income-tax Officer and Another Vs. Shanti Parshad JaIn Others. - Court Judgment

Excerpt:
- - concededly, the respondents as well as the acquiring authorities have preferred appeals in this court against the award of the additional district judge and the same are still pending. -no suit be brought in any civil to set aside or modify any assessment order made under this act, and no prosecution, suit or other proceeding shall lie against the government or any officer of the government for anything in good faith done or intended to be done under this act. ' according to learned counsel, a bare reading of this section indicates that a civil court has no jurisdiction either to set aside or modify a completed act or an assessment order made by the competent authority under the act or to entertain any suit or other proceedings against any officer under this act for anything in good faith done by him or intended to be done by him.i. s. tiwana j. - this petition is directed against the order of sub-judge ist class, hissar, dated may 30, 1986, whereby while holding that the civil court had the jurisdiction in the matter, it has injuncted the income-tax officer, hissar, not to 'assess the plaintiff for capital gains in respect of the said compensation amount though he can do so in respect of the said income of the plaintiffs which has no concern in the said enhanced amount of compensation'. in order to appreciate the controversy raised in this petition, the following undisputed facts deserve to be noticed.respondent-assessees land measuring 192 kanals and 2 marlas was acquired by the state government in pursuance of a notification published under section 4 of the land acquisition act, 1894, on january 30, 1973, and they were dispossessed thereof on october 5, 1973, after the pronouncement of the award under section 11 of the said act. the assessees sought a reference under section 18 of the act against that award and as a result of the same, the additional district judge, hissar, vide his judgment dated january 23, 1979, enhanced the amount of compensation to a considerable extent. the respondents have concededly received this compensation including the interest awarded thereupon. they claim to have invested this entire amount in the form of national rural development bonds and this, according to their stand, absolves them from the liability to pay any capital gains tax under the income-tax act. concededly, the respondents as well as the acquiring authorities have preferred appeals in this court against the award of the additional district judge and the same are still pending. in a nutshell, the question of fairness of the compensation allowed to the respondent-assessee is sub judice.during the course of the abovenoted proceedings, the respondents filed a suit no. 757-c impugning the entire acquisition proceedings and that suit of theirs was decreed on march 7, 1983, by the learned senior sub-judge, hissar. the states appeal against that decree is again pending in the court of the additional district judge. in other words, the legality of the acquisition proceedings is also sub judice at the moment.while the abovenoted proceedings were going on between the plaintiff-respondents and the state government, one of the respondents, i.e., satinder kumar (plaintiff no. 4), was assessed to capital gains tax and qua others, the amount of interest received by them was also subjected to tax as their income during the relevant year. the plaintiffs filed appeals against the said assessments before the income-tax commissioner (appeals), chandigarh, who in the light of the judgment of the senior sub-judge dated march 7, 1983, referred to above, set those assessments aside with the direction that the income-tax officer should not take a final decision in the matter till the said litigation in the civil court was finalised.since the income-tax officer, hissar, issued notices to the plaintiffs to file their returns for the assessment years 1975-76 to 1981-82, they filed the present suit alleging in the light of the above-noted facts that the said officer had no jurisdiction in the matter and he should be restrained from proceeding against them under the income-tax act. this stand of the plaintiff-respondents has been contested by the revenue on a number of pleas including the one that the civil court had no jurisdiction in the matter in view of the provisions of section 293 of the income-tax act. the trial court has chosen to try this latter-mentioned issue as a preliminary issue and, as already indicated above, while holding that the civil court has the jurisdiction, has injuncted the income-tax officer in the manner stated in the opening part of this judgment.mr. ashok bhan, learned senior advocate for the petitioner-authorities, contends that the trial court has completely misconstrued the provisions of section 293 of the income-tax act while recording the abovenoted conclusion. this section reads as follows :'293. bar of suits in civil courts. - no suit be brought in any civil to set aside or modify any assessment order made under this act, and no prosecution, suit or other proceeding shall lie against the government or any officer of the government for anything in good faith done or intended to be done under this act.'according to learned counsel, a bare reading of this section indicates that a civil court has no jurisdiction either to set aside or modify a completed act or an assessment order made by the competent authority under the act or to entertain any suit or other proceedings against any officer under this act for anything in good faith done by him or intended to be done by him. though the matter appears to be concluded in favour of learned counsel by two earlier judgments of this court in seth harish chandra v. india and shri sukhdev chand, asst. cit, acquisition range v. shri kashmir singh bhullar (section 67 of the income-tax act referred to in the earlier case is in pari materia with section 293 mentioned in the later case), yet in order to elucidate his submission, he makes a reference to a division bench judgment of the patna high court in raja bahadur kamakhya narain singh v. union of india : [1964]51itr596(patna) wherein it has been observed (at p. 612) that the last words 'or intended to be done' occurring in section 293 of the income-tax act 'cannot apparently refer to a tortious act, because a suit for damages in respect of a tortious act must relate to a past act and not to an unknown future act'. according to learned counsel, it will be ridiculous and illogical to suggest or to hold that an assessment once completed cannot be called in question in a civil court but proceedings may be taken in such a court to prevent assessment altogether. i see merit in this submission of learned counsel. otherwise also, the matter, as far as this court is concerned, to my mind, stands concluded by the two judgments referred to above.the primary submission made by mr. n. c,. jain, learned senior advocate for the respondent-assessees, is that in view of the findings of the civil court to the effect that the entire acquisition proceedings were null and void and the adequacy of the compensation payable to the respondents having still not been finally determined, the proceedings under the income-tax act sought to be initiated by the income-tax officer would amount to nothing more than harassment as, according to him, the receipt of the compensation or the interest by his clients cannot be treated as income which has accrued to them. this pleas, even if it has to be given any weight, for the sake of argument, cannot, to my mind, lift the bar of jurisdiction created by section 293 of the income-tax act against a civil court. the pleas which the learned counsel for the assessees wants to raise obviously concern the merits of the case for which he has to seek his proper remedies under the income-tax act and before the authorities mentioned therein. the only other submission of learned counsel is that since the income-tax commissioner (appeals) had directed the income-tax officer not to proceed with or finalise the assessments against the respondents till the finalisation of the adjudication about the validity of the acquisition proceedings, the issuance of the present notices by him not only amounts to violation of that direction but is even without jurisdiction. again, even if this plea has some merit, the same has to be raised before the competent authority under the act and this by itself does not confer any jurisdiction on the civil court to go into the legality or the validity of the action of the income-tax officer. before this, it is apparent from the impugned order of the civil court that the stand of the income-tax officer is that the direction by the commissioner (appeals) only related to the assessment years other than those to which the present notices relate. further, it is stand of the income-tax officer that under the law (section 153) he is under an obligation to finalise the assessment proceedings within a period of two years from the end of the assessment year and in view of that, he could not indefinitely wait for the finalisation of the abovenoted proceedings in the civil court. anyway, the fact remains that the merits of the respondents case which, of course, are seriously disputed by the petitioner-authorities, cannot confer any jurisdiction on the civil court or remove the bar of jurisdiction brought in by section 293 of the income-tax act referred of above.in the light of the discussion above, while allowing this petition, i set aside the impugned order of the trial court and hold that the civil court had no jurisdiction in the matter. i make no order as to costs.