- (1.) THIS is a writ petition under article 226 of the Constitution of India. The prayer is for the issue of a writ of certiorari quashing the recovery certificate dated 17th March, 1961, issued by the Income-tax Officer, District I(vii), Kanpur, to the Collector, Etawah, and for a mandamus restraining the Collector, Etawah, from realising the tax for the assessment year 1955-56, covered by the certificate dated 17th March, 1961.
(2.) THE material facts leading up to this petition are these : THE petitioner was assessed on an income of Rs. 16,939.78 nP. by the Income-tax Officer, District I(vii), Kanpur, as a Hindu undivided family : vide assessment order in respect of the relevant assessment year 1955-56. THE said assessment order was made at Kanpur. In pursuance of the said order a notice of demand dated the 29th February, 1960, was served upon the petitioners counsel on the 22nd of March, 1960, requiring the petitioner to deposit the said amount of tax of Rs. 16,939.78 nP. on or before the 20th March, 1960. A copy of the demand notice which is said to be a true copy annexed to the petition as annexure B" does not give the place at which payment was required to be made by the petitioner. It, however, mentions that the challan is being enclosed for the purpose. It may be that the challan gives the particulars which are missing from the demand notice. In any event, the Income-tax Officer has not challenged the correctness of annexure B" filed by the petitioner. Aggrieved by the notice of demand, the petitioner filed appeals but was unsuccessful. During the pendancy of the appeals the petitioner had deposited Rs. 4,000 in two lump sum installments of Rs. 2,000 on the 26th of November, 1960, and 25th of January, 1961, respectively towards the aforesaid demand. On the 17th of March, 1961, the Income-tax Officer, District I(vii), Kanpur, who had jurisdiction over the district of Etawah issued a certificate under section 46(2) of the Indian Income-tax Act, 1922 (hereinafter referred to as the Act), to the Collector, Etawah, requiring him to recover the balance of Rs. 12,939.78 nP. from the petitioner. A warrant of arrest and attachment was issued by the Tahsildar on the 22nd of April, 1963, for failure to pay the demand made. THEreupon, the petitioner filed this writ petition on the 21st of May, 1963. The grounds challenging the issue of certificate dated the 16th March, 1961, are : (i) that the Income-tax Officer, District I(vii), Kanpur, had no jurisdiction to issue the certificate under section 46(2) of the Act to the Collector of Etawah, and consequently the Collector of Etawah had no jurisdiction to act upon the same; and (ii) that there was no default under section 45 of the Act, and, therefore, no certificate under section 46(2) of the Act could have been issued. The second ground taken may require some explanation and it is that, though the demand notice was dated 29th February, 1960, and required payment of the amount of tax due to be made on or before the 20th March, 1960, the notice was not served till after the period stipulated therein for payment had expired and as such the petitioner cannot be said to be an assessee in default within the meaning of section 45 of the Act. Section 45 reads : 45. Any amount specified as payable in a notice of demand...... under section 29.....shall be paid within the time, at the place and to the person mentioned in the notice or order, or if a time is not so mentioned, then or before the first day of the second month following the date of the service of the notice or order, and any assessee failing so to pay shall be deemed to be in default.....
(3.) THE contention of the petitioner is that there could be no non-compliance with the notice within the time stipulated when the time which was given for compliance had already expired before the notice was served, and, therefore, he could not be considered to be an assessee in default. On the other hand, the learned standing counsel for the department contends that in the circumstances of the case such notice should be treated and deemed to be one, not specifying any time therein and, therefore, the petitioner was bound to invoke and comply with that part of section 45 which provides .....then on or before the first day of the second month following the date of the service of the notice or order.... In other words, the petitioner cannot escape from his liability to comply with the demand notice merely on account of the latches on the part of the office of the Income-tax Officer to serve the notice before the period specified therein had expired and it was the petitioners duty to have treated such notice as not specifying any date and to have made compliance therewith on or before the first day of the second month following the date of the service. It is, however, not necessary in this case to decide this point, as I have come to the conclusion that the certificate issued under section 46(2) by the Income-tax Officer, District I(vii), Kanpur, to the Collector, Etawah, was without jurisdiction as it was not in accordance with section 5 of the Revenue Recovery Act (I of 1890). Section 46, which falls within Chapter VI of the Act and which deals with the recovery of tax and penalties is concerned with the mode and time of recovery when the assessee is in default in making payment of income-tax, that is, when he is an assessee in default as provided in section 45 of the Act. Thus, apart from levying penalty for such default, the Income-tax Officer has been given the right to forward a certificate for recovery to the Collector under section 46(2) of the Act as if it were an arrear of land revenue. Section 46(2) runs : 46. (2) THE Income-tax Officer may forward to the Collector a certificate under his signature specifying the amount of arrears due from an assessee, and the Collector, on receipt of such certificate, shall proceed to recover from such assessee the amount specified therein as if it were an arrear of land revenue. It may be noted that the certificate has to be forwarded to the Collector and not to any" Collector that the Income-tax Officer may deem fit so to do. In order to determine who is the Collector to whom the recovery certificate must necessarily be sent, very little assistance can be had from the Act itself as the expression the Collector has not been defined in the Income-tax Act and it appears for the first time in section 46(2) of the Act. Some help, however, can be obtained from the Revenue Recovery Act (I of 1890), which was enacted to make a better provision for the recovery of certain public demands. In section 2 of the Revenue Recovery Act, Collector means the chief officer in charge of the land revenue administration of a district and a defaulter means a person from whom an arrear of land revenue, or a sum recoverable as an arrear of land revenue is due... Section 3 of Act I of 1890 provides for the recovery of public demands by enforcement of process in other districts than those in which they became payable. Section 3 reads : 3. (1) Where an arrear of land revenue, or a sum recoverable as an arrear of land revenue, is payable to a Collector by a defaulter being or having property in a district other than that in which the arrear accrued or the sum is payable, the Collector may send to the Collector of that other district a certificate in the form as nearly as may be of the Schedule, stating... ;