Case: Nathmal Tolaram Vs. Superintendent Of Taxes, Dhubri And Another

1. Whether, in view of the aforesaid facts and circumstances the turnover from 20,515 maunds of jute mentioned under item (i) is taxable under the Act ?      2. Whether, in view of the aforesaid facts and circumstances the turnover from 5,500 maunds of jute mentioned under item (ii) is taxable under the Act ?      2. In respect of each of the three questions 1 to 3, the High Court recorded the following answer :"Not being a sale within the meaning of sub-sec3. The High Court, however, observed :"As to whether these consignments can hereafter be assessed if they fall within the purview of the Explanation to sub-sec. (12) of S. 2, we express no opinion."4. As required by S. 32(8) of the Act, the Commissioner of Taxes by his order dated August 1, 1952, directed the Superintendent of Taxes to dispose of the case in accordance with the judgment of the High Court. The Superintendent of Taxes thereafter issued on January 30, 1953, the following notice to the appellants :5. By their letter dated March 23, 1953, the appellants called upon the Commissioner of Taxes to direct the Superintendent of Taxes not to proceed with the notice. The Commissioner having failed to direct as requested, the appellant petitioned the High Court in Assam under Art. 226 of the Constitution for a writ prohibiting the Superintendent of Taxes from re-opening and proceeding with the assessment of the appellants under the Assam Sales Tax Act and for a writ quashing the order dated August 1, 1952, passed by the Commissioner. The High Court summarily dismissed the petition. Against the order passed by the High Court, this appeal is filed with special leave under Art. 136 of the Constitution.

Reasoning: 8. The principle of this case has in our judgment no application to the present case. The High Court at Bombay in its advisory jurisdiction had declared the assessment already made to be illegal. But the Commissioner was under S. 33 of the Indian Income Tax Act invested with jurisdiction to direct further enquiry, and he purported to exercise that jurisdiction. The Privy Council rejected the challenge to the exercise of that jurisdiction. In the present case, no proceedings were started by the Commissioner of Taxes in exercise of his revisional authority. The Commissioner of Taxes had directed the Superintendent of Taxes merely to dispose of the case according to the judgment of the High Court, and the Superintendent had to carry out that order. If he was competent - and on that question, we express no opinion - he could if the conditions precedent to the exercise of his jurisdiction existed, proceed to reassess the appellants. But the proceedings for reassessment were clearly barred because the period prescribed for reassessment had expired. The Superintendent therefore had no power to issue a notice calling upon the appellants to produce evidence to enable him to start an enquiry which was barred by the expiry of the period of limitation prescribed by the Act. In the Bombay Trust Corporation case (supra), the Income Tax Officer acted in pursuance of the direction of the Commissioner lawfully given in exercise of revisional authority and reopened the assessment. In the present case, no such direction has been given by an authority competent in that behalf : and the Superintendent had no power to reassess the income under S. 19 assuming that the section applied to a case where the assesse though registered had failed to include his sales in a particular commodity in his turnover, because the period of limitation prescribed in that behalf had expired.