Case: Kr. Jyoti Sarup and Another Vs. Board of Revenue, U. P

and by the substantive part of sub-section (1) gives the assessee an option to adopt any one of the two methods; then comes the proviso which says that once the option is exercised, there can be no variation without the permission of the Board of Revenue. The appellants are seeking to read the words "in any one year" after the word "computation" in the proviso, and this they cannot be allowed to do. The scheme of the Act is that every assessee has to furnish a return by a prescribed date and once he has furnished the return, he can, under sub-section (4) of section 15, only correct the mistakes or fill in the omissions in the return and for that purpose submit a revised return; he has been given no right to vary the method of computation after he has filed a return for the year of assessment. If the proviso gave such a right of variation within the assessment year, one would expect this to be mentioned in section 15 (4). On the interpretation sought to be put upon the proviso by the appellants, there would be a conflict between the proviso and section 15 (4) of the Act. 8. On behalf of the appellants our attention has been drawn to the proviso to section 2 (11) (i) (a) and section 13 of the Indian Income- tax Act, 1922. We do not think that these provisions help us to determine the true scope and effect of the proviso to sub section (1) of section 6 of the Act. For one thing, the language is different; for another, the scheme and purpose of these different provisions is also not the same. Section 13 of the Income-tax Act refers to the method of accounting regularly employed by the assessee, and no question of option arises therein. The proviso to sub-clause (i) (a) of section 2 (11) enacts that once an assessee has been assessed in respect of a business, profession or vocation newly set up an assessee has exercised the option under sub-clause (c) although no assessment may have yet been made or could have been made as a result of the exercise of the option, the assessee cannot in respect of that source, business, profession or vocation change his previous year except with the consent of the Income-tax Officer and upon such conditions as the Income-tax Officer may impose. We do not see how this provision helps the appellants in the construction they are seeking to put upon the proviso to sub-section (1) of section 6 of the Act. 9. Next, it has been argued that the Board of Revenue did not apply its mind when it refused permission to the appellants. It appears that the application of the appellants was noted on by an officer of the Board of Revenue; this note was put up to the Deputy Secretary to the Board, who endorsed the note, with his own opinion, to the Senior Member of the Board. B. V. Bhadkamkar, who was then the Senior Member of the Board, signed below the endorsement of the Deputy Secretary in token of his approval of the orders proposed. The note stated that though the multiple method was easier and non-controversial, in some cases the assessee wanted a variation in order to reduce the amount payable to Government as tax in any one year. The administrative difficulties of such a variation were adverted to in the note. It is submitted that the Senior Member of the Board merely signed the note; he did not indicate what reasons led him to refuse permission to the appellants. The High Court has pointed out that when a senior officer signs a note submitted to him, it shows that he approves of it. In these circumstances we are unable to accept the contention that the Board failed to apply its mind when permission to vary the method of computation was refused to the appellants; on the contrary, the note shows that all the relevant considerations were kept in mind. 10. Lastly, it has been contended that the proviso to sub-section (1) of section 6 gives an unfettered discretion to the Board to give or refuse permission, and lays down no principles for its guidance; therefore, the proviso is capable of discriminatory application and is violative of the guarantee of equal protection of the laws in article 14 of the Constitution. We are unable to accept this contention as correct. In Matajog Dobey v. H. C. Bhari and Ram Krishna Dalmia v. Shri S.R. Tendolkar this court had said that a discretionary power is not necessarily a discriminatory power and that abuse of power is not to be easily assumed where the discretions confided not to a petty official but to a high authority. Moreover, it appears to us that the provisions of section 6 themselves provide sufficient guidance to the Board of Revenue for the exercise of its discretion under the impugned proviso. These provisions lay down two alternative methods, with their advantages and disadvantages; the assessee has initially an option to choose one of the two methods; but once he has done so, he cannot vary it without the permission of the Board. Obviously, the Board in the exercise of its discretion must act reasonably and must take into consideration the relevant factors including the difficulties which a variation in the method of computation will give rise to. We do not, therefore, think that the discretion vested in the Board is per se discriminatory. 11. The appellants have asked for permission to adduce additional evidence at this stage in order to show that the Board had given permission to vary the method of computation in certain other case. The facts of those cases are not known to us, nor are we sitting in appeal over the Board of Revenue so that we may embark on an examination of the facts of each case. Accordingly, we have refused the permission asked for by the appellants.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]7. We are in agreement with the view, expressed by the High Court. It is indeed true, as has been pointed out by learned counsel for the appellants, that the Act like the Indian Income-tax Act, 1922, contemplates as assessment for each year on the income of the previous year. That does not necessarily mean that the restriction imposed by the proviso to sub-section (1) of section 6 is limited to one year only. The proviso must be construed with reference to the language used and the scheme of section 6. That section mentions two alternative methods of computation, and by the substantive part of sub-section (1) gives the assessee an option to adopt any one of the two methods; then comes the proviso which says that once the option is exercised, there can be no variation without the permission of the Board of Revenue. The appellants are seeking to read the words "in any one year" after the word "computation" in the proviso, and this they cannot be allowed to do. The scheme of the Act is that every assessee has to furnish a return by a prescribed date and once he has furnished the return, he can, under sub-section (4) of section 15, only correct the mistakes or fill in the omissions in the return and for that purpose submit a revised return; he has been given no right to vary the method of computation after he has filed a return for the year of assessment. If the proviso gave such a right of variation within the assessment year, one would expect this to be mentioned in section 15 (4). On the interpretation sought to be put upon the proviso by the appellants, there would be a conflict between the proviso and section 15 (4) of thedo not think that these provisions help us to determine the true scope and effect of the proviso to sub section (1) of section 6 of thedo not see how this provision helps the appellants in the construction they are seeking to put upon the proviso to sub-section (1) of section 6 of theappears that the application of the appellants was noted on by an officer of the Board of Revenue; this note was put up to the Deputy Secretary to the Board, who endorsed the note, with his own opinion, to the Senior Member of the Board. B. V. Bhadkamkar, who was then the Senior Member of the Board, signed below the endorsement of the Deputy Secretary in token of his approval of the orders proposed. The note stated that though the multiple method was easier and non-controversial, in some cases the assessee wanted a variation in order to reduce the amount payable to Government as tax in any one year. The administrative difficulties of such a variation were adverted to in theHigh Court has pointed out that when a senior officer signs a note submitted to him, it shows that he approves of it. In these circumstances we are unable to accept the contention that the Board failed to apply its mind when permission to vary the method of computation was refused to the appellants; on the contrary, the note shows that all the relevant considerations were kept inare unable to accept this contention asit appears to us that the provisions of section 6 themselves provide sufficient guidance to the Board of Revenue for the exercise of its discretion under the impugned proviso. These provisions lay down two alternative methods, with their advantages and disadvantages; the assessee has initially an option to choose one of the two methods; but once he has done so, he cannot vary it without the permission of the Board. Obviously, the Board in the exercise of its discretion must act reasonably and must take into consideration the relevant factors including the difficulties which a variation in the method of computation will give rise to. We do not, therefore, think that the discretion vested in the Board is per sefacts of those cases are not known to us, nor are we sitting in appeal over the Board of Revenue so that we may embark on an examination of the facts of each case. Accordingly, we have refused the permission asked for by the appellants.