Commissioner of Agricultural Income-tax, Bengal vs Sri Keshab Chandra Mandal

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. LXXXVIII of 1949

Decision Date: 09 May 1950

Coram: Saiyid Fazal Ali, Mehr Chand Mahajan, B.K. Mukherjea

In the case titled Commissioner of Agricultural Income-Tax, Bengal versus Sri Keshab Chandra Mandal, the Supreme Court of India delivered its judgment on 9 May 1950. The petition was presented by the Commissioner of Agricultural Income-Tax for the Province of Bengal, and the respondent was Sri Keshab Chandra Mandal.

The matter was heard by a bench that included Justice Saiyid Fazal Ali, Justice Mehr Chand Mahajan and Justice B.K. Mukherjea, with reference to the earlier bench of Justices Das and Sudhi Ranjan. The official citation of the decision is 1950 AIR 265 and 1950 SCR 435, and it is also reported in subsequent citations such as D 1955 SC 249, R 1956 SC 604 (paragraphs 4, 11, 12).

The dispute concerned provisions of the Bengal Agricultural Income-Tax Act, 1944 (Act IV of 1944), especially sections 24 and 57, and Rule 11 made under the Act. The rule required that a declaration in a return of income be signed “in the case of an individual, by the individual himself.” The issue arose as to whether a return filed by an illiterate assessee, signed with the pen of his son, could be regarded as a validly signed return.

The return filed by the illiterate assessee, Sri Keshab Chandra Mandal, contained a vernacular inscription that read “Sri Keshab Chandra Mandal Ba: Sri Jugal Chandra Mandal,” indicating that the signature was affixed by his son, Jugal Chandra Mandal. The Appellate Tribunal of Agricultural Income-Tax, West Bengal, referred the question to the Calcutta High Court, asking whether, under the circumstances, the declaration signed by the son should be treated as a proper signature and therefore as a valid return.

The Calcutta High Court answered the reference in the affirmative, holding that the return was properly signed despite the son’s involvement. The Commissioner of Agricultural Income-Tax appealed this decision to the Supreme Court, contending that the statutory provisions and the rule indicated an intention to exclude the common-law principle “qui facit per alium facit per se” in matters of signature by an individual assessee.

The Supreme Court, by a majority of Justices Fazal Ali, Patanjali Sastri, Mukherjea and Das, held that the Bengal Agricultural Income-Tax Act and the rules framed thereunder clearly intended to bar anyone other than the assessee from signing the return. The Court observed that the record showed no physical contact between the assessee and the signature that appeared on the return, and therefore concluded that the return was not properly signed and could not be considered valid.

Justice Mahajan delivered a dissenting opinion. He argued that the question before the Court was specifically whether a return “signed by the illiterate assessee with the pen of his son” was valid. He reasoned that, in the absence of any evidence disproving physical contact, it must be assumed that the assessee did touch the pen or the son’s hand when the signature was made, and consequently the High Court’s affirmative answer was correct.

The Supreme Court consequently reversed the judgment of the Calcutta High Court. The appeal originated from the High Court of Judicature at Fort William, Civil Appeal No. LXXXVIII of 1949, and concerned the judgment and order dated 16 September 1948 delivered by Justices G.N. Das and R.P. Mookerjee in a reference made under section 63(1) of the Bengal Agricultural Income-Tax Act, 1944.

The appeal arose from a reference made under section 63(1) of the Bengal Agricultural Income-Tax Act, 1944, by the Appellate Tribunal of Agricultural Income-Tax, West Bengal. The factual background is set out in the judgment. Counsel for the appellant was K.P. Khaitan, assisted by B. Sen. No counsel appeared on behalf of the respondent. The judgment was delivered on 9 May 1950.

There was no serious dispute as to the facts leading up to this appeal. The material facts can be summarised as follows.

In response to a notice issued under section 24(2) of the Bengal Agricultural Income-Tax Act, 1944, the assessee—who is the respondent in this case—filed a return dated 3 April 1945. The return declared a total agricultural income of Rs. 335 for the assessment year 1944-45. Directly below the declaration, in vernacular script, the words “Sri Keshab Chandra Mandal” were written.

On 18 April 1945, the Agricultural Income-Tax Officer entered an order sheet stating that the matter would be taken up at the Bankura Dak Bungalow on 6 May 1945, and directed the officer’s office to inform the party to appear with all settlement records, vouchers and related documents.

On 6 May 1945, while the officer was at Bankura, the assessee filed a petition stating, inter alia, that he had been advised that the return previously submitted under the guidance of a school headmaster was not a proper return, that it contained numerous mistakes and omissions, and that it was therefore essential to file a fresh return. He prayed for fifteen days’ time to prepare a new return and also requested a return form. The petition was signed in vernacular as “Sri Keshab Chandra Mandal x Ba: Sri Jugal Chandra Mandal”. Beneath this signature appeared the signature of his pleader, H. Nandi.

Accompanying the petition was a Vakalatnama also signed in vernacular, reading “Sri Keshab Chandra Mandal x Ba: Sri Jugal Chandra Mandal of Balya”. In both signatures a cross-mark (x) appeared opposite the name of Sri Keshab Chandra Mandal. The Vakalatnama contained the declaration: “I hereby appoint on my behalf Srijukta Babu Hangsa Gopal Nandi, Pleader, to do all works in connection with this case and as I do not know to read and write I put in x mark in the presence of the undermentioned persons as a token thereof.” The cross-mark was attested by his son, Sri Jugal Chandra Mandal.

Having received the petition, the Agricultural Income-Tax Officer granted only one day’s time and fixed the next hearing for 7 May 1945 at 10 a.m. He directed the assessee to submit a fresh return and to produce account books and any other necessary papers. The order sheet further warned that, should the assessee fail to comply, the assessment would be made under section 25(5) of the Act.

On 7 May 1945, the assessee…

On the appointed date, the assessee did not attend the proceedings in person. His son, Sri Jugal Chandra Mandal, appeared accompanied by pleader Babu Hangsa Gopal Nandi. The son did not produce any letter of authority authorising him to act on behalf of the assessee. A return was filed that bore a vernacular signature reading “Sri Keshab Chandra Mandal Ba: Sri Jugal Chandra Mandal.” It was observed that this latter signature did not contain the cross-mark that had appeared in the earlier signature of the assessee.

The Agricultural Income-Tax Officer, in his assessment order, recorded that a fresh return had been submitted on that day and noted a “remarkable difference” between the two returns. The first return showed total agricultural income of Rs 335, whereas the revised return disclosed income of Rs 1,077-12-6. He described the situation as “really strange,” adding that the first return appeared to have been signed by the assessee himself, while the second return had been signed by the son, Jugal, on the assessee’s behalf. On the basis of those circumstances, the officer stated that he could place no reliance on either return and therefore made no assessment based on them. Nonetheless, the officer subsequently proceeded to assess the income at Rs 4,968-12-1 as the assessable amount.

The assessee filed an appeal against this assessment before the Assistant Commissioner, Agricultural Income-Tax, Bengal. By an order dated 14 August 1945, the Assistant Commissioner dismissed the appeal and confirmed the assessment, invoking section 35 (4)(a)(i) of the Act. The assessee then preferred a further appeal to the Income-Tax Appellate Tribunal. On 9 December 1947, the Tribunal admitted the appeal, holding, among other reasons, that the return filed on 7 May 1945 was a proper return and should be treated as such. Pursuant to section 63 (1) of the Act, the Commissioner of Income-Tax applied for a reference of certain questions of law to the High Court.

By its order dated 22 April 1948, the Tribunal referred the following question of law to the Calcutta High Court: “Whether in the circumstances of this case, the declaration in the form of return signed by the illiterate assessee by the pen of his son should be treated as properly signed and a valid return.” A Bench of the Calcutta High Court (Hon’ble Justices G. N. I. J. and R. P. Mookerjee) considered the matter and, in a judgment delivered on 16 September 1948, answered the question affirmatively. The Commissioner thereafter applied to the High Court for a certificate under section 64 (2) of the Act, which was granted. The present appeal therefore came before this Court for final determination of whether the High Court’s answer to the Tribunal’s question of law was well-founded. The records make it abundantly clear that there was no physical contact between the assessee and the signature appearing on the return filed on 7 May 1945, and that the phrase “in the circumstances of this case” prefaced the question referred to the High Court.

In this appeal, the question of whether the declaration contained in a return that had been signed by the assesse’s son on the assesse’s behalf could be treated as a proper and valid return was prefaced by the expression “in the circumstances of this case.” The entire proceeding, from the reference to the High Court to the present appeal, was conducted on the basis of that qualification. The Court therefore clarified that the present appeal did not require an examination of the propriety of the Income-Tax Officer’s decision to proceed to assessment without first giving the assesse an additional opportunity to affix his own mark to the return.

The High Court, in answering the question of law, relies upon observations made by Blackburn J. in The Queen v. The Justices of Kent (1846) L.R. 8 Q.B. 305 at p. 307, which stated: “No doubt at common law, where a person authorises another to sign for him, the signature of the person so signing is the signature of the person authorising it; nevertheless, there may be cases in which a statute may require personal signature.” After quoting this passage, the High Court explained that courts should not depart from the common-law principle qui facit per alium facit per se unless a statute expressly mandates a personal signature. Referring to various decided cases, the Court articulated the proposition that when the terms “sign” or “signature” appear without an express stipulation that a personal signature is required, the statutory provision is satisfied by a signature executed by an authorised agent.

Applying the aforesaid test, the High Court examined both the Agricultural Income-Tax Act and the associated rules and found that neither the Act nor the rules contained any requirement that an individual assesse sign his return personally. The Court further observed that imposing such a requirement would generate a manifest anomaly: while a natural-person assesse would be compelled to sign personally, other categories of assessee—such as a Hindu undivided family, a company, the ruler of an Indian State, a partnership firm, or any other association—are already authorised to file returns through duly appointed agents. To avoid the inconsistency that would arise if the Department’s interpretation were accepted, the High Court held that the common-law rule allowing an authorised agent to sign on behalf of the individual must prevail. Consequently, the High Court answered the point of law in the affirmative, holding that the return signed by the son was valid.

In response, the learned Standing Counsel for the Government of Bengal, Mr. K.P. Khaitan, presented a clear and concise argument that the Court should give effect to the plain meaning of the statutory provisions and the rules, regardless of the consequences. He submitted that, on a straightforward reading of the Act and the rules, there could be no doubt that the legislature intended an individual assesse’s return to be signed by the assesse himself, that is, personally. The counsel supported his position by citing a number of Indian and English decisions in which a personal signature had been held indispensable. He emphasized that the established rule in judicial decisions, and the principle recognised by the High Court, is that unless a statute expressly or by necessary implication excludes the common-law rule, the common-law rule must continue to apply.

The High Court, in the matter presently before it, articulated the principle that the common-law rule governing a particular procedural requirement continues to apply unless a statute expressly or by necessary implication or intendment excludes that rule. Accordingly, the Court determined that it was essential to scrutinise both the Agricultural Income-Tax Act and the subordinate rules to discover whether the legislature had manifested any intention to displace the common-law rule in this context.

The first step in that examination involved a reading of Section 2(14) of the Act, which defines the term “received” with respect to agricultural income. The definition expressly expands the concept of receipt to include situations where the income is received by an agent or servant acting on behalf of a principal or master. The Court observed that, had the legislature wished to permit the signature of a return by an agent, it could have achieved that objective by similarly expanding the definition of the word “sign” to encompass an agent’s signature. In the absence of such a definition, the statutory language does not indicate a legislative intention to allow agents to sign returns on behalf of the assessee.

The Court then turned to Section 25(2) of the Act, which obliges the Agricultural Income-Tax Officer, when not satisfied that a return filed under Section 24 is correct and complete, to issue a notice to the person who filed the return. The notice must specify a date on which the person must either appear before the Officer or produce, or cause to be produced, any evidence on which the person relies in support of the return. The provision expressly authorises the production of evidence by an agent of the assessee, thereby acknowledging the agent’s role in evidentiary matters while leaving the signature requirement untouched.

Section 41 confers upon the Agricultural Income-Tax Officer, the Assistant Commissioner, the Appellate Tribunal (for the purposes of Chapter V), and the Commissioner (for the purposes of Section 37) powers equivalent to those of a civil court under the Code of Civil Procedure, 1908, but only for a limited class of functions. Those functions include enforcing the attendance of any person, examining that person on oath or affirmation, compelling the production of documents, and issuing commissions for the examination of witnesses. Proceedings before these officers are deemed “judicial proceedings” within the meaning of Sections 193 and 228 of the Code of Criminal Procedure and for the purposes of Section 196 of the Indian Penal Code.

Further, Section 60 of the Act provides that any notice or requisition issued under the Act may be served as if it were a summons issued by a civil court, and it identifies the persons who may be served. However, the Act contains no provision that imports the Code of Civil Procedure’s rules on the signing or verification of pleadings into the context of filing an agricultural income-tax return. The Court noted that, had the legislature intended to allow a return to be signed either by the assessee himself or by an authorised agent, it could have readily added a clause adopting the Code’s provisions on signing and verification of pleadings, treating the return as if it were a pleading in a suit. The absence of such a clause, together with the explicit definition in Section 2(14) and the limited permissions in Sections 25, 41 and 60, led the Court to conclude that the statute does not intend to displace the common-law rule requiring the personal signature of the return by the assessee.

Section 35 and section 58 of the Act expressly permit an assessee to appear before the Assistant Commissioner, the Appellate Tribunal, or any Agricultural Income-Tax authority in connection with any proceeding instituted under the Act. The statutes further allow the assessee, when not required by section 41 to attend personally for examination, to be represented by a person authorized in writing. Such an authorized representative may be a relative of the assessee, a person regularly employed by the assessee, a lawyer, an accountant, or an agricultural income-tax practitioner. The provision clarifies that not every agent may act for the assessee; only agents of the specific categories mentioned are permitted to attend on the assessee’s behalf. To summarise, the omission of a definition of the word “sign” as encompassing a signature by an agent, together with the permission under section 25 for production of evidence by an agent and the permissions in sections 35 and 58 for attendance by an agent, and the failure to incorporate any provision applying the Code of Civil Procedure rules on signing and verification of pleadings to the return, cannot be regarded as wholly without significance.

Section 24 of the Act obliges the Agricultural Income-Tax Officer to call for a return in the prescribed form and to have it verified in the manner prescribed. Rule 11 of the Bengal Agricultural Income-Tax Rules, 1944, framed under section 57 of the Act, stipulates that the return required by section 24 must be filed in Form 5 and must be verified according to the method indicated therein. Form 5 contains a footnote stating that the declaration shall be signed: (a) by an individual himself; (b) by the manager or karta in the case of a Hindu undivided family; (c) by the principal officer for a company or by the ruler of an Indian State; (d) by a partner in the case of a firm; and (e) by a member of any other association. The note further requires the signatory to be satisfied that the return is correct and complete in every respect before signing, and it directs that any alternatives not applicable should be crossed out. It is useful to compare these requirements of rule 11 and Form 5 with those governing other procedural rules concerning appeals and related proceedings. Section 34 authorises an appeal from the Agricultural Income-Tax Officer to the Assistant Commissioner, and sub-section (3) of that section mandates that the appeal be in the prescribed form and verified in the prescribed manner. Likewise, section 36 provides for a further appeal to the Appellate Tribunal, and sub-section (4) of that provision also requires that such an appeal be submitted in the prescribed form and verified accordingly.

The Court observed that an appeal had to be filed in the form prescribed by law and had to be verified in the manner also prescribed.

Rule 13 specified the forms to be used for appeals filed under section 34 of the Act, while Rule 14 set out the forms for appeals filed under another provision of the Act.

Rule 15 then explained who was required to sign those appeal forms and the accompanying verification statements. It provided that the signature must be affixed by the individual himself in the case of a sole person; by the Manager or Karta in the case of a Hindu undivided family; by the principal officer of a company in the case of a company; by a partner of a firm in the case of a firm; by the principal officer of the State in the case of a Ruler of an Indian State; and by a member of the association in the case of any other association of individuals. In addition, the rule required that the authorised representative, if any, of the appellant also sign the same forms.

Rule 17 dealt with applications for refund of tax. Sub-rule (2) of that rule mandated that every refund application be signed by the claimant and, where a representative was appointed, by that authorised representative as well. The rule further allowed the applicant to present the refund application either personally or through the authorised representative.

Rule 22 required that whenever an application or a memorandum of appeal was signed by an authorised representative, that representative had to attach a written document establishing his authority and his acceptance of that authority to the signed paper.

Rule 25 stipulated that an appeal to the Appellate Tribunal must be presented either in person or by an authorised representative. Rule 28 prescribed that every such appeal be made in the form of a memorandum that was to be signed by the appellant and, if a representative existed, by the authorised representative, and that the memorandum had to be verified by the appellant.

The various prescribed forms ranging from Form 7 through Form 20 each contained separate spaces for the signatures of the appellant, applicant or claimant, as the case required, and for the signature of the authorised representative, if any. Form 23, which served as the notice of hearing of an appeal under section 36, required the attendance of the appellant or the respondent either personally or through an authorised representative.

Rule 47 provided that, subject to certain special provisions, the provisions contained in Part II of the rules governing the presentation, notices and hearing of an appeal before the Appellate Tribunal would also apply to the presentation, notices and hearing of a reference application made under section 63, treating such a reference as if it were an appeal. Rule 53 empowered the Tribunal, when it deemed necessary, to hear the applicant himself or his authorised representative.

A careful examination of the rules mentioned above showed that rules 15, 17(2), 28 and the associated forms required the appeal or application to be signed both by the appellant, applicant or claimant and by his authorised representative, if one existed. In contrast, Rule 11 and Form 5 required only the signature of the assessee, signed in the manner specified in those provisions.

The Court observed that Rules 17(2), 25 and 47 allowed an authorised representative of the assessee to present applications and appeals. In contrast, Rule 11 contained no provision authorising an authorised agent to present a tax return. The Court noted that such a provision could have been added to the rules by the Legislature if it had been intended.

The Court further held that wherever the law required the assessee, appellant or applicant to sign a document, the signature had to be made personally. This principle was supported by note (1) at the foot of Form 20, which dealt with a refund of tax under section 48(2). The note read: “In the case of a person not resident in British India, the above declaration shall be sworn (a) before a Justice of the Peace, a Notary Public, a Commissioner of Oaths, if the applicant resides in any part of His Majesty’s Dominions outside British India, (b) before a Magistrate or other official of the State or a Political Officer, if he resides in a State in India, and (c) before a British Consul, if he resides elsewhere.”

The Court clarified that the wording of this note did not mean that only a claimant for a refund under section 48(2) who lived outside India had to sign the application personally while other assessees, appellants, applicants or claimants could sign their returns, appeals or applications in any other manner. Rather, the note required that such a claimant’s signature be authenticated before the specified public officers by having the declaration sworn in their presence.

Consequently, the Court concluded that a personal signature of the assessee, appellant or applicant was necessary in every situation where the law demanded a signature. Authentication of that signature was required solely in the special case of a claimant for a tax refund under section 48(2).

The Court also listed additional reasons for insisting on a personal signature. It observed that the Act and the rules allowed several functions to be performed by an authorised representative, including the production of documents, the presentation of an appeal or application, and attendance in proceedings before the authorities. The term “authorised representative” was defined in Rule 2(a). In each instance, the Court noted, the authorised representative had to be duly authorised in writing. Under Rule 22, the authorised representative was required to file a written document setting out his authority and his acceptance of that authority.

The Court reasoned that, had the Legislature intended the signature of an agent on a return, a memorandum of appeal or any other application to be sufficient as the signature of the assessee, appellant, applicant or claimant, there would have been a rule prescribing the constitution of such an agency in writing and the filing of the written instrument constituting that agency, together with the agent’s acceptance of it. Since no such rule existed, the Court held that an agent could not sign a return or an appeal in place of the assessee.

Finally, the Court pointed out that, where the rules expressly required an agent to be authorised in writing for the mere presentation of an appeal, the written authorisation was mandatory. The absence of any provision allowing an unauthorised agent to sign a return, appeal or application confirmed the legislative intention that personal signatures were indispensable wherever required by the Act or the rules.

The Court observed that the requirement for filing a written authority on the record makes it impossible to infer that either the Act or the rules ever contemplated, or permitted, the use of an agent to sign a crucial document such as a return, an appeal or an application without a written authority authorising the agent, and without the agent producing such authority. Since the legislation contains no provision allowing such a practice, the effect would inevitably be that an unsigned agent could sign, a result that the statute does not sanction.

On a careful consideration of the provisions of the Act, the rules and the prescribed forms, the Court found numerous clear indications that the Legislature intended that the personal signature of the assessee, appellant or applicant be required whenever the law demanded a signature. By necessary implication the common-law principle “qui facit per alium facit per se” was excluded. The Appellate Tribunal and the High Court had previously pointed out certain difficulties in reaching this conclusion; the Court now addressed those observations. It was noted that insisting on the personal signature of an individual assessee might appear to create an anomaly whereby persons authorised to sign on behalf of other categories could have their returns signed by their own agents. The Court held that this argument begot the question, because none of the persons identified in the footnote to Form 5 are authorised to employ an agent to sign for them, and therefore no such anomaly could arise. The use of the word “himself” with reference to an individual in the statutory language further clarifies the position.

The Court rejected the contention that requiring a personal signature would cause hardship or inconvenience. It ruled that the meaning of clear statutory language cannot be altered on the basis of alleged inconvenience. Moreover, the Court observed that an illiterate person may affix a mark, which under the Bengal General Clauses Act falls within the definition of “sign”. If Form 20 for a tax refund under section 48(2) may be sent abroad for a claimant’s signature before authentication by a public officer, there is no hardship in sending Form 5 abroad for the same purpose without any further authentication. The suggestion that a leper lacking fingers could be unable to sign was deemed a rare circumstance that the Legislature could remedy if it so chose. Finally, the Court warned that failing to require a personal signature on returns, appeals or applications would permit signatures by agents who are not duly authorised in writing and who do not produce such authority, thereby undermining the provisions for penalty for filing false returns.

The absence of a definition of the word “sign” that would encompass an agent’s signature, together with statutory provisions that expressly limit the acts which may be performed by or through an authorised agent, suggests that the Legislature did not intend to allow an agent’s signature to replace the personal signature required by common law. Consequently, applying a penalty for filing false returns in situations where an agent signs may prove difficult to justify.

Turning to the judicial authorities cited, it is evident that courts have consistently required a personal signature even where the statutes at issue did not contain as explicit language as the present statute and rules. In Monks v. Jackson (1876) L.R. 1 C.P.D. 683, a case under section 1(3) of the Municipal Elections Act, 39 Vic., c. 40, which mandated that a nomination paper be delivered by the candidate himself or by his proposer or seconder to the Town Clerk, the court held that delivery by an agent did not satisfy the statutory requirement. In The Queen v. Mansel Jones (1886) L.R. 32 Ch. D. 337, the court ruled that a person charged with a corrupt or illegal practice in a municipal election, who was entitled under section 38 of the Corrupt and Illegal Practices Prevention Act, 1883, to be “heard by himself,” could not be represented by counsel or a solicitor.

Similarly, the English Court of Appeal in Re Prince Blucher (1931) 2 Ch. 70 decided that a proposal of composition signed by a debtor’s solicitors, submitted because the debtor was seriously ill and unable to sign, did not meet the requirement of section 16(1) of the Bankruptcy Act, 1914, which called for “a proposal in writing signed by him.” The court relied on the principles articulated in Hyde v. Johnson (1880) L.R. 5 Ex. D. 155 and In re Whitley Partners Ltd. (1880) L.R. 5 Ex. D. 155.

In the case of Luchman Bukshi Roy v. Runjeet Ram Panday (1873) 20 W.R-375, a Full Bench of the Calcutta High Court held that an acknowledgment by a mortgagee’s agent was insufficient for the purposes of section 1(5) of the Limitation Act (XIV of 1859), which required an acknowledgment signed by the mortgagee. Justice Rankin C.J. in Japan Cotton Trading Co. Ltd. v. Jajodia Cotton Mills, Ltd. (1926) I.L.R. 54 Cal. determined that a demand letter signed by the petitioning creditor’s solicitors did not constitute a notice under section 163 of the Indian Companies Act, which at that time required a demand “under his hand.” A comparable view was adopted by the Rangoon High Court in Manjeebhai Khataw & Co. v. Jamal Brothers & Co. Ltd. (1933) I.L.R. 11 Rang. 380 and by the Madras High Court in M.A. Kureshi v. Argus Footwear, Ltd. (1947) I.L.R. 9 Rang. Likewise, Wilson v. Wallani (1880) L.R. 5 Ex. D. 155 reaffirmed the principle that personal signature is required.

In C.T.A.C.T. Nachiappa Chettyar v. Secretary of State for India (1933) I.L.R. 11 Rang. 380, the court held that the registration of a firm on an application signed by the agents of the partners was ultra vires, because the rules framed under section 59 of the Income-Tax Act required an application to be signed by at least one of the partners themselves. This consistent judicial approach demonstrates that the common-law rule allowing an agent’s signature was not applied, as the specific statutory language in each case indicated a clear legislative intention to exclude it.

The Court observed that an application for registration of a partnership that had been signed solely by an agent of the partners was ultra vires, because the rules framed under section 59 of the Income-Tax Act required the application to be signed by at least one of the partners themselves.

In Commissioner of Income-tax, Madras v. Subba Rao (9), the Court held that the presence of the word “personally” in rule 6 of the Income-Tax Rules, which were made under section 59 of the Income-Tax Act, 1922, excluded a duly authorised agent of a partner from signing an application under section 26-A of the Act on the partner’s behalf for the registration of the firm.

These decisions demonstrated that the common-law rule concerning agent signatures was deliberately not applied, because the statutes in question were interpreted as expressing a clear intention to exclude that rule. The Court derived that intention from the language used in the statutes, such as the words “himself”, “by him”, “under his hand”, or “personally”.

The Court further noted that such an intention may also be inferred from the nature of the particular statute or from a harmonious reading of the various provisions of the statute together with the rules made thereunder. Accordingly, the Court pointed out that numerous provisions of the Bengal Agricultural Income-Tax Act, 1944, and the rules made under that Act provide strong indications that the legislature intended to bar reliance on the common-law rule with respect to the signature of the assessee, appellant, or applicant on returns, appeals, or applications.

The High Court, in its judgment, referred to the case of In the matter of Commissioner of Income-tax, C.P. and U.P. (1). It attempted to support its view by noting that, in that case, the Court rejected a return not because it had been signed by an agent, but because the power of attorney did not authorise the agent to sign. The Court in that earlier case chose to decide on the latter ground rather than to discuss the adequacy of an agent’s signature.

Consequently, the Court held that the In the matter of Commissioner of Income-tax, C.P. and U.P. decision could not be read as authority establishing that an agent’s signature was permissible at all. The Full Bench decision of the Allahabad High Court in Deo Narain Rai v. Kukur Bind (2), which the High Court cited, does not contradict the present view. In that decision, on a construction of section 59 of the Transfer of Property Act, the Court found that the Act contained no provision to exclude the application of the common-law rule.

The Allahabad High Court relied on section 123 of the Transfer of Property Act to argue for an exclusion, but Stanley C.J. pointed out that the language of that particular section was elliptical and lacked precise drafting, rendering it unsuitable for construing section 59. Thus, the reliance on section 123 could not be sustained as a basis for excluding the common-law rule.

Section 123 of the Transfer of Property Act was described as “elliptical” and lacking precise drafting, and therefore the Court held that it could not be relied upon for construing section 59 of the same Act. The judgment of Justice Banerjee was also cited, confirming that the Act contained no provision excluding a signature made by an agent, and that the words “on behalf of” in section 123 were considered surplusage. It is well-established that, where an agent’s signature is permissible, the agent’s writing of the principal’s name is treated as the principal’s own signature. However, this result follows only when the statute permits the agent to sign on the principal’s behalf. If, upon interpreting a statute, it is concluded that an agent’s signature is not permissible, then even a clearly authorized agent’s writing of the principal’s name cannot be regarded as the principal’s signature for the purposes of that statute. When a statute requires a personal signature, which may include a mark, the signature or mark must be made by the person himself, requiring physical contact between the individual and the signature or mark placed on the document. Consequently, the Court held that the appeal must be allowed and that the question referred to the High Court should be answered in the negative. No costs were ordered against the assessee, and the appellant Commissioner was directed to bear his own costs throughout.

The judges expressed their agreement, with Justices Fazl Ali, Patanjal Sastri, and Mukherjee each stating “I agree,” while Justice Mahajan added further observations. Justice Mahajan noted that the question of law referred to the High Court and answered affirmatively concerned whether, in the present case, a declaration in the form of a return signed by an illiterate assessee using his son’s pen should be treated as properly signed and valid. The High Court was not asked to decide whether an income-tax return could be validly signed by an agent in the principal’s name; rather, the framed question assumed that the illiterate assessee’s return was signed by the assessee himself, though the pen used belonged to his son. The physical act of affixing the mark was performed by the son’s pen or possibly his hand, and the son was not appointed as the father’s agent nor otherwise authorized to sign on his behalf. No evidence was presented, and the record contained nothing to show that the illiterate assessee did not touch the pen or his son’s hand when the signature was placed on the return. Moreover, the Indian Income-Tax Act and other statutes do not provide a precise definition of “signature,” and the General Clauses Act offers only a limited description, stating merely what the word “signature” shall include.

The term “signature” was held to include the affixing of a mark. In India it is a well-known practice that when the person who is to execute a document is illiterate, he simply touches the pen that another person uses to sign his name. Reference for this practice may be found at page 972, paragraph 1659 of Gour on The Law of Transfer. A signature made in such circumstances is regarded as the personal signature of the executant; it is his autograph. Consequently, no question of agency arises in that situation. The Court observed that the facts of the present case appear to fit this description, as can be inferred from the way the question was framed.

Nevertheless, the Court noted that without an inquiry into the specific circumstances under which the son’s pen was used to place the assessee’s signature on the return, it could not be assumed that the son was acting as the father’s agent or that he signed in an agency capacity. The Court further held that the issue of whether an agent may sign a return for an assessee lay outside the scope of the question that the High Court was asked to decide, and that the High Court’s answer to that limited question was correct. After careful consideration, the Court expressed reluctance to overturn the High Court’s decision by imposing an interpretation that the reference did not require.

The Court also observed that, because the hearing was conducted ex parte, no arguments supporting the High Court’s view were presented, as the respondent did not appear. Accordingly, the Court found it unnecessary to pronounce on the broader question of whether an agent may sign a return on behalf of a principal under the Indian Income-Tax Act, since that enquiry lay beyond the matter referred to the High Court.

In the absence of any material to the contrary, the Court was satisfied that the assessee had personally signed the return. It further held that, if the Income-Tax Officer had doubted whether the assessee had touched the pen or the hand of the person who affixed the signature, the officer should have summoned the assessee to appear and should have ascertained the exact circumstances in which the son’s pen was used.

Referring to the decision in Commissioner of Income-Tax, C.P. and U.P. (1), the Court reiterated that before accepting a return signed by an agent, the Income-Tax Officer must be satisfied of the agent’s authority. The Court extended this principle, holding that the same duty applied to an officer who considered rejecting a return of an illiterate assessee—or a person such as a leper—to ensure that there was no physical contact between the person and the mark or signature placed on the form.

The Court agreed with the observations of the other judge that physical contact between the person and the signature or mark is required, but it could not concur that such contact was absent in the present case.

The Court observed that the alleged physical contact between the assessee and his son’s pen had not been proved. The issue, to a certain extent, assumed such contact because it was alleged that the illiterate assessee’s signature had been made with the pen belonging to his son. However, the Court noted that this circumstance had not been eliminated by the material on record, and consequently the question could not be answered in the manner proposed by the learned brother.

The Court further expressed the view that Income-Tax officers, while discharging their functions, should not create unnecessary difficulties for the courts. In the present case, the Court held, if the Income-Tax officer had harboured any doubt, he ought to have summoned the illiterate assessee and asked him to place his mark in the officer’s presence on the return, rather than hastily proceeding to assess him under the penal provisions of the Act. The Court emphasized that persons who are ignorant and illiterate, and therefore not well-versed in income-tax law, must be dealt with more sympathetically than was done here, and they should not be subjected to the harsh penalty imposed on the present assessee.

Accordingly, the Court concluded that the appeal should be dismissed, yet nevertheless recorded that the appeal was allowed. The order also noted the appearance of the appellant’s agent, identified as P.K. Bose, and cited the authority (1) A.I.R. 1935 Oudh. 305.