1960 Present : T. S. Fernando, J.

W. I. S. FERNANDO, Appellant, and H. A. MITRASENA (Assessor,
Department of Inland Revenue), Respondent

S. C. 995-M. C. Colombo, 17978/B

Income tax-False statement in return made by a8sesse6-Return not one required to be made by the Ordinance--Scope of assessee's liability-Income Tax Ordinance (Oap.188), ss. 54 (1), (3) ,. 64 ,. 87 (1) (b).

An assessee, who had furnished in April 1953 a return of his income for the year of assessment 1952/53 as required by the Income Tax Ordinance and boon assessed thereon 'and paid the tax due on the assessment, sent another return in May 1954 in respect of the same year of assessment as a result of a request made by the assessor that another return be furnished as the earlier return had boon lost in his (the assessor's) office.

The assessee was charged with making a false statement in a return made under the Ordinance, viz., the return furnished in May 1954.

Held, that, as there was no provision of law which enabled the assessor to call for. another return from a person who had already furnished a return as required by the Ordinance, been assessed thereon and had paid the tax on such assessment, the return made in May 1954 was not one required to be made under the Ordinance, and therefore was not one made under the Ordinance within the meaning of section 87 (1) (b).

APPEAL from a judgment of the Magistrate's Court, Colombo.

G. T. Samerawickreme, with R. Bandaranayake, for the accused. appellant.

P. Colin Thome, Crown Counsel, for the Attorney-General.

Cur. adv. vult.

August 9,1960. T. S. FERNANDO, J.

The accused-appellant was charged in the Magistrate's Court on the charge reproduced below :

" That you did, within the jurisdiction of this Court at Colombo, between the 30th day of March 1954 and 27th day of May 1954, wilfully with intent to evade tax make a false statement or entry in the return furnished by you under the Income Tax Ordinance for the year of assessment 1952/53, to wit, by stating therein that your income from leasehold fibre mill, to wit, St. Mary's Fibre Mill, Wennappuwa, was Rs. 19,108/°5 whereas in fact such income was more than the said sum and have thereby committed an offence punishable under Section 87 (1) (b) of the Income Tax Ordinance (Cap. 188)."

After trial, the learned Magistrate convicted the appellant and sentenced him to pay a fine of Rs. 750. The appeal has been pressed both on facts and on law. In regard to the appeal on the facts, it is sufficient to observe that it is not possible for this Court to hold either that there was not adequate material before the learned Magistrate to warrant his finding that the appellant had understated his income from the fibre mill in question or that in reaching that finding he has misdirected himself.

The question of law raised is that the return in respect of which the charge was framed was not a return made under the Income Tax Ordinance and therefore does not attract the penalties specified in Section 87 of the said Ordinance. To appreciate the point of law raised it is necessary to state the facts involved in its consideration and examine the relevant provisions of the Ordinance.

Section 54 (1) enables an assessor to give notice in writing to any person requiring him to furnish within the time limited by such notice a return of his income containing such particulars and in such form as may be prescribed. It is admitted that the return in respect of the year of assessment 1952/53 was called for from the appellant and was furnished by him in April 1953. On the basis of this return the assessor acting under Section 64 assessed the tax payable by the appellant and this tax was duly paid. In 1954 the assessor

received from a third party certain information which prompted him to make investigations into the income of the appellant, and in the course of these investigations the assessor discovered that the