Civil Appeals Nos 942 and 943 of 1966
Appeals by special leave from the judgment and order dated june 18 1965 of the Kerala High Court in Writ Appeals Nos
139 and 140 of 1964
Jagdish Swarup Solicitor General TA Ramachandran and D Sharma for the appellant in both the appeals
ST Desai MC Chacko AK Verma JB Dadachanji and OC Mathur for respondent No 1 in CA No 942 of 1966
AG Pudissery for respondents Nos 2 and 3 in CA No 942 of 1966
JB Dadachanji for respondents Nos 1 and 2 in CA NO 943 of 1966
AG Pudissery for respondents Nos 7 and 8 in CA No 943 of 1966
The Judgment of the Court was delivered by Grover J
These two appeals by special leave involve a common question relating to the validity of a notification issued by the Government of Kerala in August 1963 empowering certain revenue officials including the Taluka Tahsildar to exercise the powers of a Tax Recovery Officer under the Income Tax Act 1961 hereinafter called the Act
The notification was expressly stated to be effective from 1st April 1962 a date prior to the date of the notification
The facts in one of the appeals CA 94266 may be stated One Kunchacko of Alleppey allowed the income tax dues from him to fall into arrears
The Income Tax Officer took steps to recover the arrears through the Tahsildar
Certain shares standing in the name of the assessee were attached by the Tahsildar
The first respondent Ponnoose claimed to have obtained a decree for a certain sum against the assessee
He also got the shares 680 standing in the name of the assessee attached in execution proceedings Ponnoose filed a petition under article 226 of the Constitution in the High Court of Kerala in which he challenged the action taken by the revenue officials including the Tahsildar for getting the shares which had been attached sold for satisfaction of the income tax dues of the assessee
The learned Single Judge held that the notification empowering the Tahsildar to exercise the powers of a Tax Recovery Officer under the Act with retrospective effect was invalid
Consequently  the attachments made by the Tahsildar were quashed
This view was affirmed by a division bench in appeal
The Act came into force on first April 1962
Section 244 defined the expression Tax Recovery Officer in the following
terms Tax Recovery Officer  means i a Collector ii an additional Collector or any other officer authorised to exercise the powers of a Collector under any law relating to Land revenue for the time being in force in a State or iii any gazetted officer of the Central or a State Government who may be authorised by the Central Government by notification in the Official Gazette to exercise the powers of a Tax Recovery Officer
Section 4 of the Finance Act 1963 substituted a new definition for the original definition of Tax Recovery Officer
It was provided that the new definition shall be and shall be deemed always to have been substituted
The new definition was as follows Tax Recovery Officer means i a Collector or an additional Collector ii any such officer empowered to
effect recovery of arrears of land revenue or other public demand under any law relating to land revenue or other public demand for the time being in force in the State as may be authorised by the State Government by general or special notification in the Official Gazette to exercise the powers of a Tax Recovery Officer iii any Gazetted Officer of the Central or a State Government who may be authorised by the Central Government by general or special noti 681 fication in the Official Gazette to exercise the powers of a Tax Recovery Officer
 The impugned notification dated August 14 1963 which was published in the Kerala Gazette dated August 20 1963 referred to the powers conferred by sub clause ii of clause 44 of section 2 of the Act read with sub rule 2 of rule 7 of the Income tax Certificate Proceedings Rules 1962 and authorised the various revenue officials mentioned therein including the Taluk Tahsildar to exercise the powers of a Tax Recovery Officer under the Act in respect of the arrears etc
The concluding portion was This notification shall be deemed to have come into force on the first day of April 1962
The Tahsildar had effected attachment of the shares subsequent to first April 1962 but prior to August 14 1963
In other words on the date on which he had effected attachment he was not a Tax Recovery Officer but he got the powers of a Tax Recovery Officer by virtue of the notification dated August 14 1963
The short question for determination therefore was and is whether the State Government could invest the Tahsildar with the powers of a Tax Recovery Officer under the aforesaid provisions of the Act with effect from a date prior to the date of the notification ie retroactively or retrospectively
Now it is open to a sovereign legislature to enact laws which have retrospective operation
Even when the Parliament enacts retrospective laws such laws are in the words of Willes J in Phillips vs Eyre1 no doubt prima facie of questionable policy and contrary to the general principle that legislation by which the conduct of mankind is to be regulated ought when introduced for the first time to deal with future acts and ought not to change the character of past transactions carried on upon the faith of the then existing law
 The courts will not therefore ascribe retrospectivity to new laws affecting rights unless by express words or necessary implication it appears that such was the intention of the legislature
The Parliament can delegate its legislative power within the recognised limits
Where any rule or regulation is made by any person or authority to whom such powers have been delegated by the legislature it may or may not be possible to make the same so as to give retrospective operation
It will depend on the language employed in the statutory provision which may in express terms or by necessary implication empower the authority concerned to make a rule or regulation with retrospective effect
But where no such language is to be found it has been held by the courts that the person or authority exercising subordinate legislative functions cannot make a rule regulation or bye law which can operate with retrospective effect see Subba Rao J in Dr lndramani Pyarelal Gupta vs W R Nathu  1 40 Law JRepNS QB 28 at p 37
682 Others1 the majority not having expressed any different opinion on the point Modi Food Products Ltd vs Commissioner of Sales Tax UP2 India Sugar Refineries Ltd vs State of Mysore3 and General section Shivdev Singh  Another vs The State of Punjab  Others4
it can hardly be said that the impugned notification promulgates any rule regulation or bye law all of which have a definite signification
The exercise of the power under sub clause ii of cl
44 of section 2 of the Act is more of an executive than a legislative act
It becomes therefore all the more necessary to consider how such an act which has retrospective operation can be valid in the absence of any power conferred by the aforesaid provision to so perform it as to give it retrospective operation
In Strawboard Manufacturing Co Ltd vs Gutta Mill Workers  Union5 an industrial dispute had been referred by the Governor to the Labour Commissioner or a person nominated by him with the direction that the award should be submitted not later than April 5 1950
The award however was made on April 13 1950
On April 26 1950 the Governor issued a notification extending the time up to April 30
It was held that in the absence of a provision authorising the State Government to extend from time to time the period within which the Tribunal or the adjudicator could pronounce the decision the State Government had no authority to extend the time and the award was therefore one made without jurisdiction and a nullity
This decision is quite apposite and it is difficult to hold in the present case that the Taluka Tehsildar could be authorised by the impugned notification to exercise powers of a Tax Recovery Officer with effect from a date prior to the date of the notification
It may next be considered whether by saying that the new definition
of Tax Recovery Officer substituted by section 4 of the Finance Act 1963 shall be and shall be deemed always to have been substituted it could be said that by necessary implication or intendment the State Government had been authorised to invest the officers mentioned in the notification with the powers of a Tax Recovery Officer with retrospective effect
The only effect of the substitution made by the Finance Act was to make the new definition a part of the Act from the date it was enacted
The legal fiction could not be extended beyond its legitimate field and the aforesaid words occurring in section 4 of the Finance Act 1963 could not be construed to embody conferment of a power for a retrospective authorisation by the State in the absence of any express 1  2 AIR 1956 All 35
2 AIR 1960 Mys 326 4 5  683 provision in section 244 of the Act itself
It may be noticed that in a recent decision of the Constitution Bench of this Court in B 8
vadera etc vs Union of India  Others1 it has been observed with reference to rules framed under the proviso to article 309 of the Constitution that these rules can be made with retrospective operation
This view was however expressed owing to the language employed in the proviso to article 309 that  any rules so made shall have effect subject to the provisions of any such Act
As has been pointed out the clear and unambiguous expressions used in the Constitution must be given their full and unrestricted meaning unless hedged in by any limitations
Moreover when the language employed in the main part of article 309 is compared with that of the proviso it becomes clear that the power given to the legislature for laying down the conditions is identical with the power given to the President or the Governor as the case may be in the matter of regulating the recruitment of Government servants and their conditions of service
The legislature however can regulate the recruitment and conditions of service for all times whereas the President and the Governor can do so only
till a provision in that behalf is made by or under an Act of the appropriate legislature
As the legislature can legislate prospectively as well as retrospectively there can be hardly any justification for saying that the President or the Governor should not be able to make rules in the same manner so as to give them prospective as welt as retrospective operation
For these reasons the ambit and content of the rule making power under article 309 can furnish no analogy or
parallel to the present case
The High Court was consequently fight in coming to the conclusion that the action taken by the Tahsildar in attaching the shares was unsustainable
The appeals therefore fail and are dismissed with costs
One hearing fee
YP Appeals dismissed


Summary:
By a notification dated August 14 1963 issued by the State of Kerala the Taluka Tehsildar was authorised to exercise the powers of a Tax Recovery Officer under the Income tax Act 1961
The notification was made effective from April 1962
The shares of the assessee who was in arrears of his income tax were
attached by the Taluka Tehsildar after April 1 1962 but prior to August 14 1963
A petition under article 226 of the Constitution was filed challenging the action of the Tehsildar
The High Court held that the notification empowering the Tehsildar to exercise the powers of a Tax Recovery Officer with retrospective effect was invalid and consequently quashed the attachments
This view was affirmed by the Division Bench in appeal
Dismissing the appeal by the Revenue this Court HELD The courts will not ascribe retrospectivity to new laws affecting rights unless by express words or necessary implication it appears that such was the intention of the legislature
The Parliament can delegate its legislative power within the recognised limits
Where any rule or regulation is made by any person or authority to whom such powers have been delegated by the legislature it may or may not be possible to make the same so as to give retrospective operation
It will depend on the language employed in the statutory provision which may in express terms or by necessary implication empower the authority concerned to make a rule or regulation with retrospective effect
But where no such language is to be found it has been held by the courts that the person or authority exercising subordinate legislative functions rule regulation or bye law 
which can operate with retrospective effect
681 F H It can hardly be said that the impugned notification promulgates any rule regulation or bye law all of which have a definite signification
The exercise of the power under sub cl
ii of cl
44 of section 2 of the Income tax Act 1961 is more of an executive than a legislative act
682 B Dr Indramani Pyarelal Gupta vs
WR Nathu  Ors   Strawboard Manufacturing Co Ltd vs Gutta Mill Workers   followed
Phillips vs Eyre 40 Law L Rep NS QB 28 at p 37 referred to
Modi Food Products Ltd vs Commissioner of Sales tax UPAIR 1956 All
35 India Refineries Ltd vs State of Mysore AIR 1960 Mys
326 and General 8
Shivdev Singh  Anr
v The State of Punjab  Ors  approved
679 By saying that new definition of Tax Recovery Officer substituted by section 1 of the Finance Act 1963 shall be and shall be deemed always to have been substituted was to make the new definition a part of the income Tax Act from the date it was enacted
The legal fiction could not be extended beyond its legiitimate field and the aforesaid words occurring in s4 of the Finance Act 1963 could not be construed to embody conferment of a power for retrospective authorisation by the State rethe absence of any express provision in section 244 of the Income Tax Act itself
682 G BS Vadera etc
vs Union of India  Ors   distinguished