# L. HAZARI MAL KUTHIALA v. THE IXCOME-TAX OFFICER, 8PECIAL CIRCLE, AMBALA CANTT

- **Citation:** [1961] 1 S.C.R. 892
- **Court:** Supreme Court of India
- **Decided:** 1961
- **Case number:** No. 135 of 1958
- **Bench:** S. K. Das, Ill. HIDAYATULLAil, K. c. DAS GUP'l'A, J.C. SHAH a.n<l N. RAJAGOPALA AYYANOAR
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/l-hazari-mal-kuthiala-v-the-ixcome-tax-officer-8pecial-circle-ambala-cantt-2181
- **Pages:** 11

## Headnote

/ncomt-tax--Co1111nissionrr's power of transfer-Sfalulor.Y protJision for consulting the Central Board of Reve1u1e-/j mandatOT)'-
1·ransftr of pending and
non~pendi1zg cases-Pati~la Inconze-tax
Act of Samvat 2oor s. 5, sub-ss. (5). (7A). s. 34-Indtan Jncume-ta.t
Act, r922 (II of r922), s. 64(r).- -lndia11 Finance Act, r950 (26 of
r950), S. IJ.
The appellant firm which carried on business as forest
lessees and timber merchants in tl1e former Kapnrthala State
\\·as assessed to, and paid, income tax, for the accoqnt year
1945-46 under the Income-tax law which was th•n in force in
the said State. Subsequently Kapurthala State integrated into
what was known as Pepsu and the l'atiala Income-tax Act, 2001,
was made applicable and came into force in the integrated State.
Lat•" still the Indian Finance Act, 1950 (i6 of 1c.i50), applied
the Indian Income-tax Act to Part B States which had emerged
as a result of political changes ands. 13 of the Indian Finance
Act repealed the Income-tax laws obtaining in Part B States
except for the purposes of levy assessment and collection of
income-tax and Super-tax relating to the period mentioned
therein. On November 4, 1953, the Commissioner of Incometax, Punjab (r) etc. purporting to act under s. 5, sub-ss. (5) and
(7A) of the Indian Income-tax Act ordered theassessment of the
appellant firm to be don• by the Income-tax Officer. Special Circle, Ambala and not by the Income-tax Officer. B-Ward, Patiala,
who would ordinarily be the competent assessing authority for
the firm under s. 64 of the Indian Income-tax Act. On ~larch
12, 1953, the Income-tax Officer. Special Circle, Ambala, issued a
notice purporting to be under the Patiala Income-tax Act of
Samvat 2001 to the appellant firm for filing a return of its income and total world income as he believed that the income
had been underassessed.
The appellant then filed an application under Art. 226 of the Constitution in the High Court for
writs of prohibition, certiorari, quo warranto etc. against the
Income-tax Officer, Special Circle, Ambala, and the Commissioner of Income-tax, Punjab (r) etc. regarding the reassessment of
the income of the firm for the account year 1945-46. The High
Court dismissed the said petition and this appeal was filed on a
certificate granted by the High ~ourt. The contentions of the
appellant inter alia, were that the Income-tax Officer, Special
Circle, Ambala, had no jurisdiction to issue a notice under s. 34
1 S.C.R. SUPREME COURT REPORTS
893
of the Patiala Income-tax Act of Samvat 2001, and that only the
Income-tax Officer, B-Ward, Patiala,•was the competent authority as he was the locally situated Income-tax Officer and would
have jurisdiction under s. 64(1) of the Income-tax Act. The
transftr of the case by the Commissioner of Income-tax by his
order of November 4, 1954. was characterised as ultra vires and
incompetent.
The argument that the words of s. 13 of the
Indian Finance Act, 1950, did not include reassessment was
abandoned in view of the decisions of this Court in Lakshmana
Shenoy v. The Income-tax Officer, Ernakulam, [1959] S.C.R. 75r.
It was further contended that the Commissioner in acting under
s. 5(5) of the Patiala Income-tax Act was required to consult
the Minister-in-Charge whose place was taken by the Central
Board of Revenue under the Indian Finance Act, 1950.
Held, that although the Commissioner of Income-tax was
required to consult the Central Board of Revenue his failure to do
so did not render his order ineffective however wrong it might
be from the administrative point of view. The provision about
consultation must be treated as directory and the Commissioner's
power could not be questioned by the assessee on the ground of
failure to consult the Central Board of Revenue.
State of U.P. v. Manbo;J.han Lal Srivastava, [1958] S.C.R. 553,
K. S. Srinivasan v. Union of India, [1958] S.C.R. 1295, Montreal
Street Railway !Company v. Normandin, L.R. 1917 A. C. 170
and Biswanath Khemka v. The King Empero

## Text

892
SUPREME COURT REPORTS
(1961]
L. HAZARI MAL KUTHIALA
v.
THE IXCOME-TAX OFFICER, 8PECIAL
CIRCLE, AMBALA CANTT.
(S. K. DAS, Ill. HIDAYATULLAil, K. c. DAS GUP'l'A,
J.C. SHAH a.n<l N. RAJAGOPALA AYYANOAR, ,J,J.)
/ncomt-tax--Co1111nissionrr's power of transfer-Sfalulor.Y protJision for consulting the Central Board of Reve1u1e-/j mandatOT)'-
1·ransftr of pending and
non~pendi1zg cases-Pati~la Inconze-tax
Act of Samvat 2oor s. 5, sub-ss. (5). (7A). s. 34-Indtan Jncume-ta.t
Act, r922 (II of r922), s. 64(r).- -lndia11 Finance Act, r950 (26 of
r950), S. IJ.
The appellant firm which carried on business as forest
lessees and timber merchants in tl1e former Kapnrthala State
\\·as assessed to, and paid, income tax, for the accoqnt year
1945-46 under the Income-tax law which was th•n in force in
the said State. Subsequently Kapurthala State integrated into
what was known as Pepsu and the l'atiala Income-tax Act, 2001,
was made applicable and came into force in the integrated State.
Lat•" still the Indian Finance Act, 1950 (i6 of 1c.i50), applied
the Indian Income-tax Act to Part B States which had emerged
as a result of political changes ands. 13 of the Indian Finance
Act repealed the Income-tax laws obtaining in Part B States
except for the purposes of levy assessment and collection of
income-tax and Super-tax relating to the period mentioned
therein. On November 4, 1953, the Commissioner of Incometax, Punjab (r) etc. purporting to act under s. 5, sub-ss. (5) and
(7A) of the Indian Income-tax Act ordered theassessment of the
appellant firm to be don• by the Income-tax Officer. Special Circle, Ambala and not by the Income-tax Officer. B-Ward, Patiala,
who would ordinarily be the competent assessing authority for
the firm under s. 64 of the Indian Income-tax Act. On ~larch
12, 1953, the Income-tax Officer. Special Circle, Ambala, issued a
notice purporting to be under the Patiala Income-tax Act of
Samvat 2001 to the appellant firm for filing a return of its income and total world income as he believed that the income
had been underassessed.
The appellant then filed an application under Art. 226 of the Constitution in the High Court for
writs of prohibition, certiorari, quo warranto etc. against the
Income-tax Officer, Special Circle, Ambala, and the Commissioner of Income-tax, Punjab (r) etc. regarding the reassessment of
the income of the firm for the account year 1945-46. The High
Court dismissed the said petition and this appeal was filed on a
certificate granted by the High ~ourt. The contentions of the
appellant inter alia, were that the Income-tax Officer, Special
Circle, Ambala, had no jurisdiction to issue a notice under s. 34
1 S.C.R. SUPREME COURT REPORTS
893
of the Patiala Income-tax Act of Samvat 2001, and that only the
Income-tax Officer, B-Ward, Patiala,•was the competent authority as he was the locally situated Income-tax Officer and would
have jurisdiction under s. 64(1) of the Income-tax Act. The
transftr of the case by the Commissioner of Income-tax by his
order of November 4, 1954. was characterised as ultra vires and
incompetent.
The argument that the words of s. 13 of the
Indian Finance Act, 1950, did not include reassessment was
abandoned in view of the decisions of this Court in Lakshmana
Shenoy v. The Income-tax Officer, Ernakulam, [1959] S.C.R. 75r.
It was further contended that the Commissioner in acting under
s. 5(5) of the Patiala Income-tax Act was required to consult
the Minister-in-Charge whose place was taken by the Central
Board of Revenue under the Indian Finance Act, 1950.
Held, that although the Commissioner of Income-tax was
required to consult the Central Board of Revenue his failure to do
so did not render his order ineffective however wrong it might
be from the administrative point of view. The provision about
consultation must be treated as directory and the Commissioner's
power could not be questioned by the assessee on the ground of
failure to consult the Central Board of Revenue.
State of U.P. v. Manbo;J.han Lal Srivastava, [1958] S.C.R. 553,
K. S. Srinivasan v. Union of India, [1958] S.C.R. 1295, Montreal
Street Railway !Company v. Normandin, L.R. 1917 A. C. 170
and Biswanath Khemka v. The King Emperor, (1945) F.C.R. 99,
followed.
The Commissioner while transferring the case may have
referred to the Indian Income-tax Act and not to the Patiala
Income-tax Act but the exercise of the power would be referable
to a jurisdiction which conferred validity upon it and not to a
jurisdiction under which it would be nugatory:
Pitamber Vajirshet v. Dhandu Navlapa, I.L.R. 12 Born. 486,
followed. ·
A case which was not pending at the time of transfer
could not be transferred nnder sub-s. (7A) of s. 5 of the Patiala
Act but it could be transferred from one Income-tax Officer to
another under sub-s. (5) of s. 5 of the Patiala Act which was kept
alive for assessment and reassessment re la ting to previous
years. Sub-s. (7A) makes special provision for transfer of pending cases. and is not prejudicial to the general powers granted
by sub-s. (5).
Bidi Supply Co. v. Union of India, [1956j S.C.R. 267, referred to.
CIVIL
APPELLATE JURISDICTION:
No. 135 of 1958.
Ci vii Appeal
Appeal from
the
judgment and order 'dated
z960
L. Hazari ~Wal
f{uthjala
~.
The
lnco1ne~ta:¥
Officer, Special
Circle, A1nbala
Cantt.
L, Hazari Mal
Kuthiala
v.
The Inco1ne-tax
Officer, Special
Circle, An1bala
Can.ft.
Hidayatullah ].
894
SUPREME COURT REPORTS
[1961]
September 4, 1956, of the Punjab High Court in Civil
Writ Case No. 325of1955,
N. A. Palkhivala and J.B. Dadachanji, for the
appellant.
G. K. Daphtary, Solicitor.General of India, K. N.
Rajagopal Sastri and D. Gupta, for the respondents.
1960.
September 27.
The Judgment of the
Court was delivered by
HIDAYATULLAH J.-The appellant firm, L. Hazarimal Kuthiala of Kapurthala, moved the High Court
of Punjab under Art. 226 of the Constitution for writs
of prohibition, certiorari, quo warranto etc., against the
Income-tax Officer, Special Circle, Ambala and the
Commissioner of Income-tax, Punjab (1), Himachal
Pradesh, Bilaspur and Simla in respect of reassessment of the income of the firm for the account year,
1945-1946. The High Court dismissed the petition,
but granted a certificate under Arts. 132 and 133 of
the Constitution, and this appeal has been filed on
that certificate.
The firm carried on business as forest lessees and
timber merchants at Dhilwan in the former Kapurthala State: In that State, an Income-tax law was in
force, and prior to the integration of the State, on
April 10, 1947, the income of the firm for the account
year 1945-1946 (Sam vat. 2002) was duly assessed, and
the tax was also paid. Subsequently, political changes
took place, Kapurthala integrated into what was
known as Pepsu, and the Rajpramukh issued two
Ordinances in Samvat. 2005, by which all laws in
force in Kapurthala including the Income-tax law
ceased to be operative from August 20, 1948. The two
Ordinances instead applied laws in force in the Patiala
State to the area of the new State which included
Kapurthala, and the Patiala Income-tax Act, 2001,
came into force.
Later still, the Indian Finance Act,
1950 (26 of 1950), applied the Indian Income-tax Act
to the Part B States, which had emerged as a result
of political changes. Section 13 of the Indian Finance
Act, 1950, repealed the Income-tax laws obtaining in
the area of the Part B States except for the purposes
'
. '
";
l~'.
I
l S.C.R. SUPREi\IE COURT REPORTS
895
of levy, assessment and collection of i'ncome-tax and
1960
SU per-tax in respect of the pC'riod defined therein.
L
H .
.
If l
On March 12, 1955, the Income· tax Officer, Special . · f(:,~~,;~1 "J
0
Circle, Ambala, issued a notice purporting to be under
v.
s. 34 of the Patiala Income-tax Act of Sam vat. "2001
The Jucomc-tax
to the appellant firm calling upon it to file a return of Office" Spe"at
its income and total )VOrld income, because he had
c,,cle, .Jmbala
Gantt.
reason to believe that the income had been under.
assessed. Previous to this, on November 4, 1953, the Hidayatu!lah J.
Commissioner of Income-tax, Punjab(!), Himachal
Pradesh, Bilaspur and Simla, purporting to act under
s. 5, sub-ss. (5) and (7 A) of the Indian Income-tax
Act, ordered that the assessment of the appellant firm ._
would be done by the Income-tax Officer, Special
Circle, Ambu.la and "not by the Income-tax Officer,
B-Ward, Patiala, who ordinarily would be the competent authority nuder s. 64 of the Indian Income-tax
Act to assess the appellant firm.
The appellant firm
raised objections, but failed; and then filed the petition
under Art. 226 of the Constitution, out of which the
present appeal arises.
·
Numerous objections were taken in respect of the
competency of the proceedings before the taxing
authorities, but some of them are no longer· pressed.
An argument under Art. 14 of the ConHtitution has
now been abu.ndoncd, though it figured at earli~:
stages of the present ca.se.
A second point tl;_.t the
reassessment cannot be made under the P ,ciala Income-tax Act is not in dispute, because ·;he respondents before us stated that the reassess,.ient, if any,
would have to be done in accordance w.' ch the Kapurthala law, as it existed in the assessm• nt year (Sam.
vat. 2002). A third argument, name] ', that the words
of s. 13 of the Indian Finance Act, ·.q50, did not include reassessment., has also been abaudoned, in view
of the decisions of this' <Jourt in La'cshmana Shenoy
v. The Income.tax OJficer, Ernakulam (') and The Income-tax Officer, Bangalore v. K. 1-. Guruswamy (').
Only one point has been pressed be'orc us, and it is
that the Income-Tax Officer, Special Circle, Ambala,
had no jurisdicticn to issue a notice under s. 34, and
(•l [1959] s.c.R. 751.
(2) [1959] S.C.R. 785 .
S!J6
SUPREME COURT REPORTS
[1961]
1 ~ 60
that only the Income-tax Officer, B-\\Tard, Pa.tiala.,
L. 110,.,. Mal was the competent authority. Reliance is placed in
Kr<thiala
this conne.ction upon the provisions of s. 64(1) of the
v.
Indian Income-tax Act, under which the locally situn, I"'o"u-tax a.ted Income-tax Officer would have had jurisdiction in
Officer, sp"ial this case. The transfer of the ca.so by t.he CommissionCird~, ~;nbala er of Income-tax by his order dated November 4, 1953,
.".'.'... ·
is characterised as ultra vi res and incompetent, and it
Hidayatullah J. is this argument a.lone to which we need address ourselves in this appeal.
The Pa.tie.la. Income-tax Act contained provisions
almost similar to ss. 5(5) and 5(7 A) of the Indian
Income-tax Act.
Sub-section (5) differed in this that
the Commissioner of Income-tax was required to consult the Minister-in-charge before ta.king action under
that sub-section. The only substantial difference in
the latter sub-section was that the Explanation which
was added to s. 5(7 A) of the Indian Income-tax Act
as a. result of the decision of this Court in Bidi Supply
Co. v. Union of India(') did not find place in the Pa tie.-
Ia Act.
The Commissioner, when he transferred this
c.lse, referred not to the Patia.Ia. Income-tax Act, but
to the Indian Income-tax Act, and it is contended that
if the Patia.la. Income-tax Act was in force for purposes
of reassessment, action should have been taken under
bha.t Act and not the Indian Income-tax Act. This
argument, however, loses point, because the E>xercise
of a. power will be referable t-0 a jurisdiction which
confers validity upon it and not to a jurisdiction
under which \twill be nugatory. This principle is wellsettled. See l'itamber Vajirshet v. Dhandu Navlapa(').
The difficulty however, does not end there. The
Commissioner, it) acting under s. 5(5) of the Pa.tiala.
Income- tax Act. was required to consult the Ministerin-cha.rge. It is contended that the Central Boa.rd of
Revenue which, under the Indian Finance Act, 1950,
ta.keE the place of the Ministor-in.charge was not consulwd, and proof against the prosumptio11 of regularity of official acts is said to be furnished by the fa.ct
that under the Indian law no such consultation was
necessary, and the Commissioner, having purported
(i) [i 9s6J s:c.R. 267.
(2) I.L.R. 12 Bom. 486, 4119.
•·
• "
l S.C.R. SUPREME COURT REPORTS
897
to act under the Indian law, could not have felt the
'960
need of consultation with any higher authority. This, L. Hazari lliuJ
perhaps, is correct.. If the Commissioner did not act
Kuthiala
under the Patiala law at all, which enjoined consultav.
tion with the Minister-in-charge and purported to act The Income-tax
only under the Indian law, his mind would not be
Officer, Special
drawn to the need for consultation with the Central Circle, Ambala
Gantt.
Board of Revenue. Even so, we do not think that
_
the failure to commit the Central Board of Revenue Hidayatulla/i J.
renders the order of the Commissioner ineffective.
The provision about consultation must be treated as
directory, on the principles accepted by this Court in
State of U. P. v. Manbodhan Lal Srivastava(') and
K. S. Srinivasan v. Union of India('). In the former
case, this Court dealt with the provisions of Art.
320(3)(c) of the Constitution, under which consultation
with the Union Public Service Commission was necessary. This Court relied upon the decision of the
Privy Council in Montreal Street Railway Company v.
Normandin (3), where it was observed as follows :
" ...... The question whether provisions in a statute are directory or imperative ha_s_ very frequently
arisen in this country, but it has been said that no
general rule can be laid down, and that in every
case the object of the statute must be looked at. The
cases on the subject will be found collected in Maxwell
on Statutes, 5th Ed., p. 596 and the following pages.
When the provisions of a statute relate to the performance of a public duty and the case is such that to
hold null and void acts done in neglect of this duty
would work serious general inconvenience, or injustice
to persons who have no control over those entrusted
with the duty, and at the same time would not promote the main object of the Legislature, it has been
the practice to hold such prov.isions to be directory
only, the neglect of them, though punishable, not
affecting the validity of 'the acts done."
The principle of the Privy Council case was also applied by the Federal Court in Biswanath Khemka v. The
King Emperor (1), and there, as pointed out by this
(1) [1958] S.C.R. 533.
(3) L.R. 1917 A.C. 170.
(21 [1958] S.C.R. 1295, 1321.
(4) [1945] F.C.R. 99·
898
SUPREME COt:RT REPORTS
(1961]
19°°
Court, the words of the provision were even more
L Ii
. 11 1 emphatic a.nd of a prohibitory cha.ra.cter. The essence
· 1/,~~.'.~1 ; • of the rule is tha.t wherP consultation has to be ma.de
v.
<luring the performance of a. public duty and an omisThe Income-tax sion to do so occurs, the action cannot be regarded a.s
Offim, Spuial altogether void, a.nd the direction for consultation
Circle, Ambala may be treated as director.v a.nd its neglect, a.s of no
Cantl.
consequence to the result. In view of what has been
"
llida_m11<liah J- said in these ca.ses, t.he failure to consult t-he Central
Board of }{eYenue does not destroy the effect iveneRs
of the order passed by the Commissioner, however
wrong it might be from the administrative point of
view. The power which the Commissioner ha.d, was
entrusted to him, a.nd there was only a duty to consult
the Central Boa.rd of Hevenue. The failure to conform
to the duty did not rob the Commissioner of the
power which he exercised, and the exercise of the
power cannot, therefore, be questioned by the a.ssesscc
on the ground of failure to consult the Central Board
of R11venue, provision regarding which must be regarded as laying down administrative control and as being
d irect-0ry.
Learned counsel, however, contends that even if a.II
this be decided a.ga.inst him, he is still entitled to show
tha.t the tra.nsfor of the ca.so ca.n only take place under
sub-s. (7A) of s. 5 and not under sub·B. (5). According
to him, tho former sub-section deals with the transfer
of individual ca.ses, a.nd that inasmuch a.s there wa.s
no pending ca.seat the time, then, a.s wa.s ruled by this
Court in the Bidi Supply case ('), the tra.nsfor could
not be va.lid. In the absence of a.n Expla.na.tion similar
to the one a.dded to tho Indian Income-tax Act, he
contends that a case which wa.s not pending, could not
be transferred under sub-s. (7 A).
He contends a.lso
that snb-s. (5) deals not with the transfer of individual
ca.sea but with the distribution of work.
Tbe two sub-sections of s. 5 of the Pa.tia.la. Incometax Act read-a.s follows :
"(5) Income-tax officers shall perform their functions in respect of such persons or classes of persons
or of such incomes or classes of income or in respect of
(1) (1956] S.C.R. 267.
'
l S:C.R. SVPREME COURT REPORTS
899
such areas as the Commissioner of Income-tax may in
con'sultation with the Minister Incharge direct, and,
w.here such directions have assigned to two or more
{111.come-tax Officers, the same persons or classes of
persons or the same incornes o_r classes of income or
t.he same area, in accordance with any orders which
tbe Commissioner of Income-tax may in consultation
with the Minister Incharge make for the distribution
and allocation of work to be performed. The Minister
In charge may, with the previous approval of the Ijlasi-Khas, by general or special order in writing, direct
that the powers conferred on the Income-tax Officer
by or under this Act shall, in respect of any specified
case or class of cases, be. exercised by the Commissioner, and, for ·the purposes of any case in respect of
which such order applies, references in this Act or in
any rules made hereunder to the Income-tax Officer
shall be deemed to be references to the Commissioner.
(7 A)
The Commissioner of Income-tax may
transfer -any case from one Income-tax Officer subordinate to him to another, and the Minister Incharge
. may transfer any case from any one Income-tax
Officer to another .. Such transfer may be made at any
stage of the proceedings, and shall not render neces- ·
sary the re-issue of any notice already issued by the
Income-tax Officer from whom the case is transferred."
There can be _no doubt that sub-s. (7 A) authorises
the Commissioner to transfer individual cases. The
words "any case from one Income-tax Officer subordinate to him to another ", " such tmnsfer may be
made at any stage of the. proceedings " etc., clearly
indicate this. Sub-section (7 A) is, however, not applicable here, because in respect of the cognate sub-section of the Indian Income-tax Act it was ruled by this
Court that it could apply to a pending .case only. It
was to overcome this lacuna that the Explanation was
added by the Indian Parliament. This amendment
came in 1956, and the Patiala Act did not include a
simihi.r Explanation, because prior to 1956 the question had not arisen.
There is one other difie'rence
between the Patiala Act and the Indian Act. Whereas·
sub-s. (7 A) was introduced in the Indian Act by an
L. Haza.ri Mal
Kuthiala
v.
The 1nco1newtax
Offictr, Spicial
Circle, Ambala
C£lnlt.
Hidayatullah ].
L. Harari Afal
KtlthialiJ
v.
Thd
l1ico111t-fa1'
Officdr, Special
Citc/e, Arnba/a
Canll
Hidayatul/uli _/.
900
SUPRE1~1E COURT REPORTS
[196iJ
amendment, the corresponding sub-section was enacted at the same time as tho rest of the Patia.la Act.
Now, it is quite clear that a case which was not
pending at the time of transfer could not be trans.
ferrNI under
sub-~. (7 A) of s. 5 of the P:>t iala Act
The same reasoning must br- applied to that. sul~<
section, as it was applied to the Indian Act. Lea.rnf·d
counsel reforred us to an affidavit hv the Under Secretary, Central Board of Rcvenm., rep;·oduccd in Pa1malal Binjraj v, Union of India (1), which stated the
reason for the introduction of sub.s. (7 A).
It is a
little difficult to accept the affidavit as an aid to find
out the intention why a particular law or amendment
w1~s enacted, more so where the affidavit concerns
quite another Act of a different legislature. It is,
however, pertinent to remember that sub-s. (7 A)
expressly ga. ve the power to transfer pending cases,
but said nothing a.bout ca.se8 which were not pending.
The power to transfer such ca.see before they came
into being must, therefore, be found in some other
enactment. The Department contends that it would
fall within sub-s. (5) of s. 5, and points out that this
Court was not required to consider that sub-section,
br)cause the transfer of the cases dealt with in tho
Bidi Supply case(') was by an authority not named
in sub-s. (5) and therefor!' the transfer in those instances could not be held to be undor that sub-section.
The Department contends that the Commissioner of
Income-tax is mentioned both in sub-s. (5) and eub-s.
(7 A) and could derive his power from one or the other
or both.
The short question thus is whether an individual
case which was not a. pending case could be transferred from one Income-tax Officer to another under
sub-s. (5) of s. 5 of the Patia.la Act, which was kept
alive for assessment and reassessments relating to
previous a.sseBBment yearn.
Mr. Pa.lkhivala. a_rgues
that the words of the sub-section " such persons or
classes of persons or of such incomes or classes of
income or in respect of such areas" denote, by the
plural employed, a. <lealing with a group rather than
(1) [1957] S.C.R. 233, 246.
(2) [1956] S.C R. 267.
•
,·
1 S.C.R. SUPREME COURT REPORTS
901
an individual case.
He further contends that if
individual cases were held to be included in sub-s. (5),
then sub-s. (7 A) would be unnecessary and otiose. He
·argues that harmonious construction thus requires
that the two sub-sections must be taken to cover
different situations.
The last argument is hardly open aftrr the decision
. of this Court adverted to a1ready. If pending cases
alone were within sub.s. (7 A), those cases which were
not pending could not be said to have been provided
for, there. There is thus no overlapping at least in
so far as cases not pending were concerned.
An
arrangement hr their disposal would be a subject of
distribution of work and nothing much turns upon
the employment of the p"!ural number, because the
plural includeH the singular. Indeed, a single case
might well be in a class separate from others. Duplication of powers is sometimes noticeable in statutes,
and does not destroy the effectiveness of the powers
conferred. Section 24 of the Civil Procedure Code
dealing with tmnsfers of cases and the provisions of
the Letters Pat mt of the High Court are instances in
point. If a p uticular action is valid under one
section, it cannot be rendered invalid because the
identical action can also be taken under another section, and it makes no difference if the two empowering provisions are in the same statute. In any event,
sub-s. (7 A) wonld cut down sub-s. (5) only to the
extent the formL'r provides, and it has been held that
it was confined to pending cases only. Sub-secti(\ll (5)
was thus available for cases which were not pending,
and the case which was the subject-matter of the
Commissioner's order was not a pending case.
Mr. Palkhivala contends that sub-s. (5) merely
enables distribution of work, and does not deal with
transfers.
But where a case is not pending, an order
relating to it may take the form of transfer or an
arrangement for its disposal. There is nothing to
prevent the Commissioner, acting under sub-s. (5), to
arrange that the case of an assessee shall be disposed
of by a particular Income.tax Officer. The words of
115
L. Hazari Mal
Kuihiala
v.
The Income-tax
Officer, Special
Circle, Ambala
Gantt .
Hida;;atullah j.
L. llu:an ,\Jal
Kath1ulu
, ..
J'Ju ftlC01Jlf·ltlX
UfJictY, sp~ctaJ
Circlt, AmlnJ/ll
Can!t.
902
SUPREME COURT REPOHTS
[ I9&I]
sub-s. (5) that "Income-tax Offic<•rs shall perform
their functiorrn in respect of such persons ...... as the
Commi~Hioner ...... may ...... direct" <inly show that the
CommiAsioner mn.y direct that one Income-tax Officer
Ahall not and !!notlwr lncomr-t-Rx Cfficer sl1all, perform the functions in respect of such and such pnson
or per80lls.
The plural i11cluding the singular, the
order of thu Commissio11cr waH valid, becausu he
arra11ged aud distrilrnted work, and <lid not- se"k to
transfer any ca~e. It is, however, contemlcd that
this renders suL-s. (7 A) otioso. In 01u· opi11iu11, it does
nut.
Special 1irovisiu11 for transfer of pe11ding <'ases
is ·~JI that i". provided there, aud if ouch a transfer
takes pla<'e, the proviBions of sub-s. (7A) will be
invoked.
Tho8P provisions are to be rllad as 11ut prejudicing the g<'11eral powers granted b) sub-s. (5) and
vice versa.
For these reasons, tlie appeal fails, r.nd will ho dismissed with eusts.
Appeal dismi.ssed.
BURMAH SHELL OIL STORAGE AN'D
DISTRIBUTING CO., OF INDIA, LTD, AND
ANOTHER
v.
THE COMMERCIAL TAX OFJ.<'JCER AND
OTHERS
(A~D CONNECTgD APPEAL)
(S. K. DAS, M. HmAYATUI.LAn, K. C. Ihs GUPTA,
J.C. SHAH and X. HAJAGOPALA AYYA:SOAR, ,JJ.)
Sales Tax-Sale of motor spirit for aviation purposes lo aircraft
"' Ai"rport-Exemption from taxation-_Sale outside custu1ns barrier
---'J.t'hether salt u·itl1in State--A.viatio1i sp;rit loaded 011
board
aircraft taken out of cotrnlry-lf exported-" J::xport ", meamng of
-Bengal Motor Spint Sal<S Taxation Act, 1y41 (Beu. 5 of 1941),
"22, as amcnded-Co11slitutio11 of hidia, Art 286(1)(a)(b). J::xplanation.
.-
,
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