Peiris V. Commissioner Of Inland Revenue

1963 Present : Sansoni, J.

L. C. H. PEIRIS, Appellant, and THE COMMISSIONER
OF INLAND REVENUE, Respondent

S. C. 596/63, with Application 390-M. C. Kalutara, 47649

    Income Tax Ordinance (Cap. 188)-Additional assessments-Wrong section quoted by Commissioner in support-Proceedings for recovery-Validity of certificate issued to Magistrate-Sections 64 (2) (a), 64 (2) (b), 65, 68 (1), 80 (1), 85.

Where, having accepted an assessee's return and made an assessment in terms of section 64 (2) (a) of the Income Tax Ordinance (Cap. 188), the Commissioner subsequently purports to make additional assessments under section 64 (2) (6) when the correct procedure is to make them under section 65, a certificate issued to the Magistrate in recovery proceedings under section 80 (1) is not invalidated by the Commissioner's mistake. Besides, in such a case, the assessee must seek his redress by way of appeal before the authorities set up by the Ordinance.

" It is well-settled that an exercise of a power will be referable to a jurisdiction which confers validity upon it and not to a jurisdiction under which it will be nugatory. This principle has been applied even to cases where a Statute which confers no power has been quoted as authority for a particular act, and there was in force another Statute which conferred that power. "

APPEAL, with application in revision, from a judgment of the Magistrate's Court, Kalutara.

N. E. Weerasooria, Q. C., with N. B. Weerasooria (Jnr.), for the Appellant.

F. C. Gunatilaka, Crown Counsel, for the Respondent.

Cur. adv. vult.

December 9, 1963.   SANSONI, J.-

The Assistant Commissioner of Inland Revenue, acting under section 80 (1) of the Income Tax Ordinance, Cap. 188, issued a certificate to the Magistrate certifying that the appellant (who has also applied in revision) had made default in the payment of Rs. 254,745 being income tax due from him. Summons was issued on the defaulter who showed cause against the tax being recovered.
After inquiry, the appellant was fined the amount of the tax under section 85 ; in default he was ordered to undergo a term of six months ' simple imprisonment. He has appealed and filed an application in revision.

It transpired in the course of the inquiry that the appellant had origi­nally been assessed in respect of three consecutive years, and the dispute was whether the three additional assessments made and served on the

appellant in respect of those three years were legal or not. In making those additional assessments the Assistant Commissioner in each case pur­ported to act in terms of Section 64 (2) (b) Cap. 188, which enables an assessor, if he does not accept a return of income furnished by a person, to estimate the amount of the assessable income of such person and assess him accordingly. The Assistant Commissioner was wrong when he pur­ported to act under Section 64 (2) (b), for he had accepted the return and made an assessment in terms of section 64 (2) (a). The correct procedure would have been for him to act under section 65 and make an additional assessment on the basis that the former assessment was less than the proper amount.

The learned Magistrate thought that section 65 did not apply and that the assessor could have acted under section 64 (2) in the circumstances of this case. With respect, I am unable to agree. But it still remains to be considered whether the certificate issued under section 80 (1) is invalidated by the mistake which the Assistant Commissioner made. In my opinion it is not. It is well-settled that an exercise of a power will be referable to a jurisdiction which confers validity upon it and not to a jurisdiction under which it will be nugatory. This principle has been applied even to cases where a Statute which confers no power has been quoted as authority for a particular act, and there was in force another Statute which conferred that powe

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