§ (1) If any person who has paid tax charged under an assessment to Income Tax made for any year under Schedule D, or according to the Rules applicable to that Schedule, alleges that the assessment was excessive by reason of some error or mistake in the return or statement made by him for the purposes of the assessment, he may, at any time not later than three years after the end of the year of assessment within which the assessment was made, make an application in writing to the Commissioners of Inland Revenue for relief.
§ (2) On receiving any such application the Commissioners of Inland Revenue shall 224 inquire into the matter and shall, subject to the provisions of this Section, give by way of repayment such relief (including any consequential relief from Super-tax) in respect of the error or mistake as is reasonable and just.
§ Provided that no relief shall be given under this Section in respect of an error or mistake as to the basis on which the liability of the applicant ought to have been computed where the return or statement was in fact made on the basis or in accordance with the practice generally prevailing at the time when the return or statement was made.
§ (3) In determining any application under this Section the Commissioners of Inland Revenue shall have regard to all the relevant circumstances of the case, and in particular shall consider whether the granting of relief would result in the exclusion from charge to Income Tax or Super-tax of any part of the profits or income of the applicant, and for this purpose the Commissioners may take into consideration the liability of the applicant and assessments made on him in respect of other years.
§ (4) Any person who is aggrieved by the determination of the Commissioners of Inland Revenue on an application made by him under this Section may, on giving notice in writing to those Commissioners within twenty-one days after the notification to him of their determination, appeal to the Special Commissioners.
§ (5) The Special Commissioners shall thereupon hear and determine the appeal in accordance with the principles to be followed by the Commissioners of Inland Revenue in determining applications under this Section and, subject thereto, in like manner as in the case of an appeal to them against an assessment under Schedule D, and the provisions of the Income Tax Acts relating to such an appeal (including the provisions relating to the statement of a case for the opinion of the High Court on a point of law) shall apply accordingly with any necessary modifications.
§ Provided that neither the appellant nor the Commissioners of Inland Revenue shall he entitled to require a case to be stated for the opinion of the High Court otherwise. than on a point of law arising in connection with the computation of profits or income.—[Sir Henry Buckingham.]
§ Brought up, and read the First time.
§ Sir HENRY BUCKINGHAM
I beg to move, "That the Clause be read a Second time."
I think it would be unnecessary for me to detain the House on this matter, as the subject-matter of the Clause was fully discussed in Committee. But I may mention that the Clause had the approval of both sides of the House, and the Financial Secretary referred the matter to the late Attorney-General (Sir E. Pollock) to 225 draft a Clause, which is rather a difficult one. The result of these negotiations is that the Clause, which stands in my name and in the name of other hon. Members, has been drafted. It will not offend the susceptibilities of Somerset House, and I hope the Government will see their way to accept it as it stands. I would only like to say that it will be noticed that in this somewhat experimental Clause reference is only made to cases under Schedule D, but if the Clause proves successful in obtaining justice for the taxpayer next year it may be possible to extend the provisions to cases under Schedule E.
§ Mr. D. HERBERT
I beg to second the Motion.
I hope this Clause may be accepted. I might describe it as introducing for the first time a principle of justice to which the taxpayer is entitled. It is a very difficult point to deal with. I do not want to be hard on the Inland Revenue, but I hope that, as time goes on, we may be able to get a good working system under which the taxpayer will have what one may describe as equal rights with the tax collector in regard to rectifying cases of over-assessment.
§ Sir W. JOYNSON-HICKS
I am delighted that the last new Clause put down on the Paper is one which I can accept. The House may recall that on the Committee stage requests came from all parts of the Committee that a means of appeal should be provided for the Income Tax payers who have been over- 226 assessed. The late Attorney-General (Sir E. Pollock) made that appeal, and I asked that he should consult me in regard to the drafting of a Clause which would be fair to the Inland Revenue and to the Income Tax payer. My right hon. and learned Friend has been kind enough to consult me, and he gave a good deal of time to the Clause. It may not meet the wishes of every Member of the House, but it is a very great extension of the right of appeal to the subject. It is a matter in which I feel interested, and I am very glad to be able to accede to the request. The Clause really does introduce a new principle in Income Tax by giving the subject a right of appeal in regard to over-assessment.
§ Clause read a Second time, and added to the Bill.
§ Ordered, "That further Consideration of the Bill, as amended, be now adjourned."—[Colonel Leslie Wilson.]
§ Bill, as amended, to be further considered To-morrow.
§ The remaining Orders were read, and postponed.
§ It being after Half-past Eleven of the Clock upon Monday evening, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.
§ Adjourned at Eighteen Minutes after Twelve o'Clock.