096-NLR-NLR-V-65-L.-C.-H.-PEIRIS-Appellant-and-THE-COMMISSIONER-OF-INLAND-REVNUE-Respondent.pdf
SANSONI, J.—Petris v. The Commissioner of Inland Revenue
457
1863Present: Sansoni, J.C. H. PEIRIS, Appellant, and THE COMMISSIONER OFINLAND REVENUE, Respondent
>S'. G. 596(63, with Application 390—M. G. Kcdviara, 47649
Income Tax Ordinance (Oap. 188)—Additional assessments—Wrong section quoted byCommissioner in support—Proceedings for recovery—Validity of certificateissued to Magistrate—Sections 64 (2) (a), 64 {2) (6), 65, 68 (I), 80 (2), 85.
Where, having accepted an assessee’s return and made an assessment in termsof section 64 (2) (a) of the Income Tax Ordinance (Cap. 188), the Commissionersubsequently purports to make additional assessments under section 64 (2) (5)when the correct procedure is to make them under section 65, a certificate issuedto the Magistrate in recovery proceedings under section 80 (1) is not invalidatedby the Commissioner’s mistake. Besides, in such a case, the assessee must seekhis redress by way of appeal before the authorities set up by the Ordinance.
“ It is well-settled that an exercise of a power will be referable to a jurisdictionwhich confers validity upon it and not to a jurisdiction under which it will benugatory. This principle has been applied even to cases where a Statute whichconfers no power has been quoted as authority for a particular act, and therewas in force another Statute which conferred that power. ”
Appeal, with application in revision, from, a judgment of theMagistrate’s Court, Kalutara.
N.E. Weerctsooria, Q.G., with N. E. Weerasooria (Jnr.), for theAppellant.
V. G. GunatUaka, Crown Counsel, for the Respondent.
Gut. adv. wit.
December 9, 1963. Sansoni, J.—
The Assistant Commissioner of Inland Revenue, aoting undersection 80 (1) of the Income Tax Ordinance, Cap. 188, issued a certificateto the Magistrate certifying that the appellant (who has also applied inrevision) had made default in the payment of Rs. 254,745 being incometax due from him. Summons was issued on the defaulter who showedcause against the tax being recovered.
After inquiry, the appellant was fined the amount of the tax undersection 85 ; in default he was ordered to undergo a term of six months ’simple imprisonment. He has appealed and filed an application in revision.
It transpired in the course of the inquiry that the appellant had origi-nally been assessed in respect of three consecutive years, and the disputewas whether the three additional assessments made said, served on the
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45SSANSONI, J.—Peiris v. The Comtnuaitmer of J!ntond £eunw
appellant in respect of those three yeans Tore legal or not. In makingthose additional assessments the Assistant Commissioner in each case pur -porfced to act in terms of Section 64 (2) (6) Cap. 188, which enables anassessor, if he does not accept a return of inooxne furnished by a person, toestimate the amount of the assessable income of such person and assesshim accordingly. The Assistant Commissioner was wrong when he pur-ported to act under Section 64 (2) (6), for he had aocepted the return andmade an assessment in terms of section 64 (2) (o). The correct procedurewould have been for him to act under section 65 and make an additionalassessment on the basis that the former assessment was less than theproper amount.
Tbe learned Magistrate thought that section 65 did not apply and thatthe assessor could have acted under section 64 (2) in the circumstances ofthis case. With respect, I am unable to agree. But it still remains to beconsidered whether the certificate issued under section 80 (1) is invalidatedby the mistake which the Assistant Commissioner made. In my opinionit is not. It is well-settled that an exercise of a power will be referable to ajurisdiction which confers validity upon it and not to a jurisdiction underwhich it will be nugatory. This principle has been applied even to caseswhere a Statute which confers no power has been quoted as authority for aparticular act, and there was in force another Statute which conferred thatpower. See Mohcmed Dastagiar Sahib v. Third Additional Income TaxOfficer1. Further, section 68 (1) of the Ordinance provides that “ no notice,assessment, certificate, or other proceeding purporting to be in accordancewith the provisions of this Ordinance shall be quashed, or deemed to bevoid or voidable, for want of form, or be affected by reason of a mistake,defect or omission therein, if the same is in substance and effectin conformity with or according to tbe intent and meaning of thisOrdinance …” The error made by the Assistant Commissioner
is covered by this provision.
There is another reason why it was not open to tbe defaulter in thiscase to raise the objection he did. The Act sets up a particular machineryfor the making of an assessment and the questioning of an assessmentwhen it has been made. An assessee who is dissatisfied with an assess-ment must seek his redress by way of appeal before the authorities setup by the Act. If the Assistant Commissioner makes a mistake of lawin quoting the wrong section in support of the additional assessments, andthe assessee feels that be can object to the assessments on that ground,his only course is to appeal. I would only add that although tbe AssistantCommissioner made an error while exercising a jurisdiction vested in him,his acts cannot be said to have been without jurisdiction.
Tbe Magistrate exercising jurisdiction under section 80 is acting like aCourt executing a judgment. The particular objection which the assesseeput forward is not one which could properly be raised at that stage, andit is not one which the Magistrate had jurisdiction to hear and decade.
* (1902) UL. W. *40.
MahamadagaUe Upcmanda Tkero v. Dunupothagama Sobitha Thero
459
There are certain objections which an assessee can raise before theMagistrate, as has been pointed out in several decisions of this Court,but this is not one of them.
Mr. Weerasooria relied on the case of Deputy Fiscal v. Tihiri Banda1in which it was held that a warrant issued for the arrest of a judgment-debtor was void because it was not signed by the Judge. There is noresemblance between that case and this one. That judgment certainlydoes not lend support to the argument that the Magistrate has nojurisdiction in this case, or that the additional assessments are voidbecause they purported to have been made under the wrong sectionof the Act.
I reject the appeal, for no appeal lay in this case, and I dismiss theapplication in revision.
Appeal rejected. Application dismissed.