# ' ' . - ', A. THANGAL KUNJU MUSALIAR v. M. VENKITACHALAM.POTTI AND ANOTHER

- **Citation:** [1955] 2 S.C.R. 1196
- **Court:** Supreme Court of India
- **Decided:** 1955
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/a-thangal-kunju-musaliar-v-m-venkitachalam-potti-and-another-1240
- **Pages:** 52

## Headnote

J '( '
1955
Willie {W.1liam)
Sl1m9
.v.
The Stattof
Madhya Pradesh
Imam J.
1955
December 20.
- 1196 :
, SUPREME· COURT· REPORTS
.· [1955]
obeyed Contravention oC.· its . provisions are unnecessary and neither the . prosecution nor the Courts of
trial should . ignore -'its. provisions in the hope that
they might find shelter under sections 535 and 537 of
the · Code. , Where the · contravention is
substantial
and a retrial. becomes necessary, public time is wasted
and the accused ·is · put to unnecessary harassment
and expense.
.
-
. . .
I agree that the appellant's conviction be altered
from section 302 of the Indian Penal Code to 304 of
the Indian Penal Code and · that · he be sentenced · to
J
five years' - rigorous imprisonment .
.
'
' .
-
',
A. THANGAL KUNJU MUSALIAR
v.
M. VENKITACHALAM.POTTI AND ANOTHER
[S. R.
(with connected appeal)
DAS,
AcnNG
C.J,
VIVIAN BosE,
J AGANNADIIADAS and B. P. S1NHA JJ.]
BHAGWATI,
Constitution
of India-Article 14-Travancore Taratioh
on
Income (Investigatian Commissian) Act, 1124 (Act XIV. of 1124),
s. 5(1)-Whether ultra vires the·Constitution -Read along with s.
47(1) of Travancore Income-tar Act, 1121 (Act· XXlll of 1121)-
High
Court-Jurisdiction-Article 226 of the Constitution-Writ
Petition against authorised Official-Appointet! under s. 6_ of the Tra·
vancore· Act (XIV of 11'24)-Investigation Commission-Whether
competent under the provisions of the Travancore Act XIV of 1124
to inv~stigate cases_ not referred to it ~y Government.
· The petitioncr...:..:i native 0£ Qllilon ·within the Travancore State
-'-had been assesied' to income-tax for the years 1942 and 1943, the
final orders in his assessment having been passed by· the Chief Rcvc·
nue authority of Travancore in December )946 and November 1946
r~spectively.
Travan~orc ~Taxation on
lnc'?mc -(Investigation _<;ommission) Act, 1124. {Act XIV of 1124) modelled on.the Indian Act
XXX of 1947,.was passed by the Travancore Legislature, to provide
for an investigation .into matters r,elating·to taxation on inc6me. In
July 1949, 'the United State ofTravancore and -Cochin was brwght
into existence as , a result of i.Iltegration · hetweeri · the two States. All
existing la\vS of Travancorc were to contin_ue in force by virtue of
Ordinance I of 1124 which was later enacted as Act VI of 1125. In,
November· 1949 the Government of the United State: of Travanc~re-
•
(
2 S.C.R.
SUPREME COURT REPORTS
1197
Cochin issued orders under s. 5(1) of the Travancore Act XIV of
1124 referring the cases of the petitioner for the years
1942
and
1943 (called Evasion Cases Nos. 1 & 2 of 1125) for investigation by
the Travancore Income-Tax Investigation Commission.
Before the
Commission could make its report the Constitution of
India came
into force and the United State of Travancore-Cochin became a part
of India (Part B State) and the Travancore Act XIV of 1124 was continued in force until altered, amended or repealed by a competent
authority.
In April 1950 Parliament passed
Act XXXIII of
1950
whereby Taxation on Income (Investigation Commission) Act, (Act
XXX of 1947) was extended to Travancore-Cochin and the law of
Travancore corresponding to Act XXX of 1947 was to continue in
force with certain modifications. In October
1951,
a
notification
issued by the Indian Investigation Commission appointed Respondent No. 1 as an authorised official under s. 6 of Travancore Act XIV
of 1124 read with Act XXXIII of 1950. Respondent No. 1 sent a
copy of that notification to the petitioner on 21st November,
1951
for his information and further intimated to him that the investigation proposed to be conducted will not be confined to the year> 1942
and 1943 but that it would be necessary for him to investigate the
petitioner's income for the period from 1940 to the
last completed
assessment year.
The petitioner filed a writ petition in
the
Travancore High
Court against Respondent No. 1 and Respondent No. 2 (Indian Income-Tax Investigation Commission)
for a writ of prohibition or
any other

## Text

_Characters 0–39,863 of 117,398. This is a partial read: ask again with offset=39863 for what follows._

J '( '
1955
Willie {W.1liam)
Sl1m9
.v.
The Stattof
Madhya Pradesh
Imam J.
1955
December 20.
- 1196 :
, SUPREME· COURT· REPORTS
.· [1955]
obeyed Contravention oC.· its . provisions are unnecessary and neither the . prosecution nor the Courts of
trial should . ignore -'its. provisions in the hope that
they might find shelter under sections 535 and 537 of
the · Code. , Where the · contravention is
substantial
and a retrial. becomes necessary, public time is wasted
and the accused ·is · put to unnecessary harassment
and expense.
.
-
. . .
I agree that the appellant's conviction be altered
from section 302 of the Indian Penal Code to 304 of
the Indian Penal Code and · that · he be sentenced · to
J
five years' - rigorous imprisonment .
.
'
' .
-
',
A. THANGAL KUNJU MUSALIAR
v.
M. VENKITACHALAM.POTTI AND ANOTHER
[S. R.
(with connected appeal)
DAS,
AcnNG
C.J,
VIVIAN BosE,
J AGANNADIIADAS and B. P. S1NHA JJ.]
BHAGWATI,
Constitution
of India-Article 14-Travancore Taratioh
on
Income (Investigatian Commissian) Act, 1124 (Act XIV. of 1124),
s. 5(1)-Whether ultra vires the·Constitution -Read along with s.
47(1) of Travancore Income-tar Act, 1121 (Act· XXlll of 1121)-
High
Court-Jurisdiction-Article 226 of the Constitution-Writ
Petition against authorised Official-Appointet! under s. 6_ of the Tra·
vancore· Act (XIV of 11'24)-Investigation Commission-Whether
competent under the provisions of the Travancore Act XIV of 1124
to inv~stigate cases_ not referred to it ~y Government.
· The petitioncr...:..:i native 0£ Qllilon ·within the Travancore State
-'-had been assesied' to income-tax for the years 1942 and 1943, the
final orders in his assessment having been passed by· the Chief Rcvc·
nue authority of Travancore in December )946 and November 1946
r~spectively.
Travan~orc ~Taxation on
lnc'?mc -(Investigation _<;ommission) Act, 1124. {Act XIV of 1124) modelled on.the Indian Act
XXX of 1947,.was passed by the Travancore Legislature, to provide
for an investigation .into matters r,elating·to taxation on inc6me. In
July 1949, 'the United State ofTravancore and -Cochin was brwght
into existence as , a result of i.Iltegration · hetweeri · the two States. All
existing la\vS of Travancorc were to contin_ue in force by virtue of
Ordinance I of 1124 which was later enacted as Act VI of 1125. In,
November· 1949 the Government of the United State: of Travanc~re-
•
(
2 S.C.R.
SUPREME COURT REPORTS
1197
Cochin issued orders under s. 5(1) of the Travancore Act XIV of
1124 referring the cases of the petitioner for the years
1942
and
1943 (called Evasion Cases Nos. 1 & 2 of 1125) for investigation by
the Travancore Income-Tax Investigation Commission.
Before the
Commission could make its report the Constitution of
India came
into force and the United State of Travancore-Cochin became a part
of India (Part B State) and the Travancore Act XIV of 1124 was continued in force until altered, amended or repealed by a competent
authority.
In April 1950 Parliament passed
Act XXXIII of
1950
whereby Taxation on Income (Investigation Commission) Act, (Act
XXX of 1947) was extended to Travancore-Cochin and the law of
Travancore corresponding to Act XXX of 1947 was to continue in
force with certain modifications. In October
1951,
a
notification
issued by the Indian Investigation Commission appointed Respondent No. 1 as an authorised official under s. 6 of Travancore Act XIV
of 1124 read with Act XXXIII of 1950. Respondent No. 1 sent a
copy of that notification to the petitioner on 21st November,
1951
for his information and further intimated to him that the investigation proposed to be conducted will not be confined to the year> 1942
and 1943 but that it would be necessary for him to investigate the
petitioner's income for the period from 1940 to the
last completed
assessment year.
The petitioner filed a writ petition in
the
Travancore High
Court against Respondent No. 1 and Respondent No. 2 (Indian Income-Tax Investigation Commission)
for a writ of prohibition or
any other writ prohibiting the Respondents from holding an enquiry
into the cases registered as Evasion Cases Nos. 1 & 2 of 1125 or from
holding an investigation into the income of the petitioner from the
year 1940 to the last completed assessment year.
The Travancore
High Court held that the Respondent No. 2 had all the powers that
the Travancore Commission had under Travancore Act XIV of 1124
and no more and granted the writ prohibiting respondents from conducting an enquiry into years other than 1942 and 1943.
Both the
parties appealed to the Supreme Court against the order of the High
Court. A preliminary objection to the jurisdiction of the High Court
to entertain the writ petition was repeated in the Supreme Court by
the Attorney-General.
Held, that the High Court had jurisdiction under Art. 226 of
the Constitution to issue a writ against Respondent No. 1 because
under the provisions of s. 6 of the Travancore Act XIV. of 1124 the
authorised official (Respondent No. 1) had considerable pmv,rs conferred upon him in the conduct of the investigation, and if he did
anything as authorised official which was not authorised by law or
was violative of the fundamental rights of the petitioner as in the
present case he would be amenable to the jurisdiction of the High
Court under Art. 226 of the Constitution.
Held, further that under the provisions of the Travancore Act
XIV of 1124 the Commission had no authority to investigate any
case suo motu. It could only investigate ·cases referred
to it by
1955
A. Thangal Kunju
Musaliar
Yo
M. Vmkila&halam
Polti and another
1955
.A. Thagol KURja
M.,..J;ar
...
M.Vmkila</ul/am
Poui ll1ld llMt/1#
1198
SUPREME COURT REPORTS
[1955]
Government.
All that was done in the preserit case was
that by
two separate orders made under s. 5(1) of the Act the C'-r0vernment
referred two cases of the petitioner for the two years 1942 and 1943
to the Commission. There was no other order under s. 5(1) at any
time before 16th February 1950 and none could be made under that
sub-section after that date.
Therefore neither Respondent No. 2
nor Respondent No. 1 who had been appointed as authorised Official
by Respondent No. 2 had jurisdiction to cover any period beyond
the two specific years 1942 and 1943 and the notice
dated 21st
November 1951
issued by Respondent No. 1 to investigate the petitioner's income for the
period from 1940 to the
last completed
assessment year was clearly illegal and without jurisdiction.
Held, also that s. 5(1) of the Travancore Act XIV of 1124
which is ·to be read in juxta-position with s. 47 of the Travancore
Income-Tax Act,
1121 {XXIII of 1121)
is not discriminatory and
violative of the fundamental right guaranteed under Art. 14 of the
Constitution.
Section 47( 1) of the Travancore Act XXIII of 1!21 was directed
only against those
persons concerning \Vhom definite
information
came into the possession of the Income-tax Officer an<l in consequence of which the Income-tax Officer discovered that the income
of those persons had escaped or been under-assessed or assessse<l at
too low a rate or had been the subject of excessive relief. The class
of persons envisaged by s. 47(1) was a definite class about which
there was definite information leading to discovery within 8 years
or 4 years as the case may be of definite item or items of incomcwhich had escaped assessment. The action to be taken under Travancore Act XXIII of 1121 was not confined to escapement from assessn1ent of income inade during the war period (September 1939 to
1946). Action could be taken in respect of income which
escaped
assessment even
before
the
war and also more than 8 years after
the end of the war.
On the other hand under s. 5(1) of the Travancore Act XIV of
1124 the class
of persons sought to be reached comprised only
these persons about whom there was no definite information and no
·discovery of any
definite item or items of income w}:iich escaped
taxation but about whom the Government had only prima facic
reason to believe
that they had evaded payment of tax to a substantial amount. Further, action under s. 5(1) read with s. 8(2) of
the Travancore· Act XIV of 1124 was definitely limited to the evasion
-of payment of taxation on income made during the war period and
therefore s. 5(1) of the Travancore Act XIV of 1124
was
not
discriminatory in comparison with s. 47(1) of the Travancore Act
XXIII of 1121.
. Election
Commission,
India v. Saka
Venkata
Rao ([1953]
S.C.R. 1144), K. S. Rashid & Son v. The Income-tax Investigation
CommissiOn, etc. ( [1954 l S.C.R. 738), Azmat Ullah v. Custodian, Evacuee Property, U.P., Lucknow (A.I.R. .1955 All. 435), Burhanpur
2 S.C.R.
SUPREME COURT REPORTS
1199
Nation,,/ Textile Wol'kers
Union,
Burhanpur v. Labour Appellate
Tribumil of India at Bombay and others (A.LR. 1955 Nag. 148),
/oginde1: Singh Waryam
Singh v. Director,
Rural Rehabilitation,
Pepsu, Patiala and others (A.LR. 1955
Pepsu 91),
Chiranjit Lal
Chowdhuri v. The Union of India ([1950] S.C.R. 869),
Budhan
Chowdhury and others v. The State of Bihar ([1955] 1 S.C.R. 1045),
Suraj .\fall 1Hohta & Co. v. A. V. Visvanatha Sastri and another
( 119551 1 S.C.R. 448), Sh1·ee Meenakshi Mills Ltd. v. Sri A. V. Visva11atha Sastri and Another ( [1955] I S.C.R. 787), Astvini Kumar Ghose's
case (!1953 J S.C.R. 1), Subodh Gopal Bose's case ([1954] S.C.R. 587,
62il), Kathi Raning Ratl'at v. The State of Saurashtl'a (11952] S.C.R.
4.15). Palser Y. Grinling (119481 A.C. 291) and Kedar Nath Bajoria
v. The State of West Bengal (1954] S.C.R. 30), referred to.
C1v1L
APPELLATE
JuR1so1cnoN :
Civil
Appeals
Nos. 21 and 22 of 1954.
Appeals under Article 133(1) (c) of the Constitution of India from the judgment and order dated
the
18th September 1953 of
the Travancore-Cochin High
Court at Ernakulam in 0. P. No. 41 of 1952.
M. K. Nambiar,
(N. Palpu, Sri Narain
Andley
and Rajinder Narain) for the appellant in C. A. No.
21 of 1954 and respondent in C. A. No. 22 of 1954.
M. C. Setalvad,
Attorney-General of India ( G. N.
Joshi), R. Ganapatlzy Iyer, Porus A. Mehta and R. H.
Dhebar), for the respondents in C. A. No. 21 of 1954
and appellants in C. A. No. 22 of 1954.
1955. December 20. The Judgment of the Court
was delivered by
BttAGWATI J.-These two appeals
with certificates
under article 133 of the Constitution are directed
against a judgment of the High Court of TravancoreCochin in a writ petition filed
by one A. Thangal
Kunju Musaliar, hereinafter called the petitioner.
The petitioner is a native of Quilon within the
Travancore State which was
originally
under the
sovereignty of the Maharaja of Travancore. He is the
Managing
Director of Messrs.
A. Thangal Kunju
Musaliar
& Sons Ltd., Quilon, and had been assessed
to income-tax for the years 1942
and 1943 and the
final orders in his assessment for the said years were
1955
A. Thangal Kunju
Musaliar
v.
M. YmkiJa&holam
Poffi and (IJl/}f/utr,
1955
..!. Tlllmgal ir .. ju
Musalia!-
v.
M. VmlUadialam
Potti and anolhir
Bhagwali].
1200
SUPREME COURT REPORTS
[1955]
passed by the Chief Revenue Authority of Travancore on the 6th December 1946 and 30th November
1946 respectively.
On the 7th March
1949, the Travancore Legislature
passed Act XIV of 1124 (M.E.) modelled · on our Act
XXX of 1947, styled the Travancore Taxation
on
Income
(Investigation
Commission)
Act 1124, to
provide for an
investigation into matters relating to
taxation on income. Section 1 (3) of the Act provided
that it was to come into force on such date as the
Travancore Government may by notification in the
Government
Gazette appoint.
Under section 3,
a
Commission
to be called the Income-tax Investigation Commission was to be constituted inter alia to
investigation in accordance with the provisions of the
Act cases referred to . it under section 5 and report
thereon to the Government.
The Commission was
to be appointed to act in the first instance up to the
last day of Karkadakom 1125
(16-8-1950)
but the
Government was empowered to extend its · appointment to any period up to the last day of l(arkadakom
1126 ( 16-8-1951).
Section 5 ( 1) enacted that the Government might, at any time before the last day <Jf
Makaram 1125
(15-2-1950)
refer to the Commission
for investigation and report any
case or points in a
case in which the Government had prima facie reasons
for belief that a person had to a substantial extent
evaded payment of tax on income together with such
material as might be available in support of such belief. Section 6 prescribed the powers of the Commission and inter alia provided for the appointment by
the Commission of an authorised official to examine
accounts or documents, interrogate persons or obtain
statements from persons.
On the 1st July 1949,
the Travancore State and
the Cochin State integrated with each other and there
was
brought
into existence the United State
of
Tra".ancore and Cochin.
By virtue of Ordinance I
of 1124 promulgated on the same day, called the
United State of Travancore and Cochin Administration
and Application
of
Laws
Ordinance,
1124
(Ordinance I was enacted later as Act VI of 1125),
2S.C.R.
SUPREME COURT REPORTS
1201
all existing laws of Travancore were to continue in
force till altered, amended or repealed by competent
.authority.
The existing law of Travancore was defined to mean
any law in force in the State of
Travancore immediately prior to the 1st July 1949.
On the 26th
July
1949,
a
notification was
published
in
the
Travancore-Cochin
Government
Gazette whereby, in exercise of the powers conferred
by section 1(3) of the Travancore Taxation on Income
Investigation Commission) Act XIV of 1124 as continued
in force by the United State of Travancore and
Cochine Administration & Application of Laws (Ordinance, 1124 (I of 1124), the Government appointed
the 7th Karkadakom 1124 (22-7-1949) to be the
date
-0n which the said Act was to have come into force·
On the 26th November 1949 the Government of the
United State of Travancore and Cochin issued orders
under section 5(1) of the Travancore Act XIV of 1124
referring the cases of the petitioner for the years 1942
.and 1943 for investigation by the Travancore Income-tax
Investigation
Commission.
These
orders
had specific reference to the years 1942 and 1943 and
the investigation to be made by the Commission was
with reference to the alleged evasion of tax by t1'e
petitioner for those respective years.
The cases were
registered as Evasion Cases 1 and 2 of 1125.
On the 10th December 1949 the petitioner received
from the Secretary of the ComJ:»ission a notice in
regard to the said cases. The relevant portion of the
said notice stated:
"Whereas
the
Income-tax
Investigation
Com·
mission having been informed that a substantial portion of your income
for
1942 and 1943 has escaped
-assessment, has ordered investigation into the matter,
you are hereby required to produce the following on
-or before 21-12-1949 before the Commission.
1. The account books
(day books and ledgers)
:for
the years 1942 and 1943 •
. 2.
3.
4.
. ...
1955
A. T lllmgal Kunju
MUS!lliar
v.
M. Y lllkilackalam
Potti and fJtUJt/zlr
BhagwatiJ.
1955
A. Thangal K1Jnj"
Musaliar
"·
M. V enkitachalam
Potti and anoth"
Bhagwati].
1202
5.
6.
SUPREME COURT REPORTS
[1955]
Pursuant
to this notice
the petitioner produced the
relevant books and the Commission duly completed
its investigation under the terms of the Travancore
Act XIV of 1124:
Before the Commission could, however, make itsc
report, the Constitution of India came into force on
the 26th January
1950 and the United
State of
Travancore and Cochin became a part of the territory
of India, forming a Part 'B' State.
Under article
372(1) of the Constitution, the Travancore Taxation
on
Income
(Investigation
Commission)
Act,
1124
(Travancore
Act XIV of 1124) was continued in force
"until altered, amended or repealed
by a competent
authority".
An Indian
States Finance Enquiry Committee had
been appointed in 1948-49 and it had made its recommendations regarding the agreements to be entered
into between
the President of the Union
and
the
Rajpramukhs in regard to financial
arrangements.
In
accordance with the recommendations of the Com--
mittee,
an agreement was entered into on the 25th
February 1950 between the President of the
Union
and the Rajpramukh of Travancore-Cochin in regard'
to these matters and on the 31st March 1950 the
Finance Act, .1950 (Act XXV of 1950) came "into force·
and the
Indian Income-tax Act, 1922 (XI of
1922)
was extended to Travancore-Cochin.
On the 18th April 1950, the Opium and Revenue·
Laws (Extention of Application) Act, 1950, being Act
XXXIII of 1950, was passed by Parliament
extending
to
Travancore-Cochin Taxation
on
Income
(Investigation
Commission)
Act,
1947
(XXX
of
1947) and section 3 of that Act provided that the
law of Travancore corresponding to the Taxation on
Income
(Investigation
Commission)
Act, 1947 (XXX
of 1947) shall continue
to remain in force with the
following modifications, viz.,
(a) that all cases referred to or pending before
the State Commission (by whatever name called) in
respect of
matters relating to taxation on income
2S.C.R.
SUPREME COURT REPORTS
1203
other than agricultural income shall stand transferred
to the Central Commission for disposal; and
(b) that the State law shall, so far as may be,
apply to determine
the procedure
that
may
be followed
and powers that may be exercised by the
Central Commission in the disposal
of cases
transferred under clause (a).
The Travancot='c Commission had been appointed
in the first
instance
to act
up to
the last day of
Karkadakom
1125
(16-8-1950).
Neither the Travancore Commission nor the Indian Commission to which
the pending cases before the Travancore Commission
were
transferred as
aforesaid
made
any
report
on
these casrs of the petitioner before the expiry of this
period nor was any extension of the term of appoint--
ment of the Travancore Commission made up to the
la~t day of Karkadakom 1126 (16-8-1951) as
originally
contemplated.
On the 25th·
August 1951, therefore,,
the Opium and Revenue Laws (Extension
of Application)
Amendment Act, 1951, being Act XLIV of
1951,
was passed
amending Act XXXIII of 1950
whereby it was provided that in the place of clause (b)
of section 3 of Act XXXIII of 1950, the following
clause shall be substituted and shall be deemed always
to have been substituted,
viz., "in
the disposal of
cases
transferred · to
the
Central
Commission
the
Commission shall have and exercise the s:tme powers
as it has
and exercise in the investigation 9£
cases
referred to it under the Taxation on Income (Investigation
Commission)
Act,
1947
(XXX of 1947) and
shall be entitled to act for same term as under subsectic•n (3) of section 4 of that Act" and it was furher
provided that any decision given by the Chief Revenue
Authority
of Travancore or of
Travancore-Cochin
shall be deemed a decision of the Income-tax Auth<>
rity for the purposes of sub-section
(2) of section 8
of the Travancore Act XIV off 1124.
On
the 18th October 1951, a notification was
issued
by
the
Indian
Income-tax
Investigation
Commission appointing M. V enkitachalam Potty, Income-tax Officer on Special Duty, Trivandrum, as an
1955
A. Thanga IKUllp
Musaliar
v.
M. VenkitachdamPotti and another>
Bha,f<Wali J;
1955
A. Thangal Kunju
Musaliar
v.
M. Venkitachalam
Potti orid another
BhagwaJi].
1204
SUPREME COURT REPORTS
r t9551
authorised official under , section 6 of the Travancore Taxation on Income (Investigation Commission)
Act, 1124 read with Act XXXIII of 1950. The authorised official, hereinafter - referred to as respondent l,
forwarded
to the petitioner on
the 21st November
1951 for his information a copy of that notification
investing him with the powers of an authorised official
and intimated that the investigation proposed to be
conducted will no be confined to the years 1942 and
1943, the two years originally covered
by Evasion
Cases Nos. l and 2 of 1125 but that it would be necessary for him to investigate the petitioner's income
for the period from 1940 to the last completed asse»-
ment year notwithstanding the fact that the erstwhile
State Commission had not specifically intimated
to
him that they proposed to cover the full period.
;rhe petitioner, by his registered letter dated the
23rd February 1952 pointed out to respondent 1 the
illegality of the steps
proposed
to be taken
by
him to 'which, however, the la_tter replied - by his letter
dated the 13th March 1952 stati1ig that he proposed
to consider income for the full investigation period,
viz., from 1940 -to the
last completed assessment year.
The petitioner thereupon filed on the 6th May 1952
a writ petition in the High Court of TravancoreCochin, being 0. P. 41 of 1952 against respondent 1
as also
the Indian Income-tax
Investigation
Commission, hereinafter called respondent 2, for a writ of
prohibition or any other appropriate writ or direction
prohibiting the respondents from holding any enquiry
into the cases registered as Evasion Cases Nos. 1 and
2 of 1125 on the file of
Income-tax Investigation
Commission of
Travancore or from holding any investigation into the
income of the petitioner from
1940 to the last completed assessment year or for any
other period.
Respondent
1 filed
a counter-affidavit in which it
was inter alia submitted:
"that the Commission by these proceedings is not
trying to clutch at non-existent jurisdiction.
They
are fully prepared to shape their proceedings in accordance with the direction of this Hon'ble Court".
2S.C.R.
SUPREME COURT REPORTS
1205
This affidavit was stated to have been filed as the
answer
of
both
the counter-petitioners, viz., respondents 1 and 2 and respondent 1 stated that he had
been fully authorised to do so.
The writ petition was heard by a Bench of three
Judges of the High Court consisting of K. T. Koshi
C. J. and P. K. Subramonia Iyer and M. S. Menon,
JJ.
The learned Judges held that respondent 2 had
all thl". powers
that
the Travancore Commission had
undi;r the Travancore
Act XIV of 1124 and no more
and
accordingly issued a writ prohibiting respondent
l from conducting an investigation into years other
than 1942 and
1943 observing that any attempt to
enlarge the scope of the enquiry was without legislative warrant.
The petitioner appealed in so far as the order of
the High Court was against him permitting the enquiry for
the years 1942 and 1943, his
appeal being
Civil Appeal No. 21 of 1954.
Respondents 1 and 2
appealed against the order of the High Court in so
far as it prohibited respondent
1 from conducting investigation for the years which were not covered by
the Evasion Cases Nos. 1 and 2 of 1125, their appeal
being Civil Appeal No. 22 of 1954.
Both these appeals came for hearing and final disposal before us on the 20th September
1955.
After
the
argument had proceeded for some time Shri
Nambiyar, for the petitioner, asked for leave to urge
additional grounds, viz., (a) that section 5 ( 1) of Travancore Act XIV of 1124 was ultra vires under articles 14 and 19 of the Constitution, and (b) that in
particular the said section 5 ( 1)
infringed article 14 of
the Constitution inasmuch as it was not based on any
rational
classification
whatsoever,
and
the
word
"substantial" therein could not possibly be deemed
to be any form of classification.
On our giving him
such
leave the 'learned Attorney-General, appearing
for respondents 1 and 2 asked for time to put in an
affidavit showing the background against which Travancore Act XIV of 1124 had been passed by the
Travancore Legislature.
An affidavit
was
accordingly filed before us by Gauri Shanker, Secretary of
1955
A. Thangol Kunju
Musolior
v.
M. V enkittUholam
Potti and another
Bhogwati].
1955
A. Thangal Kunju
Musaliar
v.
M. Venkitachalam
Potti and another
Bh.agwali].
1206
SUPREME COURT REPORTS
p955i
(espondent 2 setting out facts and events as and by·
way of answer to these new contentions of the peti-.
ti oner.
A preliminary objection to the jurisdiction of the
High Court to entertain the writ
pet1t10n
may be
dealt with first. This objection was not taken in the·
counter-affidavit filed
by the
respondents,
they
having expressed their readiness to shape
their proceed--
ings in accordance with the directions of the Court.
The "learned
Advocate-General
of
Travancore-Cochin
however, urged before
the High Court that the Court
was not competent to entertain the petition in view
of the that that respondent 2 was not amenable to
its jurisdiction and the argument was that as respondent 2 functioned outside
the
State of TravancoreCochin
and
respondent 1 was a mere subordinate of
respondent 2, it was
beyond
the competence of the
High Court to grant the prayer embodied in the petition.
The High Court overruled the objection observing, that respondent 1 was
resident within the State
of
Travancore-Cochin, his
office was
situated
at
Trivandrum,
all
his
communications
to
the
petition.er had emanated from within the State and the
act1v1t1es
complained
about
were
acuv1t1es
confined
to the State.
It was of the opinion that the prayer
in the petition was,
in essence, a prayer to paralyse
the hands of respondent 1 and thus prevent the mischief and
that,
by his residence and
the location of
his office within the State, respondent 1 was clearly·
amenable to the jurisdiction of the Court under article 226 of the Constitution.
It was further of opinion
that
the writ against respondent 1,
if issued, was
sufficient for
stopping the mischief complained about
and therefore it was unnecessary for it to decide whether or not a writ could be issued so far as respondent
2 was concerned.
It, therefore, issued the necessary
writ of prohlbition against respondent 1.
The learned Attorney-General pressed this preliminary objection at the outset while arguing Civir Appeal
No. 22 of 1954.. He pointed out that respondent 2 had
its office in New Delhi and was permanently located'
there and the mere fact of its having appointed: res-
2S.C.R.
SUPREME COURT REPORTS
1207
pondent 1 to function
and carry on the investigation
within the State of Travancore under its direction did
not make it amenable to the jurisdiction of the High
Court. He, therefore, contended that the High Court
had
no jurisdicion to entertain the writ
petition
Jgainst respondent 2. He further contended that the
High Court could not .do indirectly what it was
not
able to do directly an<l
that it could not issue any
writ of ·prohibition against respondent 1 either even
though he had his office at Trivandrum
and had a
permanent
location
within
the
jurisdiction
of
the
High Court inasmuch as he was merely an arm of respondent 2 and any writ issued against him would have
the indirect effect of prohj_biting respondent 2 from
exercising its legitimate functions
within the ambit
of its powers under the Travancore Act XIV of 1124
read with A.ct XXX of 1950 and Act XLIV of 1951.
Reliance was placed by him on the decision of this
Court in Election Commission, India v. Saka T'enkat.1
Rao(1 ).
The
respondent
in
that
case
had applied
to the High Court of Madras under article 226
for a writ restraining the Election Commission, a
statutory authority
constituted
by
the Presi<lent
and
having its office
permanently located at New Delhi
from enquiring into
his
alleged
disqualification
for
membership of
the
Assembly, and a single Judge of
the High Court
had issued a writ of prohibition restraining the Election Commission from
doing so. The
Election Commission filed an ;ippeal to this Court arid
agitated the question of
the jurisdiction of the High
Court under article 226 to issue the writ agai.11st it.
While discussing
this question, Patanjali
Sastri C. J.,
who delivered
the
judgment of the Court, observed
as under:-
"Rut wide
as were the powers thus conferred, a
two-fold
limitation was placed upon their exercise.
In the first place, the power is to exercised "throughout the territories in relation to which it exercises ·
jurisdiction'', that is to say, the writs issued by the
Court cannot run beyond the territories subject to its
jurisdiction.
Secondly,
the
person or authority to
(I) [1953] SCR 1!44.
1955
A. Tlzangal Ku,Yu
Uusaliar
v.
M. Vtnkitachalam
Potti and another
Bhagwali].
1955
A. Thangal Ku,Yu
Musaliar
v.
M. Venkitachalam
Patti and another
BhagwaliJ.
1208
whom the
.writs must
ly implies
tion either
tories".
SUPREME COURT REPORTS
[1955}
High Court is empowered to issue such
be "within those
territories" , which clearthat they must be amenable to its jurisdicby residence or location within those terriThe learned Chief Justice
then traced the origin
and development of the power to issue prerogative
writs as a special remedy in England and observed at
page 1151:-
"These writs were thus specifically directed to
the persons or authorities
against whom redress was
sought and were made returnable in the Court issuing
them and, in case of disobedience, were enforceable
by attachment
for contempt.
These
characteristics
of the special form of remedy rendered it necessary
for its effective
use that the persons or authorities to
whom the Court was asked to issue these writs should
be within the limits of its territorial jurisdiction".
The mere functioning, of the tribunal or authority
permanently located and nurmally carrying on its activities elsewhere, within the territorial limits was not
considered sufficient to invest the High Court with
jurisdiction under article 226 nor was the accrual of...,.
the cause of action within the territories considered
sufficient for the purpose.
The residence or location
within the territories of the person or authority was
considered a condition of the High Court being empowered to issue such writs with the result that the
Election
Commission having its office permanently
located at New Delhi was held not amenable to the
jurisdiction of the High Court for the issue of a writ
under article 226.
This decision in Saka Venkata Rao's case was
followed by this Court
in K. S. Rashid & Son v. The
Income-tax Investigation Commission, etc.(').
In that
case, the assessees who were within the State of U.P.
and whose original assessments were made
by the
ipcome-tax authorities of that State · had filed
writ
petitions in the Punjab High Court for the issue of
writs under article 226
to the Income-tax Investigation Commission located in Delhi and investigating
(1) [1954] SCR 738 ..
2 S.C.R.
SUPREME COURT REPORTS
120')
their cases under section 5 of the Taxation on Income
(Investigation Commission)
Act, 1947.
The Punjab
High Court had sustained the objection urged on
bi;half of
the respondents to the effect that the
assessees
having belonged
to the State of U.P. their
assessment was to be made
by the Income-tax Commissioner of that State and the mere fact that the
location of . the Investigation Commission was in Delhi
would not confer jurisdiction
on the Punjab High
Court to issue writs under article 226 and had dismissed
the petitions.
This Court, on appeal, distinguished
the decision in Parlakimidi's case which was
sought to be relied
upon
by the respondents before it
and followed the position in law as it had been
enunciated
in
Saka
Venkata
Rao's case
supra,
and held that the Punjab High Court had jurisdiction
to issue a writ under article 226 to the Investigation
Commission which was located in Delhi in spite of
the fact that the assessees were within the State of
U.P. and their original assessments were made by the
income-tax authorities of that State.
The principle of these decisions would, it was urged
by the learned Attorney-General,
eliminate
respondent 2 and
the
High Court of Travancore-Cochin
would have no jurisdiction to entertain
the writ petition against it.
It was, however, urged on behalf of the petitioner
that, in the affidavit filed by the respondents, both
the respondents
had submitted that they were fully
prepared
to shape their proceedings in accordance
with the directions of the Court. This, it was submitted, was a voluntary submission to the jurisdiction of the High Court investing the High Court with
jurisdiction
to issue the
appropriate writ
against
respondent 2.
We need not, however, express any
opinion on this point because no writ was
in fact
issued by the High Court against respondent 2 nor
was any appeal filed by the petitioner against that
part of the decision of the High Court.
The real question, however, is whether a writ could
issue against respondent 1 who is, it was submitted,
a mere arm of respondent 2 and a writ against whom.
1955
A. Thangal KUJ!iu
Musaliar
v.
M. V1nkitae/ullam
Potti artd a11otlwi
BhagwatiJ.
1955
.. A. Thanxal Kunju
Mu.salitJT
v.
M. Vtnkitacludam
Potti anJ anothtr
-Bhagwa#J.
1210
SUPREME COURT REPORTS
(1955]
would be equivalent to a writ issued by the High
Court against respondent 2 which it had no jurisdiction. to do.
An authorised official derives his appointment from
the O>rnmission under section 6 of the Travancore
Act XIV of 1124.
Section 6(4) of the Act provides
that if in the course of any investigatior>
conducted
by
the Commission it appears to the Commission to
he necessary to examine any accounts or tlocuments
of ta interrogate any person or to obtain any statement from any person
the Commission may authorise
any income-tax authority not below the rank of an
income-tax officer
(called the "authorised
official")
in that behalf subject to such directions as may be
issued by the Commission from time to time and the
authorised official
shall examine the accounts or documents, interrogate the personi and obtain the statements from the persons.
The authorised
official is
invested, under section 6, sub-section (5), subject to
the
direction of the Commission, with the
same
powers . as the Commission under sub-sections (1), (2)
and (3) which empower the Commission to require
any person or banking or other company
to prepare
and furnish written statements of accounts and affairs
giving information on such points or matters as in
the opinion
of
the Commission may directly
or indirectly be useful or relevant to any case referred to
it; to administer' oaths and exercise
all powers of a
·Civil Court under the Code of Civil Procedure for the
purpose of taking evidence on oath, enforcing attend-
· aJlce of witnesses and of persons
whose cases are
being investigated, compelling the production of documents and issuing commissions for the examination
of witnesses and to impound and retain in its custody
for such period as it thinks fit any documents produced before it.
The
authorised official is, under
section 6, sub-section (10), to have full and free access
to all documents, books and other papers which in his
opinion are relevant to the proceedings in any case or
cases under the Act and if specially authorised in this
behalf by the Commission to any buildings and places
where he may have reason to believe
that such books,
2S.C.R.
SUPREME COURT REPORTS
1211
documents or papers may be found and also to have
power to place identification marks on such
books,
documents or papers and to make extracts or copies
therefrom or if he considers it necessary to take possession of or seize such
books, documents or papers.
Under section 6,
sub-section ( 11),
the authorised official is deemed to be a public servant wihin the meaning of section 16 of the Travancore Penal Code · (I of
1074).
It is clear from the above provisions that the authorised official
has considerable powers conferred upon
him in
the conduct of
the investigation and even
though he could be called a mere arm of the Commission
or an authorised agent of the Commission, he
has
important functions
to
discharge
and
is
not
merely a mouth-piece of the Commission or a conduit-pipe transmitting the orders or the directions of
the Commission.
He is no doubt under the general
control and supervision of the Commission but he
performs
the various functions assigned
to him on
his own initiative and in the exercise of his discretion.
If, therefore, he does anything in the discharge of his
functions
as authorised official which is not authorised by law or is violative of the fundamental rights
of the petitioner, he would
be amenable to the iunstktion of the High Court under article 226.
Even though this is the prima facie position, it was
urged that he is
acting under the directions of the
Commission as
its authorised agent and as such no
writ can issue against him, because the principal who
directs the activities and not the agent
would be
liable for
the same.
This contention is
unsound.
There can be no agency in the matter of the commission of a wrong.
The wrong doer would certainly be
liable
to be dealt . with as the party directly responsible
for his wrongful action.
The
relationship
between
principal and agent would only be
relevant for the
purpose
of determining whether
the principal also is
vicariously liable for the wrong perpetrated by his
agent.
On the analogy of criminal liability,
the
22-85 S. C. India/59
1955
A, T hangal K 1111ju
Musaliar
v.
M. Tienkilachalam
Potti and another
-·
Bhagwali ].
1955
A. Thangal KU1jju
Musa liar
••
M. V tnkitachalam
Petti and anotktr
Bhagwati].
1212
SUPREME COURT REPORTS
[1955]
offender could
certainly not be heard to say that he
was comm1ttmg the offence under the behest or directions of his principal. On the analogy of a civil wrong,
the tortfeasor fould certainly not
protect
himself
against liability on the ground of having committed
the tort under the directions
of his principal. The
agent could in no event exculpate himself from liability for the wrongful act done by him and if he is
thus amenable to the jurisdiction of the High Court
the fligh Court could certainly issue an appropriate
writ against him under article 226.
The jurisdiction
under article 226 is exercised by the High Court in
order to protect and safeguard the rights of the
citizens and wherever the
High Court finds that any
person within its territories is guilty of iloing an act
which is not authorised by' law or is violative of the
fundamental rights of the citizen, it
exercises that
jurisdiction
in order to vindicate his rights
:rnd
redress his grievances and the only conditions of its
exercise of that jurisdiction are those laid down in the
passage from Patanjali Sastri, C. J.'s judgment cited
above. The argument that by issuing a writ against
the agent under
those circumstances the High Court
would be putting him in a position whereby
he
would be compelled to disobey
the directions of his
principal is also of no avail for the simple reason that
an agent
is
bound to obey all lawful directions of his
principal anc? not directions which the High Court
holds to be unlawful or not justified in law. The agent
could certainly be prohibited from
obeying the
unlawful directions of his principal and even if the
principal cannot be reached by reason of his being
outside the territories, the arm of the law could certainly reach the agent who is guilty of having committed the wrong and the High Court could certainly
issue a writ against him under aricle 226.
It was further
contended that by issuing such a
writ agaimt the authorised official the
High Court
would be indirectly prohibiting the Commission from
conducting the investigation within
the
territories
even though it could not directly prohibit the Com-
.2 S.C.R.
SUPREME COURT REPORTS
1213
mission from doing so.
If the Commission was doing
something within the territories
through its
auth~
rised official
which was not justified in law, it would
not lie in the mouth of the Commission to urge that
the High Court. could not issue a writ of prohibition
against its agent, the authorised official, who had his
residence or permanent location within the territories
merely
because
it
would
be indirectly
prohibited
from
perpetrating a wrong within
the
territories.
The principal could, in no event urge that his agent
should be allowed to function for him wihin the
territories in a manner
which was not warranted by
law or had no justification in law.