MARIAMMA ANTONY v. TAHSILDAR, UDUMBANCHOLA — 1973 DIGILAW 285 (KER)

Judgment :- 1. The petitioner is an assessee to Agricultural Income-tax. For the years 1971-72 and 1972-73 an amount of Rs. 15,033.64 was due as arrears of Agricultural Income-tax. Therefore, the Agricultural Income-tax Officer, Kumali, sent a requisition under S.69(2) of the Revenue Recovery "Act of 1968 to the District Collector, Idikki, to realise the same. The District Collector authorised the Tahsildar, Udumbanchola, under S.73 of the Act to exercise the powers under the said Act for the realisation of the arrears. The petitioner had filed an appeal against the orders of assessment and that was pending when the Agricultural Income-tax Officer made the requisition to the Collector. The Tahsildar, Udumbanchola, furnished the Village Officer, Ayyappancoil, a demand in writing to proceed with the revenue recovery steps. Coming to know of this the petitioner filed an original petition, O.P. No. 2057 of 1973, before this Court and obtained an order of stay in C.M.P. No. 6557 of 1973 staying the revenue recovery proceedings on condition she remits an amount of Rs. 10,000/- in two monthly instalments. The first instalment of Rs. 5,000/- was paid on 16-7-1973 and the second instalment was due on 17-8-1973. Before the latter date the appeal filed by the petitioner against the orders of assessment was decided. The expenses allowed by the Agricultural Income-tax Officer was found to be insufficient. A larger amount was allowed and a re-computation of the taxable income and the tax payable was ordered to be dote by the Income-tax Officer. Ext. P1 is the order in appeal for the above assessment years and for the assessment year 1970-71. Possibly due to this decision in appeal the second instalment of Rs. 5,000/- due on 17-8-1973 payable as per the orders of this Court referred to earlier was not paid. The consequence was the stay petition stood dismissed as per the terms of the order of stay. On 20-8-1973 the Village Officer, Ayyappancoil, attached the standing crops (cardamom) in the petitioner's land and also attached 40 Kg. of cured cardamom kept in the store room of the petitioner. The standing crops and the cured cardamom were put to auction on 24-9-1973. As there were no bidders, the auction was postponed and ultimately the standing crops were sold in public auction on 15-10-1973 and the cured cardamom was sold in public auction on 17-10-1973. of cured cardamom kept in the store room of the petitioner. The standing crops and the cured cardamom were put to auction on 24-9-1973. As there were no bidders, the auction was postponed and ultimately the standing crops were sold in public auction on 15-10-1973 and the cured cardamom was sold in public auction on 17-10-1973. The right to collect usufructs (standing crops) from the petitioner's cardamom estate for the period ending 31-3-1974 was sold for Rs. 6,410/- and the cured cardamom was sold for Rs. 1,8000/- and the 3rd respondent was the bidder in both the auctions. Alleging that these revenue recovery steps have been taken behind the back of the petitioner and alleging that the mandatory provisions of the Revenue Recovery Act have not been followed in effecting the attachment and conducting the subsequent auction proceedings, this original petition has been filed for quashing those revenue 'recovery steps. 2. Three main points are raised before me. Firstly it is contended that as there was a reduction of the tax by the appellate decision, intimation as required under S.3(b)(ii) of the Kerala Taxation Laws (Continuation and Validation of Recovery Proceedings) Act, 1967 (Act 23 of 1967) has not been given to the assessee. As per this provision when Government dues are reduced in appeal the taxing authority shall give intimation of the fact of such reduction to the assessee. This has not been, according to the petitioner, done. The Agricultural Income tax Officer has not filed any counter affidavit denying this contention. So I have to take it that such an intimation has not been given It is no doubt seen from the counter-affidavit filed on behalf of the 1st respondent that the Income-tax Officer has intimated the 1st respondent of the change in the assessment. The petitioner contends that this is not enough as per the provision referred to above. An intimation to the assessee and an intimation to the Recovery Officer are mandatory and the failure to intimate the petitioner is fatal to the legality of the Revenue Recovery proceedings. The normal procedure when a person is assessed to tax is to serve a notice of demand asking him to pay the tax. Whenever there is a change in the tax amount, a fresh demand is called for. The normal procedure when a person is assessed to tax is to serve a notice of demand asking him to pay the tax. Whenever there is a change in the tax amount, a fresh demand is called for. But the Legislature thought that this need not be done in the case of a change occasioned by an appeal if already a demand has been made as per the original assessment. That is why S.3(b)(ii) was enacted in Act 23 of 1967. The person liable to pay the tax must know the amount payable by him which, if he pays, can avert compulsory steps under the Revenue Recovery Act. When there is a change in the tax liability, the amount payable by him should be definite and known to him and therefore a strict compliance of the provisions of S.3(b)(ii) is mandatory. A failure to give that intimation, according to me, vitiates the revenue recovery step for the changed amount. Therefore, the first contention urged by the petitioner's counsel has to be sustained. 3. The second contention seems to be equally tenable on the language of S.7 of the Revenue Recovery Act, 1968. Under this section the authorised officer (in this case the 1st respondent) has to furnish the Village Officer a demand in writing to be shown to the defaulter. If the defaulter fails to pay the amount demanded immediately the demand in writing is shown to him, the Village Officer is entitled to proceed with the attachment of the movable property of that defaulter. The authority to attach the movable property is obtained by the Village Officer only if the defaulter on being shown the demand in writing fails to pay the arrears. If the demand in writing is not shown to the defaulter, the Village Officer, on the language of S.7, has no authority to proceed with the attachment. In this case it is admitted by the 1st respondent that the demand in writing was shown only to the Superintendent of the estate belonging to the petitioner. The definition of "defaulter" in the Act does not take id any person who is managing the property of the defaulter. Therefore, it is not enough to show the demand in writing in the Superintendent. It should have been shown to the defaulter. Admittedly that has not been done. The definition of "defaulter" in the Act does not take id any person who is managing the property of the defaulter. Therefore, it is not enough to show the demand in writing in the Superintendent. It should have been shown to the defaulter. Admittedly that has not been done. Therefore, the Village Officer has no authority to make attachment in the instant case. S.8(3) of the Act does not apply to a case of attachment and sale of growing crops or ungathered products. What has been attached in this case is partly growing crops and partly cured cardamom. If the defaulter is absent when the person employed to attach goes to the place of attachment, there is no machinery for any substituted service or showing of the demand in writing. This seems to be a lacuna in the Act. So long as there is no provision for dispensing with showing the demand in writing to the defaulter, the terms of S.7 will have to be complied with in the matter of making attachment of growing crops. In this case there is no compliance with S.7 and therefore so far as attachment of the growing crops is concerned, it is defective and cannot be sustained. 4. Lastly it is contended that the provisions of S.17 have been violated by the 1st respondent in selling by public auction the right to take the usufructs from the estate for a period up to 31-3-1974. Under S.17 if the growing crops are fit for reaping or gathering they can be sold. If they are not so fit, they can only be reaped or gathered in due season and stored in proper places and then sold. In the first case alone a sale is permitted. In this case the attachment report in the file shows that the cardamom is fit for reaping or gathering, If that was so, that alone should have been sold. But what has been done is the right to take the usufructs upto 31-3-1974 is auctioned. This cannot be justified by the terms of S.17. Therefore, in the matter of the sale of the growing crops the provisions of S.17 have not been complied with and the sale by public auction of the growing crops cannot be sustained. But what has been done is the right to take the usufructs upto 31-3-1974 is auctioned. This cannot be justified by the terms of S.17. Therefore, in the matter of the sale of the growing crops the provisions of S.17 have not been complied with and the sale by public auction of the growing crops cannot be sustained. For all these reasons I bold that the steps taken by the respondent for realising the amount of tax are violative of the provisions of S.3(b)(ii) of Act 23 of 1967 and S.7 and 17 of Act 15 of 1968, namely, the Revenue Recovery Act. 5. In the result, I allow this original petition and quash the revenue recovery steps taken against the petitioner including the attachment of the growing crops in the cardamom estate belonging to the petitioner and also the attachment of the cured cardamom stocked by the petitioner. As the cured cardamom crops have already been sold for a sum of Rs. 1,800/-, it is not possible to restore the said cured cardamom crops to the petitioner. The petitioner will be entitled to get a sum of Rs. 1,800/ -being the sum realised by public auction of the said crops. The 3rd respondent is hereby restrained from taking the yield from the cardamom estate attached on 20-8-1973. The attachment of growing crop effected on that date is vacated. The original petition is disposed of as above. The parties shall bear their costs. . Allowed.