S B ADITYAN Vs. FIRST INCOME TAX OFFICER

JUDGEMENT

(1.) THESE are petitions under article 226 of the Constitution filed by the same petitioners in relation to the same subject-matter. In Writ Petition No. 1393 of 1961 the prayer is for the issue of a writ of certiorari to quash the order of the First Income-tax Officer, City Circle IV, dated November 6, 1961, in G. I. No. 301-T. In Writ Petitions Nos. 276, 278, 279 and 280 of 1963, the petitioners pray for the issue of a writ of prohibition to forbear the Income-tax Officer, Special Investigation Circle, from proceeding with enquiries commenced under section 34 of the Indian Income-tax Act in regard to the assessment years 1955-56, 1956-57, 195758 and 1958-59 respectively. In Writ Petitions Nos. 277, 281 and 282 of 1963, the petitioners pray for the issue of a writ of prohibition restraining the Income-tax Officer, Special Investigation "A" Circle, from proceeding with further enquiries in pursuance of notices issued under section 22(2) of the Income-tax Act in relation to the assessment years 1961-62, 1959-60 and 1960-61 respectively The facts are briefly as follows : Dina Thanthi is a daily newspaper in Tamil having a very wide circulation. It is a business which was started by one S. B. Adityan in the year 1942. He was the sole proprietor of this business of carrying on a daily newspaper. He constituted a trust called the Thanthi Trust under a registered instrument dated March 1, 1954. The petitioners style themselves as the trustees of this trust.

(2.) THE deed recites the purposes of the trust to be(a) to establish the Dina Thanthi or Daily Thanthi as an organ of educated public opinion for the Tamil reading public (b) to disseminate news and to ventilate opinion upon all matters of public interest through the said newspaper and(c) to maintain the said newspaper and its press in an efficient condition devoting the surplus income of the said newspaper and its press, after defraying all expenses, in improving and enlarging the said newspaper and its services and placing the same on a footing of permanencyTHE founder of the trust, S. B. Adityan, appointed himself and two others, S. T. Adityan and B. R. Adityan, as the first batch of trustees to carry on and administer the trust. THE trustees were empowered to appoint one of themselves as the director, He was empowered to borrow money on security or otherwise, to enter into contracts for the trust, to operate on the banking accounts of the Daily Thanthi, to give valid receipt for moneys payable or owing to the trust and to do such other things and perform such other acts as the trustees may from time to time generally or specially autho rise him to do. S. B. Adityan was the first director so appointed. THE trust deed also provides that if for any reason the Daily Thanthi were to become extinct or defunct by ceasing to carry on the newspaper business the property of the trust may at the discretion of the trustees be employed for any charitable purpose.

(3.) THE intended purpose of writs is to direct observance of these principles in instances where they are overlooked or floutedTHE learned Advocate-General, appearing for the department, did not seek to support the order and quite frankly submitted that he was not anxious to sustain it in its present form at the present stage. He, however, very properly drew our attention to the fact that the petitioners themselves really invited the trouble and urged that the Income-tax Officer is not to be blamed. We have no doubt that the petitioners wanted to short-circuit the machinery of assessment and, therefore, approached the highest governmental quarters in New Delhi so that the Income-tax Officer can be overawed and forced to give a decision in their favour. We are not suggesting that the petitioners were guilty of any impropriety in the matter. THEy were not hopeful of making the Income-tax Officer see reason and to perceive the true legal position and, therefore, desired to have the matter dealt with at the highest level possible. This accounts for their correspondence with the Finance Minister or the Central Board of Revenue. However misguided an assessee may be, in his efforts to avoid tax, the Income-tax Officer should not become unsteady and get out of his moorings and succumb to the importunities of the assessee and give a decision prematurely, not warranted by the statute. We are not inclined to exonerate the Income-tax Officer wholly from the muddle into which he got, because of a clever move on the part of the petitionersIt is patent from the face of the order under challenge that the Income-tax Officer did not render any decision of his, but only voiced the view of the Central Board of Revenue. THEre was debate before us as to how far the Board can interfere with the course of assessment proceedings.