ACHAMMA KURIAKOSE Vs. STATE OF KERALA

JUDGEMENT

(1.) THE petitioners in these O. Ps. are all assessees to agricultural income-tax under the Kerala Agricultural Income-tax Act, 1950. Assessment orders have been passed in all these cases and notices of demand issued under Section 30 of the Act, fixing the time for payment of the tax assessed. As per Section 40 of the Act, the assessees shall be deemed to be in default if they do not pay the tax assessed in accordance with the notice of demand.

(2.) THE petitioners challenge Section 40 as violative of Article 14 of the Constitution as, according to them, the assessing authority is invested with unguided power to fix the time for payment of the tax assessed. Sub-section (1) of Section 40 with its proviso is extracted below:

(3.) AS earlier stated, Sub-section (l) of Section 40 allows the assessing authority a discretion to fix the time for payment of the tax assessed. The section itself gives an indication as to the time to be allowed in the normal course. In the corresponding provisions in Section 220 of the Income-tax Act, 1961, the assessee is required to pay the amount specified in a notice of demand within 35 days of the service of the notice. The proviso to Sub-section (1) of Section 220 of the Act empowers the Income-tax Officer to fix a shorter time if he has reason to believe that it will be detrimental to the Revenue to allow the full period of 35 days. To fix a shorter period, he has also to obtain the previous approval of the Inspecting ASsistant Commissioner. The time fixed for payment of the tax demanded should be reasonable and should not be oppressive against the assessee. Section 40 cannot be construed as an instrument of oppression in the hands of the assessing authority and any misuse of power by the assessing authority is liable to be set aside by the appellate or revisional authorities under the Act, as the case may be, or in appropriate cases by this court under Article 226 of the Constitution. The petitioner in 0. P. No. 2826 of 1987 gets only five days' time under the notice of demand, exhibit P-2, served on him on March 13, 1987. The assessing authority was not justified in granting such a short time for payment and in imposing a penalty for non-compliance with the demand. The order imposing penalty amounts to a clear abuse of power vested in the assessing authority. Exhibit P-5 order cannot, therefore, be sustained and it is accordingly quashed. In all other cases, no steps have been taken treating the respective assessees as in default. I need only state that the assessees are entitled to a reasonable time for payment of the tax assessed and it is the duty of the assessing authority to fix a reasonable time in the notice of demand for payment of the tax assessed.