COMMISSIONER OF INCOME-TAX, DELHI versus S. TEJA SINGH

Citation: [1959] SUPP. 1 S.C.R. 394 · Decided: 05-11-1958 · Supreme Court of India · Bench: T.L. VENKATARAMA AIYYAR · Disposal: Appeal(s) allowed

Judgment (excerpt)

394 
SUPREME COURT REPORTS 
[1959] Supp. 
r95B 
his administrative capacity. It follows from this con-
clusion that all considerations flowing from the basic 
Gullapalli 
idea of the proceedings before the State Government 
Nageswara Rao 
d 
l 
h 
h JI 
f 
and 011.,,. 
being of a quasi-ju icia c aracter, are w o y out o 
v. 
the way. ·It must, therefore,' be held tha~ the order of 
Andhra' Prade<h the State ·Government, impugned in this. case, is not 
State Road Trans- open to any interference by the courtR. I would, there-
port Corporation fore, dismiss the petition with costs. 
and Another 
· 
Sinha ]. 
November 5. 
ORDER 
In view of the opinion of the majority the order ap-
proving the scheme is hereby quashed and a direction 
issued to the 'first respondent to forbear from taking 
over any of the routes in which the petitioners are 
engaged in transport business. This will not preclude 
the State Government from making the necessary en-
quiry in regard to the objections filed by the petition-
ers in accordance with law. 
The petitioners will 
have liberty to file additional objections, if any. The 
parties to bear their own costs. 
COMMISSIONER OF INCOME-TAX, DELHI 
v. 
S. TEJA SINGH 
(T. L. VENKATARAMA AIYAR, P. B. GAJENDRAGADKAR 
and A. K. SARKAR, JJ.) 
I ncome-tax-P enalty-N ew assessee-F ailure to send estimate 
of tax-Absence of notice t-0 the assessee-Competency of Income-tax 
Officer to levy penalty-Indian Income-tax Act, r922 (XI of r922), 
ss. r8A(3), r8A(9), 22, 23, 28. 
The respondent who had not been assessed to income-tax 
prior to the assessment year 1948-49 made suo motu returns on 
July 4, 1949, showing an income of Rs. 4,494 and Rs. 31,646 
respectively, for the assessment years 1948-49 and 1949-50, but 
failed to send an estimate of the tax on his income as provided 
in s. 18A(3) of the Indian Income-tax Act, 1922. The Income-
tax Officer took action under s. 28 read withs. l8A(9) of the Act 
and imposed a penalty on him for the years 1948-49 and 1949-50. 
(1) S.C.R .. SUPREME COURT REPORTS 
395 
The Appellate Tribunal held that the order imposing the penalty 
was ultra vires on the ground that s. 28 would, in terms, ar;ily 
only when a person failed to furnish the return when he was re-
quired so to do by notice under s. 22 or s. 34 of the Act, and that 
there could be no such notices with reference to estimates of tax 
on income to be ·Sent under s. 18A(3). The High Court, on refer-
ence, agreed with the view of the Tribunal. 
Held, that in view of the legal fiction contained in s. 18A(9) 
of the Act that when an assessce has failed to comply with 
s. 18A(3) he "shall be deemed to have failed to furnish the 
return of his total income and the provisions of s. 28, so far as 
may be, shall apply accordingly ", the failure to send an estimate 
of the tax under s. 18A(3) should be treated as failure to furnish 
return of income under s. 22. 
Accordingly, it was cori1petent to 
the Income-tax authorities to impose a penalty under s. 28 read 
withs. 18A(9)(b) where there has been a failure to comply with 
s. 18A(3). 
The relevant provisions of the Indian Income-tax Act, 1922~ 
are set out in the judgment. 
CIVIL APPELLATE JURISDICTION: Civil Appca.l No. 
122 of 1957. 
Appeal from the order dated November 4, 1954, of 
the Punjab High Court (Circuit Bench) at Delhi in 
Civil Reference No. 15 of 1953. 
R. Ganapathy Iyer, R. H. Dhebar and D. Gupta, for 
the appellant. 
P. M. Mukhi, Gopal Singh for Udhai Bhan Choudhry, 
for the respondent. 
P. M. Mukhi and Ganpat Rai, for Dahnia ,Jain 
Aviation Ltd. (now Asia Udyog Ltd.) (Intervener). 
1958. November 5. The Judgment of the Court was 
delivered by 
C01n1nissioner of 
I nconie-tax 
.v. 
1"eja Singh 
VENKA'l'ARAMA AIYAR, J.-This is an appeal against 
Vcnk"t"rama 
tho judgment of the High Court of Punjab in a refer-
Aiyar J. 
cnce under s. 66(1) of the Indian Income-tax Act, 
1922, hereinafter referred to as the Act. 
The facts are that the respondent had not been 
assessed to income-tax prior to the assessment year 
1948-49. On July 4, 1949, he made suo motu returns 
showing an income of Rs. 4,494 for the accounting 
year 1947-48 being the previous year for the assess-
ment year 1948-49 and an income of Rs. 31,646 for 
396 
SUPREME COURT REPORTS [1959] Supp. 
the accounting year 1948-49 being the previous year 
Commissioner of for the . assessment year 1949-50. By orders dated 
Income-tax 
August 25, 1949, the Income-tax Officer assessed the 
v. 
income for

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