vil Appeals Nos 1537 to 1545 of 1968
Appeals from the judgment and order dated April 4 1963 the Assam High Court in Civil Rules Nos 233 to 236 and 238 to 242 of 1961
Naunit Lal and SN Choudhury for the appellants in all the appeals
MC Chagla and Sukumar Ghose for the respondents in all the appeals
The Judgment of the Court was delivered by Grover J
These are nine connected appeals by certificate from a judgmentof the High Court of Assam  Naggland whereby nine petitions filed by the respondents under article 226 of the Constitution were allowed and the assessment orders made under the provisions of the Assam Agricultural Income tax Act 1939 hereinafter called the Act  were quashed
The facts may be first stated
DC Choudhuri and SC Dutt petitioners in four of the writ petitions owned the Martycherra Tea Estate in the district of Cachar which they had purchased on January 1 1948
They sold this Estate on July 9 1953
From January 1 1948 to July 9 1953 they carried on the business of cultivation manufacture and sale of black tea at the said Estate under a partnership of which they were the sole partners
The partnership firm was served with a notice under the Indian Income tax Act 1922 hereinafter called the Income tax Act and was assessed to income tax for the assessment year 1951 52
Appeals were filed against the assessment order before the Appellate Assistant Commissioner of Incometax and the Income tax Appellate Tribunal in which substantial reliefs were given to the assessee
After the sale of the Tea Estate these assessees ceased to have any agricultural income
The case of the assessees as laid in the writ petition was that on January 25 1961 a letter was received by one of them from the Agricultural Income tax Officer directing both the assessees to furnish returns of their agricultural income for the assessment years 1949 50 to 1953 54
Thereafter they received a notice of demand under section 23 of the Act for payment of a certain amount as agricultural income tax for the assessment year 1950 51
The assessment 782 order was stated to have been made under section 204 of the Act
Similar orders were made and demands created with regard to the subsequent years namely 1951 52 1952 53 and 1953 54
All these assessment orders were challenged by means of four petitions under article 226 of the Constitution
Apart from other points which were raised the main objection taken was that no notice under section 30 of the Act had been served at any time in respect of the assessment covered by the impugned orders
Such a notice could be served only within three years of the end of the financial year
In the absence of service of the aforesaid notice within the prescribed period the Income tax Officer had no jurisdiction to make any assessment nor could such an assessment be made after the expiry of a period of three years from the end of each financial year
The other set of petitions
under article 226 of the Constitution was filed by the company The Eastern Tea Estate Private Ltd This company owned two tea estates the Chandna Tea Estate and the Martycherra Tea Estate
The Chandna Tea Estate was purchased from the Indian Tea and Mill Industries Ltd in 1950 and the Martycherra Tea Estate was purchased from Ms DC Choudhuri and SC Dutt on July 9 1953
The case of the company was that no notice had been received under section 192 of the Act for the assessment years 1951 52 to 1955 56 and therefore no returns were filed
On October 9 1959 the company received a letter from the Agricultural Income tax Officer Shillong asking it to submit returns in respect of Martycherra Tea Estate for the assessment year 1950 51 onwards
The company addressed a communication to the Agricultural Incometax Officer on November 18 1959 saying inter alia that no notice had been served on it under the Act previously and as it also owned the Chandna Tea Estate it proposed to submit returns for the years in respect of which it was liable under the Act
On October 19 1959 the company received a notice under section 19 2 of the Act directing it to submit the return in respect of the previous year for Martycherra Tea Estate
In response to the notice the company submitted the return for the year ending December 31 1958 showing the agricultural income from tea estates
A number of notices were served subsequently and there was further exchange of correspondence
It was alleged in the petitions filed by the company that a letter was received dated January 23 1960 from the Agricultural Income tax Officer in which it was stated that the company had failed to submit the returns for the years 1950 51 to 1958 59 and it was asked to show cause why the assessments for these years should not be completed summarily
After further exchange of correspondence the company received an assessment order dated June 19 1961 in respect 783 of the assessment year 1951 52 which was made under section 204 of the Act together with a notice of demand for payment of a certain amount of agricultural income tax
Similar assessment orders were passed under section 204 and demands created in respect of the assessment years 1952 53 1953 54 1954 55 and 1955 56
All these assessments were challenged by means of five petitions under article 226 of the Constitution
The main point raised in all these petitions was that unless individual notices under section 192 of the Act had been served no assessment could be made under section 204 except by way of proceedings under section 30 of the Act
In the returns which were filed by the Agricultural Incometax Officer to all the petitions filed in the High Court it was maintained that the assessees had refused to accept the service of the notices under sections 192 and 30 of the Act
The notice under section 191 had been published in the Assam Gazette and the assessees were bound to make a return pursuant to that notice
It was denied that there was any necessity of serving notices under sections 192 or 30 of the Act and that the assessments which had been made were barred by limitation
A division bench of the Assam  Nagaland High Court consisting of Mehrotra CJ and SK Dutta J allowed all the petitions but delivered separate judgments
The learned Chief Justice held that where no return had been filed pursuant to a general notice under section 191 the Agricultural Income tax Officer was bound to proceed under section 30 and issue a notice under section 192 of the Act within the prescribed period namely three years of the end of the financial year
He further held that there was no service of notice on the respondent in respect of the assessment years in question either under section 192 or section 30 of the Act
SK Dutta J came to the same conclusion as the learned Chief Justice but he relied on a judgment of the Calcutta High Court in Commissioner of Agricultural Income tax vs Sultan Ali Gharami1 in which a dissent had been expressed from the Bombay judgment in Harakchand Makanji  Co vs
Commissioner of Income tax Bombay City2 on the question as to when proceedings relating to assessment could be regarded as having commenced
According to the learned judge if no return is made in response to a public notice under section 191 of the Act and no individual notice is served under section 192 there would be no pending proceedings and it would be a case of escaped assessment
But this would be so only after the expiry of the financial year
In other words after the publication of the notice under section 191 there would be no escapement of income till the end of the financial year
Once the financial year is over and no return has been made in response to a notice under 1 2 L15 Sup
CI69 6 784 section 191 and no individual notice has been served under section 192 a case would arise of escaped assessment for the financial year The relevant provisions in Chapter IV of the Act may now be noticed
Sections 19 and 20 contain provisions similar to sections 22 and 23 of the Income tax Act
Under section 191 of the Act the Agricultural Income tax Officer before the specified date shall give notice by publication in the press or otherwise requiring every person whose agricultural income exceeds the limits of taxable income prescribed in section 6 to furnish within such period not being less than 30 days as may be specified a return in the prescribed form setting forth his agricultural income during the previous year
Sub section 2 provides that in the case of any person whose total agricultural income is in the opinion of the Agricultural Income tax Officer of such amount as to render such person liable to payment of agricultural income tax for any financial year he may serve in that financial year a notice requiring him to furnish within the prescribed period a return
Sub section 3 enables a person who has not furnished a return within the time allowed by or under sub section 1 or sub section
2 to furnish a return or a revised return at any time before the assessment is made
Thus sub sections
1 2 and 3 of section 19 of the Act are identical with and correspond to sub sections
1 2 and 3 of section 22 of the Income tax Act
Under section 20 of the Act if the Agricultural Income tax Officer is satisfied that a return made under section 19 is correct and complete he has to assess total agricultural income of the assessee according to it
If he has reason to believe that such a return is incorrect or incomplete he has to serve a notice requiring the person who has made the return to produce any evidence on which he may rely in support of the return
After hearing such evidence as the person making the return may produce and such other evidence as the officer may require on specified points the assess ment order is to be made
These are the provisions of sub sections
1 2 and 3
Sub section
4 is in the following terms  If the principal officer of any company or other person fails to make a return under sub section 1  or sub section 2 of section 19 as the case may be or having made the return fails to comply with all the terms of the notice issued under sub section 2 of this section or to produce any evidence required under sub section 3 of this section the Agricultural Incometax Officer shall make the assessment to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment Provided     785 Turning to section 23 of the Income tax Act sub sections 1 2 and 3 thereof correspond to sub sections 1 2 and 3 of section 20 of the Act
Sub section 4 of section 23 reads  if any person fails to make the return required by any notice given under sub section 2 of section 22 and has not made a return or a revised return under sub section 3 of the same section or fails to comply with all the terms of a notice issued under subsection 4 of the same section or having made a return fails to comply with all the terms of a notice issued under sub section 2 of this section the Incometax Officer shall make the assessment to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment and in the case of a firm may refuse to register it or may cancel its registration if it is already registered
Provided     Section 30 of the Act which corresponds to section 34 of the Incometax Act which deals with income escaping assessment may now be reproduced  If for any reason any agricultural income chargeable to agricultural income tax has escaped assessment for any financial year or has been assessed at tooow a rate or has been the subject of undue relief under this Act the Agricultural Income tax Officer may at any time within three years of the end of that financial year serve on the person liable to pay agricultural income tax on such agricultural income or in the case of a company on the principal officer thereof a notice containing all or any of the requirements which may be included in a notice under sub section 2 of section 19 and may proceed to assess or reassess such income and the provisions of this Act shall so far as may be apply accordingly as if the notice were a notice issued under that sub section Provided     The principal contention raised on behalf of the appellant is that for an assessment to be made under section 204 of the Act it is not necessary that proceedings should have been taken under section 30
The argument is that assessment proceedings commence with the publication of a general notice under section 191 and it is open to the Agricultural Income tax Officer to make 786 the best judgment assessment under section 204 without any limitation as to time
It is not necessary to issue any individual notice under section 192 or to initiate proceedings under section 30 in such a situation
Reliance has been placed on the observations in Harakchand Makanji  Co vs Commissioner of Income tax Bombay City1 that once a public notice is given under sub section 1 of section 22 of the Income tax Act which is similar in terms to section 191 of the Act the assessment proceedings should be deemed to have commenced and there is no obligation on the Income tax Officer to serve an assessee individually as well
But in the same case it was said that a notice under section 34 is only necessary if at the end of the assessment year no return has made by the assessee and the Income tax authorities wish to proceed under section 222 by serving a notice individually
It may then be said that as the assessment year had come to an end and as no return had been furnished and as the authorities wished to proceed under section 222 they should not do so without a notice under section 34
The above view was approved by this Court in The Commissioner of Income tax Bombay vs Ranchhoddas Karsondas Bombay2 but the portion which has been extracted does not support the contention which has been pressed on behalf of the appellant
Indeed it has been relied upon more firmly by the counsel for the respondents
If this view is accepted to be correct it follows that a notice under section 30 of the Act in the present case would be necessary if at the end of the assessment year no return has been made by the assessee and the authorities wish to proceed under section 192
The case would be entirely different where he himself chooses voluntarily to
make a return
This he can do after the publication of a general notice under section 191 of the Act
If the return is filed no question arises of any income having escaped assessment
The return under the provisions of section 193 of the Act can be furnished at any time before the assessment is made
This is what this Court held in The State of Assam Anr
vs Deva Prasad Barua  Anr3
The position is altogether different if no return has been made by the assessee and where income has not been assessed at all because for one reason or the other no assessment proceedings were initiated
That would be a case of escaped assessment within section 30 of the Act
The matter was examined at length by this Court in Ghansyam Das vs Regional Assistant Commissioner of Sales Tax Nagpur4 with reference to the provisions 
of the Central Provinces  Berar Sales Tax Act 1947
The 1 2  3 1969 1 SCR 698
4  787 following principles were laid down in that case which are noteworthy  1 In the case of a registered dealer the proceedings before the Commissioner started factually when a return was made or when a notice was issued to him either under section 103 under which the Commissioner has to issue a notice if no return is submitted or under section 114which provides for the best judgment assessment of the Sales Tax Act
The statutory obligation to file a return did not initiate the proceedings
2 Once a statutory return was filed pursuant to a notice under section 103 or section 11 of the Sales Tax Act the proceedings did not come to an end until the final assessment was made
3 The expression escaped assessmentin section 11A of the Sales Tax Act included that of a turnover which had not been assessed at all because for one reason or the other no assessment proceedings were initiated and no assessment was made in respect thereof
Keeping in view the above principles it must be held that in the absence of a return having been filed by the assessees in the present case pursuant to a general notice under section 291 of the Act assessment could be made only after due notice section 192 or by initiating proceedings under section 30 of the Act
Section 192 requires that an individual notice is to be served in the financial year
If no notice is served under that section proceedings under section 30 can be initiated by a notice in accordance with that section within three years of the end of that financial year
In this connection it may also be remembered that section 432a of the Act confers a valuable right on the assessee in the matter of choosing the forum for the assessment
According to that provision an assessee may on receipt of the first notice served on him under section 192 apply to the Agricultural Income tax Officer by whom such notice is served to be assessed at the usual place of residence or at the place where the accounts relating to his agricultural income are kept
The Agricultural Income tax Officer can then make an order that the assessee shall be assessed at the place specified in the application or he has to refer the matter to the Assistant Commissioner of Agricultural Income tax whose decision shall be final
No such right is conferred on the assessee with reference to publication of a general notice under section 19 1 
It shows therefore that the proceedings for assessment under the Act can be initiated only by 788 notice trader section 192 or by having resort to the provisions of section 30 of the Act
Counsel for the appellant has sought to make a distinction between the decision given under the provisions of the Incometax Act by pointing out that under section 204 of the Act best judgment assessment can be made on the failure to make a return under sub section 1 or sub section 2 of section 19 whereas under section 23 4 of the Income tax Act such an assessment can be made only where any person fails to make the return required by any notice given under sub section 2 of section 22 which is equivalent to section 192 of the Act
This distinction is hardly material when the principles which have been laid down by this Court are kept in view
In support of his contention counsel for the appellant has also called attention to a decision of the Privy Council in Gokuldas Ratanti Mandavia vs Commissioner of Income tax1 in which the provisions of the East African Income tax Management Act 1952 came up for consideration
Those provisions are altogether different and the decision rested on the wording of section 71 of that enactment
It cannot therefore be of any assistance in the present case
For the reasons given above the appeals fail and they are dismissed with costs
One hearing fee
VPS Appeals dismissed


Summary:
The assessee owners of a tea estate in Assam after carrying on the business of cultivation manufacture and sale of tea during the years 1948 to 1953 sold the tea estate on July 9 1953
In 1961 they received a notice from the Agricultural Income tax Officer to furnish returns of their agricultural income for the assessment years 1949 50 to 1953 54 in respect of that tea estate
They did not submit any returns
Thereafter they received a notice of demand under section 23 of  the Assam Agricultural Incometax Act 1939 for payment of the tax assessed on best judgment basis under section 204
The assessees were not served with any notice under s192 which provides for a notice to be served personally on the assessee during the respective years nor under section 30 of the Act which deals with escaped assessment
The purchasers of the tea estate were served
in 1961 with assessment orders under section 204 in respect of the assessment years 1951 52 to 1955 56 with notices of demand for payment of the tax assessed for each year
These assessees were also not served with any notice under section 192 or section 30
All the assessees challenged the assessments in writ petitions and the High Court allowed the petitions
In appeal to this Court it was contended that the assessment proceedings commenced with the publication of a general notice under section 191 that it was open to the Agricultural Income tax Officer to make a best judgment assessment under section 204 without any limitation as to time and that it was not necessary to issue any individual notice under section 192 or to initiate proceedings under section 30
HELD Notwithstanding the difference in language between section 204 of the Act and section 234 of the Income tax Act the principles laid down by this Court in interpreting sections 22 23 and 34 of the Income tax Act apply in the interpretation of sections 19 20 and 30 the corresponding sections of the Assam Agricultural Income tax Act
788 A C On those principles the publication of the general notice in any financial year under section 191 of the Assam Act to furnish a return of one s agricultural income in the previous year does not initiate proceedings against an assessee unless such assessee files a return
If no return is made pursuant to the general notice under section 191 assessment could be made against an assessee under section 192 serving an individual notice on that assessee during that financial year
Once that financial year is over and no return has been made in response to the general notice under section 191 and no individual notice has been served under section 192 there would arise a case of escaped assessment and the only way to bring that income to tax is to initiate proceedings by a notice in accordance with section 30 within 3 years of 781 the end of that financial year
Since no such proceedings were initiated in the present case the assessment orders
were rightly quashed
787 E H The Commissioner of Income tax Bombay vs Ranchhodas Karsondas Bombay   Ghanshyam Das vs Regional Assistant Commissioner of Sales tax Nagpur  and The State of Assam vs Deva Prasad Barua 1969 1
SCR 698 followed