutta Weekly Notes should think fit to report two cases taking one line, and not the case taking a contrary line : it is certainly desirable that different views on the same question should be reported, so that one point of view may not become lost in course of time, and so that the correct position may ultimately be thrashed out by a Full Bench or otherwise. Be that as it may in Satish Chandra Bhowmick's case (supra) their Lordships relied on their reading of the law recited in the earlier Privy Council case, Baijnath Sahai vs. Ramgut Singh case (supra) and in respect of the later decision in Doorga Prosad Chamaria vs. Secretary of State case (supra), expressed their view in the following terms :
"It is true that the decisions of the Privy Council are entitled to great respect, but when an earlier Privy Council decision lays down the law and legal principles by giving good reasons therefor and another Privy Council decision expresses a contrary view without adverting to the earlier decision at all, and without giving much reasons for its dictum, then we prefer to follow the earlier one that has given reason."
With due respect, this was not in our opinion a correct approach. In the case with which the first decision of the Privy Council was concerned, there was no certificate signed and filed at all; so naturally, the proceeding was held to be without foundation. There is absolute want of jurisdiction in proceeding with a certificate case without a certificate being signed and filed in terms of the relevant provisions of the Public Demands Recovery Act. Even in that case, the test laid down by the Privy Council was that there should be a certificate signed by an authorised officer in a form such as prescribed by the Act, which enables any person who reads it to see who the certificate creditor is and what is the sum due under the certificate. This test tallies with the test recited in the unreported decision of this Court, viz., that the public demand should be sufficiently identified in the certificate, and of course that the names of the creditor and the debtor should appear therein. The later decision of the Privy Council dealt with a case in which there was a certificate signed and filed by an authorised officer in a prescribed form, and their Lordships had only to deal with the question of sufficiency of the particulars entered in the form. The two decisions are complementary and not contrary at all.
(3.) IN Satish Chandra Bhowmick vs. Union of INdia (supra), it was held that for the validity of the certificate proceedings, the necessity is not merely that the certificate is intelligible and the procedure adopted is one of substantial compliance with law, but the necessity is strict adherence to every requirement of the Act, which is a minimum guarantee that the legislature has prescribed in a summary procedure. It is a matter of regret that the division bench should have decided the case on a view of law contrary to that of the unreported decision of another division bench and not referred the matter to a full bench. We would certainly have referred to a full bench the question involved, viz., whether substantial compliance with the prescribed form of certificate, so that the public demand can be identified, is sufficient for the validity of certificate proceedings, and whether "further particulars" include such things as the description of a tax demand as assessment on concealed or undisclosed income, and reasons for imposing a penalty when the demand includes it. But we are saved from the necessity of doing so on account of an Act that has come into force in the meantime, viz., the Bengal Public Demands Recovery (Validation of Certificates and Notices) Act, 1961 (W. B. Act XI of 1961) published in the Calcutta Gazette on 28th April, 1961. The Act is as follows :
"Whereas it is expedient to validate. certain certificates filed and notices served under the Bengal Public Demands Recovery Act, 1913. It is hereby enacted, on the Twelfth year of the Republic of INdia, by the legislature of West Bengal as follows : 1. This Act may be called the Bengal Public Demands Recovery (Validation of Certificates and Notices) Act, 1961. 2. Notwithstanding any decision of any Court and notwithstanding anything to the contrary contained in the Public Demands Recovery Act, 1913 (hereinafter referred to as the said Act) or in the rules made or forms prescribed thereunder, no certificate filed under s. 4 or s. 6 of the said Act and no notice issued shall be called in question merely on the ground of any defect, error or irregularity in the form thereof."
The defects or irregularities in the certificates filed in the present case have already been mentioned : they are (a) omission to specify the tax demand and demand for penalty separately, and (a) mentioning only "income-tax for 43-44" against the fourth heading, without specifying that the demand comprises income-tax and penalty. Mr. Mukherjee has also referred to the omission to mention the period against the second heading; but the period is noted in any case against the fourth heading. Mr. Mukherjee has not seriously urged that the reasons for the imposition of the penalty also required to be shown against the fourth heading; in our opinion, such reasons are definitely uncalled for in the prescribed form for a certificate; but even if required, the omission to state the reasons would only be a defect. None of the defects or irregularities prevented the certificate debtors from understanding the nature of the public demand mentioned in the certificate. The assessment of income-tax and super-tax on the income of the discontinued firm for the asst. yr. 1943-44 and the imposition of penalty under s. 28(1)(b) of the IT Act had been done in the presence of the petitioner or his representative; notices of both demands under s. 29 of the IT Act had duly been served; the petitioner filed an appeal and a second appeal from the order of assessment of tax and imposition of penalty; and in pressing his application for cancelling the certificate it was urged that the tax demand for Rs. 83,111-15-0 and the penalty of Rs. 81,527-10- 0 had been lumped together in the certificate and that this was a fatal defect. It is clear therefore that the petitioner fully understood what was the public demand mentioned in the certificate, even though the items making up total demand were not separately specified therein and the demand was loosely described or misdescribed as "income- tax for 43-44" instead of "income-tax for 1943- 44 and penalty under s. 28(1)(b)." We find that the certificate could be understood by the petitioner in spite of the defects it contained, and the petitioner was not prejudiced in any way on account of the defects, and therefore, in view of the declaratory law contained in West Bengal Act XI of 1961, we hold that the certificate filed in the case cannot be held to be invalid.;