Judgment:
R.K. Manisana, J.
1. In this application under Article 226 of the Constitution of India, the petitioner, who is an assessee under the Assam Agricultural Income-tax Act, 1939, has challenged an order of the Agricultural Income-tax Officer made on June 10, 1986, refusing to change the 'previous agricultural year'.
2. Section 2(d) of the Assam Agricultural Income-tax Act, 1939, runs as follows :
''previous agricultural year' means the twelve months ending the 31st day of March preceding the year for which the assessment is to be made, or, if the accounts of the assessee have been made up to a date within the said twelve months in respect of a year ending on any date other than the said 31st day of March, or if the accounts of an assessee are made up to a date ending on the last day of a Bengali or Ramnavami year beyond the said 31st day of March then at the option of the assessee the year ending on the day to which his accounts have so been made up;
Provided that, if this option has once been exercised by the assessee, it shall not again be exercised to vary the meaning of the expression 'agricultural year' as then applicable to such assessee except with the consent of the Superintendent of Taxes or Agricultural Income-tax Officer and upon such conditions as he may think fit ;'
3. 'Previous agricultural year', as defined in Section 2(d), is the financial year immediately preceding the assessment year, but the assessee has an option to have his 'previous agricultural year' ending on the day to which his accounts have so been made up as is provided thereunder. The proviso to Section 2(d) clearly says that, if the option has once been exercised by the assessee, the assessee cannot change that 'previous agricultural year' as then applicable to him except with the consent of the Superintendent of Taxes or Agricultural Income-tax Officer and upon such conditions as he may think fit. It may be noted here that the Agricultural Income-tax Officer has held that the present is not a case of an exercise of first option.
4. The question which arises for consideration is under what circumstances consent is to be given or refused. On a reading of the proviso to Section 2(d), it appears that the proviso does not lay down explicit guidelines for the exercise of power, that is to say, there is no guideline under what circumstances consent is to be given or refused. Where the provision which confers discretion on the executive authority does not lay down guidelines for the exercise of that power, there is every possibility of causing real and substantive discrimination by arbitrary exercise of power and, therefore, such provision is violative of Article 14. However, it is well-settled that guidelines need not be found in the provision itself conferring the discretionary power upon the executive authority. The same may be collected from the framework of the provision and the purpose for which it is enacted (see State of Mysore v. M.L. Nagade and Gadag, AIR 1983 SC 762).
5. Let us now examine the implied circumstances under which the discretion can be exercised. The provision confers on the authority discretion to refuse consent. The proviso also empowers the authority to impose such conditions as he thinks fit having regard to the circumstances while giving consent for the change of 'previous year' or 'accounting year'. Therefore, the circumstances impliedly underlying the proviso is to give consent save in exceptional cases with or without condition, viz., to give consent is the rule and refusal is the exception.
6. Judicial review is not directed against the decision, but it is directed against the decision-making process. If we read what Lord Diplock has said in Council of Civil Service Unions v. Minister for the Civil Service [1984] 4 All ER 935, we can conveniently classify under four heads the grounds on which administrative action is subject to control by judicial review. The first 'illegality', the second 'irrationality', the third 'procedural impropriety' and the fourth 'improportionality'. By 'illegality' as a ground for judicial review is meant that the decision-maker must understand correctly the law that regulates the decision-making power and must give effect to it.
7. The question then is, whether the Agricultural Income-tax Officer committed an 'illegality' On a perusal of the impugned order, we find that he has not considered the matter in the light of principle discussed above. Therefore, the Agricultural Income-tax Officer has illegally exercised his jurisdiction. In the above view of the matter, the impugned order is not sustainable and is to be set aside.
8. In the result, the petition is allowed. The order of the Agricultural Income-tax Officer made on June 10, 1986, is set aside. The matter is sent back to the Agricultural Income-tax Officer for disposal afresh in the light of the above observations. No costs.