LAXMANAPPA HANUMANTAPPA JAMKHANDI versus THE UNION OF INDIA AND ANOTHER

MEHR CHAND MAHAJAN C.J.-This a petition under article 32 of the Constitution of India for the enforceme<J,t 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.

p. 770

The petition anses m 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 <lealt m cotton and money-lending also. All the brothers owned extensive properties, both agricultural and non-agricultural. Though prior to the assessment year 1926-27 all the brothers were assessed to incometax 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 Income-tax 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 part1t10n between them and they were carrymg 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.

p. 770

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 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 years 1940-41 and 1948-49. In pursuance of this report the ·Central Government passed an order undersection8(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 l\Iessrs 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 petitionerfor recovery of the tax assessed by the Income-tax Officer and in those proceed in gs 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 ofland was sold by public auction under-· the provisions of the Bombay Land Revenue Code.

pp. 770–771

On the 20th September, 1954, the -present application was preferredunder the provisions of article 32 of thq Constitution .. -It has perhaps been made under the. impression that the decision of this Court in Siiraj Mal ltlohta v. A. V. Visvanatha Sastri and Another(') 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(l)(f) of the Constitution. It was al~o alleged s.c. s~s that the proceedings before the Income-tax Investiga· . tion Commission after the coming into force of the Con· stitution were illegal as being in contravention of articles

pp. 771–772

14 and 20(3) of the Constitution and that in view of the India-decision of this Court inSuraj Mal lrfohta v. A. V.

p. 772

V isvanatha 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 section5(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 th_e 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 ..

p. 772

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 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 (') that as there is a special provision in article 265 of the Constitutbn that no tax shall be levied or collected except by authoi;ity of-Jaw, 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 th_at have arisen it would not be just and proper s.c'.R. to direct the issue of any of the writs the issue of which

pp. 772–773

discretionary with this Court. When this position was put to Mr. Sen, the learned counsel for the petitioner, he very fairly, and, in our opm10n, rightly conceded that it was not possible for him to com~at this position.

p. 773

For the reasons given above this petition is bound fail and it is accordingly dismissed with costs.

p. 773

Petition dismissed. DEWAN BAHADUR SETH GOPAL DAS MOHTA THE UNION OF INDIA AND ANOTHER. "· [MEHR CHAND MAHAJAN C.J., s. R. DAS, GH?LAM HASAN, BHAGWATI and VENKATARAMA AYYAR JJ.] (XXX

p. 773

proce~dings (£)

p. 773