TMI Blog1964 (11) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... adjustment of tax liability against compensation due to the respondent, which has been directed by the High Court under rule 8-A can be made effective. - - - - - Dated:- 5-11-1964 - Judge(s) : K. SUBBA RAO., J. C. SHAH., S. M. SIKRI JUDGMENT The judgment of the court was delivered by SHAH J.----Agricultural income of the respondent-Raja Jagdish Prasad Sahi---was assessed by the Collector of Sultanpur to tax under the U. P. Agricultural Income-tax Act (3 of 1949) for the Fasli year 1359, corresponding to the period July 1, 1951, to June 30, 1952, and he was directed to pay the amount due in four equal instalments of Rs. 13,274-5-0 each. The respondent failed to pay the first and the second instalments which fell due respectively on December 9, 1952, and February 9, 1953. The revenue authorities imposed upon the respondent liability to pay Rs. 4,400 in the aggregate as penalty for default in payment of the two instalments. Pursuant to a certificate issued by the Deputy Commissioner of Sultanpur, proceedings were started against the respondent to recover Rs. 17,674-5-0 being the amount of the second instalment and penalty. The respondent then presented a petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2, is not liable to be set off against compensation payable to the intermediary. The first contention was not raised before the High Court. Nor are there sufficient materials on which a conclusion that all certificates due in respect of the compensation had been delivered to the respondent before he made a claim for adjustment under rule 8-A may be recorded. As early as 1953, the respondent had made a claim that the amount of tax due be set off against the amount of compensation payable to him, and the case which the revenue authorities seek to make out in this court is that compensation bonds were issued in the year 1955. Reliance in that behalf is placed upon certain averments made in the petition by the respondent before the High Court and upon recitals in the application for leave to appeal to this court against the order passed by the High Court. In paragraph 36, clause (4), the respondent had claimed before the High Court that if the amount or any portion thereof is held to be recoverable, it may be directed to be adjusted by the revenue authorities against compensation bonds of the face value of such amount given to the petitioner under the Abolition Act. In the grounds m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsequences set out in section 6, from the beginning of the date of vesting, ensue in the area to which the notification relates. By clause (d) of section 6, one of the consequences is that : " ... all arrears of revenue, cesses or other dues in respect of any estate so acquired and due from the intermediary or an arrear on account of tax on agricultural income assessed under the U. P. Agricultural Income-tax Act, 1948, for any period prior to the date of vesting shall continue to be recoverable from such intermediary and may, without prejudice to any other mode of recovery, be realized by deducting the amount from the compensation money payable to such intermediary under Chapter III. " Section 26 authorises the State Government to make rules for the purpose of carrying into effect the provisions of Chapter II of the Act in which section 6 occurs. Chapter III of the Act deals with the assessment of compensation. Section 68, which occurs in Chapter IV, provides that compensation payable under the Act shall be given in cash or in bonds, or partly in cash and partly in bonds as may be prescribed. Under section 26 read with section 6(d), rule 8-A was framed by the State Government ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the view of the Hight Court, was " still due ". It was urged, however, that rule 8-A is framed in exercise of the power reserved under section 26 of the Abolition Act to effectuate the provisions of clause (d) of section 6, and adjustment under the rule can only be made in respect of agricultural income-tax payable for any period prior to the date of vesting. The scheme of the Act, it was said, is that notwithstanding the vesting of the estate in the State by section 6, arrears of land revenue or other dues and agricultural income-tax continue to remain recoverable and the amount so continuing to remain recoverable is liable under the rules to be adjusted against compensation payable for compulsory termination of the rights of the intermediary. Relying under the clause " an arrear on account of tax on agricultural income assessed under the U. P. Agricultural Income-tax Act, 1948, for any period prior to the date of vesting " in section 6(d), it was urged that even if under section 3 of the U. P. Agricultural Income-tax Act, 1948, tax is recoverable on the total agricultural income of the previous year, it is still tax due for the year of assessment and, therefore, tax assessed o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
