Laxmanappa Hanumantappa Jamkhandi Vs.
The Union of India & ANR  INSC 98 (21 October 1954)
MAHAJAN, MEHAR CHAND (CJ) DAS, SUDHI RANJAN
HASAN, GHULAM BHAGWATI, NATWARLAL H.
AIYYAR, T.L. VENKATARAMA
CITATION: 1955 AIR 3
CITATOR INFO :
F 1957 SC 397 (43) R 1959 SC 149
(16,30,51,52) R 1959 SC 395 (28) RF 1961 SC 65 (5,37) HO 1961 SC1457 (6) RF
1962 SC1006 (34,72,81) O 1962 SC1563 (15) R 1962 SC1621 (122,165) R 1966 SC 619
(7) R 1970 SC 470 (33) RF 1971 SC 870 (10)
Constitution of India, Arts. 31(1), 32,
265-Deprivation of property-Otherwise than by imposition or collection of
tax-Right conferred by Art. 265Whether can be enforced by Art. 32.
Held, that as there is a special provision in
Art. 265 of the Constitution that no tax shall be levied or collected except by
authority of law, clause (1) of Art. 31 must be regarded as concerned with
deprivation of property otherwise than by the imposition or collection of tax
and as the right conferred by Art. 265 is not a fundamental right conferred by
Part III of the Constitution, it cannot be enforced under Art. 32.
Ramjilal v. Income-tax Officer, Mohindergarh
( S.C.R. 127) followed.
Suraj Mal Mohta and Co. v. A. V. Visvanatha
Sastri (A.i.R. 1954 S.C. 545) referred to.
ORIGINAL JURISDICTION: Petition No. 492 of
Petition under article 32 of the Constitution
for the enforcement of Fundamental Rights.
B. Sen, I. N. Shroff and B. P. Singh for the
M. C. Setalvad, Attorney-General for India, and C. K. Daphtary, Solicitor-General for India (G. N. Joshi 770 P.A. Mehta and P.
G. Gokhale, with them) for the respondents.
1954. October 21. The Judgment of the Court
was delivered by MEHR CHAND MAHAJAN C.J.-This is a petition under article 32 of
the Constitution of India for the enforcement of fundamental rights under
articles 31(1) and 19(1)(f) of the Constitution and for the issue of writs in
the nature of mandamus and/or certiorari and for suitable directions
restraining the respondents from interfering with the petitioner's properties
in violation of his fundamental rights.
The petition arises in these circumstances.
The petitioner, along with his brothers, used to carry on the business of toddy
and liquor vendors. In addition to this, one of the brothers used to run a bus
service and dealt in cotton and money-lending also. All the brothers owned
extensive properties, agricultural and nonagricultural. Though prior to the
assessment year 1926-27 all the brothers were assessed to income-tax as a Hindu
undivided family, since then up to the year 1946 they were assessed separately
on account of a partition alleged to have been made between them. In December,
1946, the Incometax Officer commenced proceedings against them under section 34
on the ground that the case of partition set up by them was not correct and as
a matter of fact there had been no partition between them and they were
carrying on business jointly. As a result of these proceedings an assessment
under section 34 was made on the four brothers jointly, treating them as an
association of persons, for the year 1942-43. Similar assessment proceedings
were taken against them in respect of the years 1940-41, 1941-42 and 1943-44.
In December, 1947, the Central Government,
under the bona fide belief that the petitioner's brothers had made huge profits
during the war and had evaded tax, made five references to the Income-tax
Investigation Commission under section 5(1) of the Taxation on Income
(Investigation Commission) Act, 1947. Reference No. 175 concerned all the
brothers as an association of persons while the other four references related
771 to the brothers individually. As a result of the proceedings before the
Investigation Commission, the Commission made a report to the Central
Government on the 26th of September, 1952, estimating the amount of escaped
income at Rs. 16,79,203 between the year,% 1940-41 and 1948-49. In pursuance of
this report the Central Government passed an order under section 8(2) of the
Taxation on Income (Investigation Commission) Act directing that the assessment
proceedings be taken under the Indian Income-tax Act and Excess Profits Tax
Act, 1940, as well as under the Business Profits Tax Act, 1947, against Messrs
Jamkhandi Bros. as an association of persons with a view to assess or reassess
the income that had escaped assessment according to the report of the
Investigation Commission. In accordance with these orders the Income-tax
Officer commenced proceedings against Messrs Jamkhandi Bros. as an association
of persons. On the 30th November, 1953, various assessment orders were passed
by the Income-tax Officer assessing the petitioner under the Income-tax Act and
the Excess Profits Tax Act. Proceedings were then taken against the petitioner
for recovery of the tax assessed by the Income-tax Officer and in those
proceedings the properties of the petitioner in the District of Belgaum were
attached for payment of the dues and one of his properties comprising of about
12 plots of land was sold by public auction under the provisions of the Bombay
Land Revenue Code.
On the 20th September, 1954, the present application was preferred under the provisions of article 32 of the Constitution.
It has perhaps been made under the impression that the decision of this Court
in Suraj Mal Mohta v. A. V. Visvanatha Sastri and Another (1) has application
to the facts and circumstances of this case as well and that relief can be
obtained against the assessment orders which have become final, by taking
proceedings under article 32 of the Constitution. In the petition it was
alleged that the attachment and sale of the petitioner's properties was illegal
and violates the petitioner's fundamental rights under articles 31(1) and
19(1)(f) of the Constitution. It was also alleged (1) A.I.R. 1954 S.C. 545.
772 that the proceedings before the
Income-tax Investigation Commission after the coming into force of the
Constitution were illegal as being in contravention of articles 14 and 20(3) of
the Constitution and that in view of the decision of this Court in Suraj Mal
Mohta v. A. V. Visvanatha Sastri and Another (supra) proceedings under the
Taxation on Income (Investigation Commission) Act, 1947 were discriminatory and
that the references made by the Central Government under section 5(1) are not
based on a proper classification. It was prayed that this Court may be pleased
to issue a writ in the nature of mandamus and/or certiorari or such other
directions as may be appropriate to quash the assessment orders made in
pursuance of the order of the Central Government under section 8(2) of the
Taxation on Income (Investigation Commission) Act, 1947, and to restrain the
respondents from attaching and selling or interfering in any manner with the
properties of the petitioner.
From the facts stated above it is plain that
the proceedings taken under the impugned Act XXX of 1947 concluded so far as
the Investigation Commission is concerned in September, 1952, more than two
years before this petition was presented in this Court. The assessment orders
under the Income-tax Act itself were made a against the petitioner in November,
1953. In these circumstances we are of the opinion that he is entitled to no
relief under the provisions of article 32 of the Constitution. It was held by
this Court in Ramjilal v. Income-tax Officer, Mohindergarh (1) that as there is
a special provision in article 265 of the Constitution that no tax shall be
levied or collected except by authority of law, clause (1) of article 31 must
therefore be regarded as concerned with deprivation of property otherwise than
by the imposition or collection of tax, and inasmuch as the right conferred by
article 265 is not a right conferred by Part III of the Constitution, it could
not be enforced under article 32. In view of this decision it has to be held
that the petition under article 32 is not maintainable in the situation that
has arisen and that even otherwise in the peculiar circumstances that have
arisen it would not be just and proper (1)  S.C.R. I27 773 to direct the
issue of any of the writs the issue of which is discretionary with this Court.
When this position was put to Mr. Sen, the learned counsel for the petitioner,
he very fairly, and, in our opinion, rightly conceded that it was not possible
for him to combat this position.
For the reasons given above this petition is
bound to fail and it is accordingly dismissed with costs.