K MARIAPPA PILLAI Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) FOR the assessment year 1946-47, the petitioner was assessed as an individual by the Income-tax Officer, Tiruchirapalli. It is not in dispute that this ended in no assessment, because there was no income. Some time later, it was discovered that the petitioner had had dealings in combination with others as an association of persons under the name and style of "V. Muthuswami Pillai & Co" which had its commercial 4ivity within the jurisdiction of the Income-tax Officer, Dindigul. The said officer (at Dindigul) on information about the association of the writ petitioner in the combine, as above, after assessing the association issued a notice under section 29 of the Income-tax Act 1922, calling upon the petitioner to pay an ascertained sum towards the tax liability of "V. Muthuswami Pillai & Co.", in which the petitioner was a member. In the said notice dated September 29, 1950, the petitioner was informed that if he intended to appeal against the assessment he was at liberty to do so under sub-section (3) of section 30 of the Indian Income-tax Act, 1922. It is common ground that the petitioner did not file any such appeal, though it would appear from the record that others similarly plated as the writ petitioner, challenged similar notices issued to them in relation to the above, their commercial activity as members of an association of persons.

(2.) THE result was that the notice of demand which naturally followed an order of assessment became final in the eye of law and became binding on the petitioner as well. THE petitioner, however, took up the position that he, was not a member of "V. Muthuswami Pillai & Co." and left it at that I have already referred to the original order of assessment made on the petitioner as an individual by the Income-tax Officer, Tiruchirapalli. This order was dated December 30, 1946. This officer having had information about the income earned by the assessee as a member of the association of persons, as above, sought to revise the assessment under section 34 of the earlier Act following the prescribed procedure. It is not in dispute before me that such notices were issued and due enquiry was held by the Income-tax Officer when he revised his original order dated December 30, 1946. In the said enquiry, the other members of the quondam association of persons, such as Muthuswami Pillai and others, gave evidence before the Income-tax Officer, Tiruchirapalli. THE petitioner himself was cross-examined by the other members of the association of persons and in that it was elicited that he had a share in the combine of the persons who made up the association of persons and that though an agreement was not written UP, yet, there was an understanding as between the members as to the shares in which they should enjoy the returns of the commercial activity. Finally, the petitioner had admitted in the enquiry that he was a member of an abkari combine with one Manickam Pillai of Musiri, who was another member.

(3.) THEREFORE, for a second time when the petitioner had a full opportunity to disprove the case of the revenue, it was found that he was a member of the association of persons and that there is no escapement out of that finding. In this view of the matter, it cannot be said that the principles of natural justice are in any way violated, or that there has not been any effective opportunity given to the petitioner to prove his case that he was not a member of the association. THEREFORE, I am of the view that having regard to the facts of this case wherein the petitioner did have an ample opportunity to prove that the revenue's case was wrong and that he, having failed, at every such opportunity, to establish that he was not a member of the association, there has not been a violation of the principles of natural justice. The rule of adequacy is satisfied in the instant case, and even so, the rule of full opportunityThe first point is that the notice in question is issued by his Dindigul officer and it contains a demand for the payment of a much larger sum than is actually due by the petitioner.