TMI Blog1955 (4) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... n Income-tax Act is valid in law ? (2) If the answer to question No. 1 is in the affirmative, whether the Central Government had the power to pass an order with retrospective effect ? The assessee who owned during the relevant year of account certain rice mills and a cotton ginning and pressing factory, the assets of which were acquired about 40 years earlier, claimed depreciation allowance for the assessment year 1950-51 under section 10(2)(vi) of the Indian Income-tax Act on the basis of the actual cost of the assets acquired 40 years earlier. Prior to the assessment year 1950-51 when the Indian Income-tax Act was applied to all Part B States including the Hyderabad State, there was in existence the Hyderabad Income-tax Act, unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Income-tax Department invites us to reconsider this decision on the ground that the words of section 60A do not warrant this conclusion and that the modification referred to in the said section need not necessarily work in favour of the assessee, but can also work in favour of the Department. We have considered the views of the Income-tax Tribunal in its appellate order dated 12th December, 1953, and are not impressed by them. Section 60A deals primarily with avoiding any hardship or anomaly removing any difficulty caused as a result of the extension of the Indian Income-tax Act to the Part B States or to the merged territories granting exemptions, reduction in rate or making any other modifications in respect of income-tax in favour of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the burden of the tax on the whole or any part of the income over and above that which is authorised to be levied by the Act itself. It is frankly admitted by the learned advocate that this is not what is intended, and if this is not what is intended we fail to understand what other implication the word modification can have in regard to the whole or any part of the income of any person or class of persons unless it be to modify it in his favour as may be necessary or expedient having regard to the application of the Indian Income-tax Act to Part B States or other merged territories. Therefore, we see no reason to change the view we have taken in Commissioner of Income-tax, Hyderabad v. D.B.R. Mills ILR [1954] Hyd. 582; p. 210 infra. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifficulties which may arise in the application of the Indian Income-tax Act to Part B States or merged States, though even this power which is merely an enabling one, does not prima facie appear (though we do not wish to express any definite view on the matter) to authorise the Central Government to make any order to the disadvantage of the assessee who would be securing a benefit under the provisions of the Act. For the aforesaid reasons, we hold the explanation added to paragraph 2 of the Taxation Laws (Part B States) (Removal of Difficulties) Order, 1950, to be void. In the result the first question will be answered in the negative. The answer to the second question, which is dependent on the first question being answered in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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