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1960 (8) TMI 4 - SC - Income TaxWhether section 14(2)(c) of the Indian Income-tax Act, as it stood on April 1, 1950, granted an exemption, and that this exemption was not affected by the amendment of the said provision in 1953 even though the amendment was retrospective from April 1, 1950, unless the Finance Act, 1950, which applied the Income-tax Act to this area was also amended? Held that:- The fiction in the amendment made the exemption to disappear as if it had never been granted, and unless there was a saving, the amendment must operate to obliterate the exemption. In fact, the whole purpose and intent of the amendment was to reach this result from the assessment year 1950-51 onwards, and there could be no saving. The argument assumes the premise that the Income-tax Act was incorporated in the Indian Finance Act, 1950, but there is neither precedent nor warrant for the assumption that when one Act applies another Act to some territory, the latter Act must be taken to be incorporated in the former Act. It may be otherwise, if there were words to show that the earlier Act is to be deemed to be re-enacted by the new Act. The Indian Finance Act, 1950, was concerned with the application of the Indian Income-tax Act to this area, which it did by amending the definition of "taxable territories" in the Indian Income-tax Act, and by applying that Act to the territory. Thereafter, the Indian Parliament could amend the Income-tax Act retrospectively, and the amendment would apply also to the new taxable territory. In our opinion, both the arguments are not valid. Appeal dismissed.
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