Full Judgment Text
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PETITIONER:
M/S.POOTHUNDU PLANTATIONS PRIVATE LTD.
Vs.
RESPONDENT:
AGRICULTURAL INCOME TAX OFFICER,CHITTOOR, KERALA STATE, AND
DATE OF JUDGMENT: 15/07/1996
BENCH:
SEN, S.C. (J)
BENCH:
SEN, S.C. (J)
JEEVAN REDDY, B.P. (J)
CITATION:
JT 1996 (6) 601 1996 SCALE (5)384
ACT:
HEADNOTE:
JUDGMENT:
J U D G M E N T
SEN,J.
Leave granted.
This case arises out of an order of rectification of
mistake apparent on the face of record under Section 36 of
the Kerala Agricultural Income Tax Act. The Section, as it
stood at the material time, was as under:
"36. Rectification af mistake:
(1) The authority which passed
an order on appeal or revision may
at any time within three years
from the date of such order
passed by him on appeal or in
revision, and the Agricultural
Income Tax Officer may at any
time within three years from the
date of any assessment or refund
order passed by him, of his own
motion, rectify any mistake
apparent from the record of the
appeal, revision, assessment or
refund, as the case may be, and
shall within the like period
rectify any. such mistake which has
been brought to his notice by an
assessee:
The short question in this case is whether an
Agricultural Income Tax Officer can rectify the order passed
by his predecessor in office, on the ground that the
assessment order was passed by wrongly construing Section 12
of the Kerala Agricultural Income Tax Act. Section 12 before
its amendment stood as under:
"12. Carrying forward of loss:-
Where any person sustains a loss in
agricultural income in any year
the loss shall be carried forward
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to the following year and set off
against the agricultural income
for that year and if it cannot be
wholly so set off, the amount of
loss not so set off, shall be
carried forward to the following
year and so on, but no loss shall
be carried forward for more than
six years."
There can be no doubt that only an apparent error of
fact or law can be rectified by an officer. If the mistake
of law has to be established by construing the words of a
section to find its proper meaning, then such an error
cannot normally be a rectifiable error under Section 36. If
two views are possible, then obviously the error will not be
an error apparent from the record.
It is, however, well-settled that if the Supreme Court
has construed the meaning of a section, then any decision to
the contrary given by any other authority must be held to
be erroneous and such error must be treated as an error
apparent on the record.
In the instant case, on the strength of decision of
this Court in the case of Anglo-French Textile Company Ltd.
v. Commissioner of Income Tax, Madras (1953) 23 ITR 82, the
Assistant Appellate Commissioner took the view that his
predecessor had committed an apparent error of law in
allowing carry forward of losses in the computation of
agricultural income tax under the Kerala Agricultural Income
Tax Act. The question is whether Section 12 of the Kerala
Agricultural Income Tax Act must be interpreted in the
manner in which this Court has interpreted Section 24 of the
Indian Income Tax Act. This is not an easy question to
answer. In fact, the learned Single Judge before whom this
question was raised in the writ petition before the Kerala
High Court referred the question to a larger Bench for
decision. This very fact goes to show that this was not a
rectifiable error apparent on the record of the case. The
learned Single Judge of the Kerala High Court felt that the
question should be examined by a larger Bench.
Moreover, Section 24 of the Indian Income Tax Act and
Section 12 of the Kerala Agricultural Income Tax Act are not
identically worded. Even if it can be established by a long
process of reasoning that the meaning of the two sections is
the same, the alleged mistake committed by the Agricultural
Income Tax Officer cannot be treated as a mistake apparent
on the record.
Section 24 of the Indian Income Tax Act, 1922 provided
for setting off of losses incurred under one head against
income computed under any other head. Under Section 6 of the
Indian Income Tax Act, income had to be computed under
various heads. If an assessee incurred loss under one head,
he was entitled to set it off against income computed under
any other head. If the entire loss could not be set off in
any year, the balance, if any, had to be carried forward to
the next year. It was held by this Court in the case of
Anglo- French Textile Company Ltd. (supra) that before any
question of set off could arise, there must be (1) a loss
under one or more of the heads mentioned in Section 6, and
(2) income, profit or gain under some other head.
The case of the assessee before us is that the ratio of
this judgment cannot possibly apply to the Kerala Act on the
ground that the Kerala Act was concerned with only one head
of income (agricultural income). Here, there is no question
of setting off of any loss arising out of any head against
any income under another head. The scope of the two Acts and
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the content of the two sections are materially different.
The judgment of the Supreme Court rendered under the
provisions of the Indian Income Tax Act, 1922 could not
straightaway be applied to an assessment made under Kerala
Agricultural Income Tax Act.
We are of the view that there is considerable force in
the contention of the assessee. If any error had at all been
committed by the Agricultural Income Tax Officer, it was not
an error apparent on the record. The judgment of the Supreme
Court explaining the provision of Section 24 of the Indian
Income Tax Act, 1922 cannot be applied straightaway to
interpret Section 12 of the Kerala Agricultural Income Tax
Act. It is not necessary for us in this case to examine
Section 12 in depth to decide the question whether it will
have to be given the same meaning as was given to Section 24
of the Indian Income Tax Act, 1922 in the case of Anglo
French Textile Company Ltd. (supra), but suffice it to say
for this case that it is not an error of law apparent on the
record.
In that view of the matter, the appeal is allowed. The
judgment and order passed by the High of Kerala dated
8.10.1993 is set aside. The impugned order of rectification
passed by the Assistant Appellate Commissioner, pursuant to
the notice dated 4th August, 1984 under Kerala Agricultural
Income Tax Act, is also vet aside.
There will be no order as to costs.