TMI Blog1928 (7) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome which might be derived from forests or fisheries, both under the terms of Section 1 of Regulation XXV of 1802, of State these incomes were exempt from further taxation by the Government, and Section 3 of the Income-tax Act did not abrogate this exemption. The learned Judges considered the effect of the Permanent Settlement Regulation of 1802 and the terms of the grant to which the grant in the present case is similar and came to the conclusion that the income derived from forests and fisheries, in the permanently-settled estate was not liable to be taxed under the Income-tax Act. The learned Government Pleader attacks the correctness of this decision and contends that income from forests and fisheries is taxable unless it comes within the exceptions provided in the Income-tax Act. He urges that there must be specific legislation exempting such income and that it cannot be exempted by implication. Sitting as a Division Bench, we are bound by the decision of the Full Bench. We may observe that we entirely concur with the reasoning and conclusion of the learned Judges who were members of the Full Bench. Reliance is placed by the learned Government Pleader on Emperor v. Probhat C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outside the scope of the Act and a civil suit to recover it would not b barred by reason of Section 52. We do not discuss this point at length as we find the next point against the Appellant. 3. The next point is whether the Appellant is entitled to recover the money paid under a mistake of law.... As already observed, three payments were made on 5th July 1920, 25th April 1921, and 21st April 1922 and the suit was brought on 22nd June 1925. The suit in respect of the first two payments is clearly barred as it was brought more than 3 years after the date of payment. As the Court of institution closed on 20th April 1925 and re-opened on 22nd June 1925, the last payment was within the period of limitation. Granting that Section 14 does not apply to the case, the question is whether the amount paid on 21st April 1922 could be recovered in the circumstances of the case. It is well established that a payment made under a mistake of law cannot be recovered, but it is urged for the Appellant that the payment was made under duress or coercion and therefore the amount is recoverable. The decision in 45 Mad. 518 was on 21st February 1922. The assessment notice was dated 31st March 1922 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mistake, not of fact, but of could not be recovered back either on The ground that they were paid under duress or compulsion on the ground that they were paid in discharge of a demand illegally made under colour of an office. At page 745 he observes: The suppliants knew all the facts. They had present to their minds plainly, when these payments were made, that there was a question as to whether upon such servants as those in question, duty was payable. They themselves raised that question and they paid the duties. They could have resisted payment. They must have known that if proceedings were taken for penalties, it would be open to them in such proceedings to raise the question as to whether the duties were payable or not as they did in fact in 1903.... I think the most that took place was this, that the Officer of Inland Revenue told the suppliants that in his opinion and in the opinion of the Commissioners of Inland Revenue the duties were payable. 4. With regard to the cases of duress, the learned Judge observes after referring to certain passages in Leake on Contracts: In all those cases, in order to have that done which the person making the payment was entitled to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one, as the Defendants had the power to cut off water and gave judgment for the Plaintiff. Cave and Wills, JJ., held that the payment was a voluntary payment and could not be recovered back. Cave, J., observed at page 639: There is no case which lays it down that a payment under these circumstances is a compulsory payment. If it were so, the consequences would be very far-reaching. If that were so, no payment of rent to a landlord would be a voluntary payment. Wills, J., observed: It seems to me, in these circumstances, that it is idle to say that there is anything like duress; there was nothing in the nature of a threat used; it is simply the ordinary case of a person raising a contention when a demand is made, upon him. There is not sufficient to constitute duress so as to prevent a payment being a voluntary one. 6. The case would be different if for the purpose of getting an official act done a person pays something more than what is proper, for in order to get the act done he must pay the amount demanded, otherwise, the act would not be done. In such cases it can be said that the payment is not a voluntary payment nor is it a payment made under] a mistake of law. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act of Parliament gives fees, to receive what is allowed and nothing more. This is more like the case of money paid without consideration; to call it a voluntary payment is an abuse of language. 8. In both these cases the Plaintiff could not have got what he wanted without the payment, and therefore his payment could not be said to be voluntary, but a payment under duress. This point was the subject of decision by a Bench of this Court in a recent case. 9. Ramesam and Jackson, JJ., held in C.R.P. No. 535 of 1926 as follows: The Indian Law seems to be clear, namely, that a mistake that it is a pure mistake as to law in India, resulting in the payment by one person to another and making it inequitable that the payee should retain the money is No. ground for relief. 10. They refer to an observation of Lord Sumner in Sinclair v. Brougham [1914] A.C. 398. The learned Lord observes: There is now no ground left for suggestion as a recognizable equity the right to recover money in personam merely because it would be the right and fair thing that it should be refunded to the payer. 11. We hold that the amount paid on 21st April 1922 which is not barred under the three ye ..... X X X X Extracts X X X X X X X X Extracts X X X X
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