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2006 (6) TMI 105 - HC - Income TaxAppellant marketing committee is a 'local authority' within the meaning of section 10(20) of the Income-tax Act, 1961 or not - HELD THAT:- Since the Act did not provide any definition for the expression "local authority", this court had interpreted the same by reference to section 3(31) of the General Clauses Act, 1897, and answered the question in favour of the committee. The legal position has since the said pronouncement undergone a change inasmuch as the expression "local authority" has been given a restricted meaning in an exhaustive definition for purposes of section 10(20) of the Income-tax Act, 1961. Any determination of the question by reference to section 3(31) of the General Clauses Act, 1897, would, therefore, no longer hold the key to the correct understanding or interpretation of the expression as it now has to be understood or interpreted in the light of the amended provision. Reliance upon the provisions of the General Clauses Act, 1897, would, in fact, be permissible only in cases where the enactment in which the expression occurs does not itself provide for a definition or meaning to be given to the same. It is possible that an expression which as defined under the General Clauses Act, 1897, is, at the same time, also given a meaning or definition under a special enactment which meaning may be different from the one given in the former Act. The decision of this court in the previous round of litigation does not, therefore, provide a complete answer to the question that arises for the year under consideration in the present appeal. Whether the appellant-committee is a municipal committee within the meaning of section 10(20) of the Act, as amended with effect from April 1, 2003, by the Finance Act, 2002? - HELD THAT:- The most striking feature of the Explanation is that the same provides an exhaustive meaning to the expression "local authority". The word "means" used in the Explanation leaves no scope for addition of any other entity as a 'local authority" to those enlisted in the Explanation. In other words, even if an entity constitutes a "local authority" for purposes of the General Clauses Act, 1897, or for purposes of any other enactment for that matter, it would not be so construed for purposes of section 10(20) of the Act unless it answers the description of one of those entities enumerated in the Explanation. The appellant-committee is no doubt a statutory committee established under the provisions of a legislative enactment. It has been given a distinct nomenclature with definite statutory functions and powers. There is, therefore, no question of treating the appellant-committee as a municipal committee for it is neither known as a municipal committee under the enactment under which it is created nor recognised by fiction of law as such by the Income-tax Act or by any other enactment for that matter. That being so, the court cannot by a process of interpretation include an entity like the appellant into the provisions of the Explanation by drawing a comparison between the nature and functions which a municipal committee is expected to discharge with those discharged by the appellant. The argument that since the marketing committee takes care of the maintenance of the roads and other functions which ordinarily fall within the jurisdiction of a municipal committee, does not, therefore, lead us anywhere, for similarity in regard to some of the functions between the two entities would not in itself make the two expressions interchangeable. The Tribunal was correct in answering the question in the negative and holding that the appellant was not a local authority for purposes of section 10(20) of the Income-tax Act. The question is accordingly answered in the affirmative and this appeal, dismissed but in the circumstances without any orders as to costs.
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