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J. C. SHAH, J. R. MUDHOLKAR, K. N. WANCHOO, P. B. GAJENDRAGADKAR, S. M. SIKRI
S. A. L. Narayan Row – Appellant
Versus
Ishwarlal Bhagwandas, Vrajlal Kewaldas – Respondent
Key Points: - The judgment holds that "civil proceeding" includes proceedings before the High Court under Art. 226 seeking relief against infringement of civil rights by revenue authorities and is capable of certification under Art. 133(1) (!) (!) (!) . - It discusses the grounds for certifying an appeal under Article 133(1), including that the case involves a question of law as to interpretation of the Constitution, and that revenue/tax-related proceedings can be civil proceedings eligible for certification (!) (!) (!) . - It analyzes the retrospective operation of the fifth proviso to S. 18-A(6) and Rule 48, and how these affect the legality of penalties and the authority to rectify assessments under S. 35, including the view that omissions to charge interest could be rectified retroactively when the proviso and rules are considered (!) (!) (!) (!) . - The High Court’s quashing of the rectification order under S. 35 was set aside by the majority, which held the assessment could be rectified in light of the proviso and retrospective rules (!) (!) . - The appeals were dismissed with costs (majority view) regarding the certification and merits of quashing the rectification order (!) (!) . - The judgment clarifies that civil rights enforcement against revenue actions constitutes a civil proceeding for Art. 133 purposes (!) (!) .
Judgment
SHAH, J. (For himself and Gajendragadkar C.J.I. and Wanchoo and Sikri JJ.): The 1st income-tax officer, C-II Ward, Bombay served a notice under S. 18-A(1) of the Indian income-tax Act, 1922 calling upon Bhagwandas Kevaldas -who will hereinafter be called the assessee to pay in four equal instalments Rs. .25,973/5/as advance-tax for the assessment year 1948-49. On September 17, 1947 the assessee filed an estimate of his income under S. 18-A 2. and of the tax payable by him, and on January 10, 1948 he filed a revised estimate. An order under S. 28-B of the Act provisionally assessing the income was made by the Income-tax Officer and pursuant thereto on August 28, 1950 the assessee paid the tax so assessed. Regular assessment of the income of the assessee was made on March 31, 1958 by the Income-tax Officer, and it was found that the tax paid on the basis of the estimate of the assessee was less than eighty per cent of the tax determined as a result of the regular assessment. But the Income-tax Officer made no charge for interest under sub-section (6) of S. 18-A of the Income-tax Act.
2. The departmental auditor raised an objection in auditing accounts of C-II Ward that a mista
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