The State of Uttar Pradesh & Ors Vs.
Raja Syed Mohammad Saadat Ali Khan [1960] INSC 115 (28 July 1960)
SHAH, J.C.
DAS, S.K.
HIDAYATULLAH, M.
CITATION: 1960 AIR 1283
ACT:
Agricultural Income-tax--Additional
Collector--Power of Assessment--Amending Act giving retrospective effect to
amended Provisions--Provision for review in the amendment Act--If affects the
powers of the appellate court--The United Provinces Agricultural Income-tax
Act, 1949 (U. P.
III of 1949)--United Provinces Land Revenue Act, 1901 (U.P. III of 1901).
HEADNOTE:
The United Provinces Agricultural Income-tax
Act, 1949, authorised imposition of a tax on agricultural income within the
State, and the agricultural income-tax and super-tax were charged on the total
agricultural income of the previous year of the assessee. For the purposes of
the Act the Collector and the Assistant Collector were declared to be the
assessing authorities within their respective revenue jurisdiction and the
expression " Collector " was to have the same meaning as in the
United Provinces Land Revenue Act, 1901. Under the rules framed by the
government under s. 44 of the Act an assessee having agricultural income in the
jurisdiction of more than one assessing authority was to be assessed by the
Collector of the district in which he permanently resided. The State Government
of Uttar Pradesh appointed Mr. K. C. Chaudhry under subS. 1 of S. 14(A) of the
United Provinces Land Revenue Act, 1901 to be the Additional Collector in
District Bahraich and authorised him to exercise all the powers and perform all
the duties of a Collector in all classes of cases ". Claiming to exercise
the 83 powers of a Collector under S. 14 of the United Provinces Agricultural
Income-tax Act of 1949 he assessed the net agricultural income of the assessee
who owned landed property in two districts, namely, Bahraich and Kheri in the
State of Uttar Pradesh, at 12,81,110-10-0 and ordered him to pay Rs.
1,36,390-2-0 as agricultural income-tax and super- tax. The validity of this
order was challenged by the assessee in the High Court by an application under
Art. 226 of the Constitution and the High Court quashed the order of the
Additional Collector holding that he had no " extra- territorial "
jurisdiction which was exercised by the Collector as the assessing authority in
cases where the property of the assessee was situate in several districts and
as such the proceeding taken by him for assessing agricultural income-tax was
unauthorised. After the judgment of the High Court was delivered the State
Legislature amended the United Provinces Agricultural Income-tax Act, 1949, by
Act XIV of 1956, giving retrospective operation to the amending provisions. The
Amendment Act enacted that the assessment proceedings held by an Additional
Collector who was invested with the powers of a Collector under Act III of 1901
should be deemed always to have been properly taken. The State Government
submitted before the High Court an application under s. 11 of the amending Act
for review of its judgment but it was dismiss- ed. On appeal by the State
Government by special leave, Held, that the Additional Collector was competent
to assess the liability of the assessee to pay agricultural income-.tax and
super-tax under the United Provinces Agricultural Income-tax Act, 1949.
A Court of appeal must give effect to the law
as it stood at the time of hearing of the appeal if at any stage anterior to
the hearing the law had been amended with retrospective effect conferring on an
authority or tribunal from the order whereof the appeal is filed, jurisdiction
which it originally lacked.
The power of the appellate court to deal with
the appeal in accordance of the amended law is not affected by a provision for
review as contained in s. 11 of the Amending Act.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 306 of 1957.
Appeal from the judgment and order dated
April 28, 1955, of the Allahabad High Court (Lucknow Bench), Lucknow, in Civil
Misc. Application No. 59 of 1954.
C. B. Agarwala, C. P. Lal and G. N. Dikshit,
for the appellants.
S. P. Sinha and B. R. L. Iyengar, for the
respondent.
1960. July 28. The Judgment of the Court was
delivered by 84 SHAH' J.-Raja Syed Mohammad Saadat Ali Khan, who will
hereinafter be referred to as " the assessee ", is the owner of
Taluqa Nanpura in district Bahraich and Taluqa Mohammadi in district Kheri, in
the State of Uttar Pradesh. The legislature of the United Provinces enacted the
United Provinces Agricultural Income-tax Act, Act III of 1949, authorising
imposition of a tax on agricultural income within the State. By s. 3 of the
Act, the liability to pay agricultural income-tax and super-tax at rates
specified in the schedule therein was charged on the total agricultural income
of the previous year of every person. By s. 14, the Collector and the Assistant
Collector were for the purposes of the Act declared to be the assessing
authorities within their respective revenue jurisdictions. As originally
enacted, by s. 2(4), the expression " Collector " was to have the
same meaning as in the United Provinces Land Revenue Act, 1901. By s. 44, the
Provincial Government was empowered to make rules for carrying out the purposes
of the Act, and in particular, amongst others, " to prescribe the
authority by whom and the place at which assessment shall be made in the case
of assessee having agricultural income in the jurisdiction of more than one
assessing authority " By r. 18, el. 1(a), framed by the Government, in
exercise of the powers under s. 44, it was provided, in so far as it is material,
that subject to sub-s. 2 of s. 14, an assessee shall ordinarily be assessed
by...... the Collector of the district in which he permanently resides.
The State Government of Uttar Pradesh (the
former United Provinces) by Notification dated June 8, 1953, appointed one K.
C. Chaudhry under sub-s. 1 of s. 14(A) of the United Provinces Land Revenue Act
III of 1901 to be the Additional Collector in district Bahraich and authorised
him to exercise all the powers and perform all the duties of a Collector "
in all classes of cases ". Claiming to exercise the authority of the
Collector tinder s. 14 of Act III of 1949, the Additional Collector by order
dated February 25, 1954, assessed the assessee's net agricultural income at Rs.
2,81,110-10-3 and ordered him to pay Rs. 1,36,390-2-0 as agricultural
income-tax and super-tax.
85 The validity of this order was challenged
by the assessee by an application under Art. 226 of the Constitution presented
before the High Court of Judicature at Allahabad. The contention of the
assessee that the Additional Collector of Bahraich was not an authority
competent bylaw to assess the agricultural income-tax under Act III of 1949 was
upheld by the High Court. The High Court issued a writ of certiorari quashing
the order of the Additional Collector, because in its opinion, where property
of an assessee is situate in several districts, the Collector as the assessing
authority under Act III of 1949 exercises "extra-territorial"
jurisdiction, but as K. C. Chaudury, the Additional Collector was not invested
with that extraterrestrial jurisdiction, the impugned proceeding assessing
agricultural income-tax was unauthorised. The State of Uttar Pradesh obtained
from the High Court leave to appeal to this court against the order quashing the
assessment.
On behalf of the State of Uttar Pradesh, it
is urged that an Additional Collector by virtue of s. 14(A) of the United
Provinces Land Revenue Act III of 1901, is competent to exercise all such
powers and perform all such duties of a Collector in cases or classes of oases
as the State Government may direct, and the State Government having invested
Mr. Chaudhri the Additional Collector with authority to exercise all the powers
and to perform all the duties of a Collector " in all classes of cases
", that officer could exercise the powers of the Collector under Act III
of 1901, including, what the High Court called the " extraterritorial
" powers. It is unnecessary to express any opinion on this argument,
because the legislature of the State of Uttar Pradesh, has, since the judgment
delivered by the High Court in this group of cases, amended the United
Provinces Agricultural Income tax Act (U. P. Act III of 1949) by Act XIV of
1956, giving retrospective operation to the amending provisions. By the
amendment, cl. 4 of s. 2 of the original Act, has been substituted by two
clauses, cl. 4 and cl. 4-a, and el. 4-a enacts that the expression "
Collector " shall have and shall be deemed always to have 86 the meaning
as in the U. P. Land Revenue Act, 1901 and will include an Additional Collector
appointed under the said Act. By s. 10(1)(b), all orders made, actions or
proceedings taken, directions issued or jurisdictions exercised under or in
accordance with the provisions of the Principal Act or of any rule an framed there
under prior to the amendment of that Act are to be deemed always to be as good
and valid in law as if the amending Act had been in force at all material
dates. By s. 10, sub-s. 1(a), of the amending Act, it is provided that in r. IS
of the U. P.
Agricultural Income Tax Rules, 1949, the
expression " Collector " shall be deemed to have included an
Additional Collector: and it is enacted by sub-s. 2 of that section that where
any question arose as to the validity or legality of any assessment made by an
Additional Collector in purported exercise of the powers under s. 14 or of the
rules framed under cl. (o) of sub-s. 2 of s. 44 of Act III of 1949, the same
shall be determined as if the provisions of this amending Act had been in force
at all material dates. By the amending Act, the legislature has enacted in
language which is clear and explicit that assessment proceedings held by an
Additional Collector who is invested with the powers of a Collector under Act
III of 1901 shall be deemed always to have been properly taken.
This court is seized of an appeal from the
order of the High Court quashing the assessment on the ground that the
Additional Collector had no extra-territorial authority to assess agricultural
income-tax. It is true that Act III of 1949 was amended after the High Court
delivered its judgment; but in dealing with this appeal, we are bound to
consider the amended law as it stands today (and which must be deemed to have
so stood at all material times) and to give effect to it, having regard to the
clearly expressed intention of the legislature in the amended provisions.
Accordingly we hold that the Additional
Collector was competent to assess the liability of the assessee to pay
agricultural income-tax and super-tax under the United Pro- vinces Agricultural
Income-tax Act III of 1949.
For the assessee, it is contended that before
the 87 High Court an application for review of judgment was submitted by the
State Government under s. 11 of the amending Act, and the High Court having rejected
that application and no further proceeding having been initiated in this court
challenging the correctness of that decision, it is not open to us to set aside
the judgment under appeal.
In support of this plea, it is urged that an
application for review of judgment is the only remedy available to a person
aggrieved by a decision of a court or authority for rectification of an order
inconsistent with the provisions of the amending Act, and if, for any reason,
that application for review is not filed or is filed and rejected, it is not
open to a court or authority exercising appellate powers against that decision
to adjudicate the dispute in the light of the amending Act.
Section 11 in so far as it is material,
provides:
" Where before the commencement of this
Act, any court or authority has, in any proceedings under the Principal Act,
set aside any assessment made by an Additional Collector merely on the ground
that the assessing authority had no jurisdiction to make the assessment, any
party to the proceedings may, at any time, within ninety days from the
commencement of the Act apply to the court or authority for a review of the
proceedings in the light of the provisions of this Act, and the court or
authority to which the application is made, shall review the proceedings
accordingly ".
Relying on s.. 11, the State of Uttar
Pradesh, it is true did submit an application for review of the judgment of the
High Court and the High Court rejected that application observing, "That
section (s. 1 1) applies however only to cases in which the assessment has been
set aside in any proceedings under the Principal Act. In the cases before us,
the assessment has not been set aside in any proceedings under the Principal
Act but in exercise of the jurisdiction vested in this court under Art. 226 of
the Constitution. These three petitions are therefore not
maintainable................" We need express no opinion on the
correctness of 88 this view, because in our judgment, the contention of the
assessee that for setting aside an adverse order inconsistent with the
provisions of the amending Act of 1956, a proceeding for review under s. 11 is
the only remedy which is open to an aggrieved party, is without force. A court
of appeal,, in an appeal properly before it, must give effect to the law as it
stands if the law has at some stage anterior to the hearing of the appeal been
amended retrospectively with the object of conferring upon the authority or
tribunal of first instance from the order whereof the appeal is filed jurisdiction
which it originally lacked: and a provision for review like the one contained
in s. 11 of the amending Act does not affect the power of the appellate court
to deal with the appeal in the light of the amended law.
In the view expressed by us, this appeal must
be allowed.
As the appellant succeeds relying on a
statute which was enacted after the date of the judgment of the High Court, we
direct that there shall be no order as to costs.
Appeal allowed.
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