Grover, J. - (1.) These are two connected appeals by certificate from a common judgment of the High Court of Assam and Nagaland allowing two petitions under Article 226 of the Constitution and setting aside the assessments made in respect of the respondents for the assessment years 1955-56 and 1957-58 under the Assam agricultural Income Tax Act, 1939, hereinafter called the Act.
(2.) A general notice was issued under Section 19 (1) of the Act for submission of the return for the purpose of agricultural income-tax on April 13, 1945 (1955 ) for the assessment year 1955-56. According to the departmental authorities a notice was also issued under S. 19 (2) on September 16, 1955 to the respondents by the Agricultural Income-tax Officer for submission of a return for the same year which was followed by reminders sent on April 30, 1956 and April 15, 1958. It is, however, not disputed that the respondents themselves filed a return on May 31, 1958 relating to agricultural income for the assessment year 1955-56. On April 7, 1959 the Agricultural Income-tax Officer made an assessment order under Section 20 (1) of the Act and a notice of demand was issued under Section 33 on April 13, 1959. It is unnecessary to give the details about the proceedings relating to the assessment year 1957-58 in which the dates are naturally different but the position is identically the same. On June 4, 1962 the respondents filed two petitions under Arts. 226 and 227 of the Constitution challenging the assessments which had been made primarily on the ground that no notice had been served under S. 19 (2) and therefore there was no jurisdiction in the Agricultural Income-tax Officer to pass an order of assessment under Section 20 (1) of the Act and further that since no assessment order had been passed and no notice of demand had been made within the period of three years of the end of the relevant financial year the assessments were barred by time under Section 30 of the Act. In the return which was filed in the High Court to the writ petition, it was asserted by the Assistant Commissioner of Taxes that the respondents had been served with a notice under Section 19 (2) and the details of the notices and the reminders which were issued together with copies thereof were filed as annexures. It was maintained that even on the assumption that no notice under Section 19 (2) had been received by the respondents the submission of the return of agricultural income was in compliance with the terms of the notice issued under Section 19 (1) and therefore the assessment order made under Section 20 (1) was perfectly valid and no question arose of the applicability of Section 30 in such circumstances.
(3.) The High Court decided the petition in favour of the respondents primarily on the following considerations:(1) Once agricultural income has escaped assessment in any financial year then such income could be assessed within the period prescribed or laid down in Section 30 namely, a period of three years by taking the steps indicated in that section. In the present case the agricultural income was received for the first year in the year 1954-55 and had to be assessed in the financial year 1955-56. Since no assessment had been made in that financial year it had escaped assessment. Thus, Section 30 was directly attracted. As an assessment was made on April 7, 1959 which was beyond three years from the expiry of the last date of the financial year in which the income had been assessed the assessment was invalid. (2) As no notice either under Section 19 (2) or under Sec. 30 had been shown to have been served the assessment should have been made before the expiry of three years from the last date of the financial year, namely 1955-56 which was not done. (3) The submission of a voluntary return by the assessee did not alter the situation as there was no provision in the Act which would help the department in that behalf. It was open to the department to have assessed the assessee before the expiry of the period of three years on receipt of the return but that was not done.;