|
Advanced Search Options
Case Laws
Showing 501 to 520 of 827 Records
-
1962 (4) TMI 126
Issues Involved:
1. Validity of the lease executed on July 31, 1958.
2. Jurisdiction of the Rent Control and Eviction Officer to review or cancel orders.
3. Nature of the order passed by the Rent Control and Eviction Officer on January 17, 1959.
4. Jurisdiction of the State Government to restore a void order.
5. Validity of the sub-lease executed on October 12, 1958.
6. Rights of the appellant under the lease and sub-lease.
7. Locus standi of the appellant to maintain the appeal.
Detailed Analysis:
1. Validity of the lease executed on July 31, 1958:
The appellant argued that the lease executed by respondent No. 3 on July 31, 1958, was a valid lease, making the appellant legally a tenant of the accommodation. The court assumed the lease's validity for argument's sake but noted that the lease was executed in violation of a general order under Section 7(2) of the U.P. Control of Rent and Eviction Act, 1947, and thus rendered the execution of the lease a criminal offense under Section 8 of the Act.
2. Jurisdiction of the Rent Control and Eviction Officer to review or cancel orders:
The court held that the Rent Control and Eviction Officer had no jurisdiction to review or cancel the quasi-judicial order made on January 17, 1959, under Section 7(2) of the Act. The order of February 19, 1959, reviewing and canceling the January 17, 1959, order was void and ineffective. The State Government also had no power or jurisdiction to restore the void order.
3. Nature of the order passed by the Rent Control and Eviction Officer on January 17, 1959:
The court determined that the order of January 17, 1959, was a quasi-judicial order. The Rent Control and Eviction Officer had to decide several questions, including whether the accommodation was new or old, whether the Act applied to it, whether respondent No. 3 was liable for prosecution under Section 8, and whether Shamsher Bahadur was liable to eviction under Section 7-A. These questions required the officer to act in a judicial or quasi-judicial manner.
4. Jurisdiction of the State Government to restore a void order:
The court held that the State Government had no jurisdiction to restore a void order passed without jurisdiction. The State Government's order of February 8, 1960, restoring the February 19, 1959, order was without jurisdiction and was rightly quashed by the learned single Judge.
5. Validity of the sub-lease executed on October 12, 1958:
The sub-lease executed by the appellant in favor of Shamsher Bahadur was invalid and ineffective as it was made in defiance of the provisions of the Act, specifically Section 7(3). The Full Bench decision cited by the appellant did not apply to this sub-lease as it directly offended a provision of the Act itself.
6. Rights of the appellant under the lease and sub-lease:
The appellant's rights under the lease dated July 31, 1958, and the sub-lease dated October 12, 1958, were extinguished by the valid order of January 17, 1959, directing respondent No. 3 to let out the accommodation to Shamsher Bahadur. The appellant had no legal contractual relationship with the accommodation after the January 17, 1959, order.
7. Locus standi of the appellant to maintain the appeal:
The court noted that the appellant had no locus standi to maintain the appeal as it had submitted to the order of the Rent Control and Eviction Officer dated March 19, 1959. The appellant did not prefer any revision to the State Government against this order and had no right to complain against the quashing of the State Government's order dated February 8, 1960.
Conclusion:
The appeal was dismissed with costs, affirming that the appellant had no right to claim any relief in the special appeal. The court upheld the learned single Judge's decision to quash the State Government's order and restore the order of January 17, 1959, allotting the accommodation to Shamsher Bahadur.
-
1962 (4) TMI 125
Issues:
1. Whether the payment of compensation amounting to Rs. 35,000 has been rightly disallowed as capital expenditure within the meaning of section 10(2)(xv) of the Income-tax Act, 1922?
Detailed Analysis:
The case involved a reference under section 66(1) of the Income-tax Act, concerning the disallowance of a compensation payment as capital expenditure. The assessee, a public limited company engaged in the textile business, had entered into contracts to purchase machinery but later decided to cancel the contracts due to changed circumstances. The suppliers demanded compensation, totaling Rs. 35,000, upon cancellation. The assessee claimed this amount as a deduction under section 10(2)(xv), which was disallowed by the income-tax authorities and upheld by the Income-tax Appellate Tribunal. The Tribunal considered the payments as capital in nature, as they avoided a liability and future loss, thus disallowing the claim based on established legal principles (Countess Warwick Steamship Co. Ltd. v. Ogg). The Tribunal's decision was supported by the principle that expenses related to the means of carrying on a business may be of a capital nature.
The Tribunal's reliance on the Countess Warwick case was crucial in determining the nature of the compensation payments. In the referenced case, the payment made upon cancellation of a ship construction contract was deemed capital expenditure by Rowlatt J., as it was outside the scope of profits and gains, not directly linked to the business operation. Similarly, in Short Bros. Ltd. v. Commissioners of Inland Revenue, a payment for canceling a ship construction contract was considered revenue receipt as it pertained to the business of shipbuilding. The comparison of these cases highlighted the distinction between expenses related to the actual business operation and those related to the means of conducting the business, with the latter potentially being classified as capital expenditure.
The Tribunal's decision was deemed correct by the High Court, affirming that the compensation payments were rightly disallowed as capital expenditure. The Court concurred with the Tribunal's interpretation that the payments avoided a liability and future loss, aligning with the principle that such expenses, not directly linked to business operation but to its means, could be categorized as capital. Therefore, the question posed in the reference was answered in the affirmative, supporting the Tribunal's disallowance of the claimed deduction. The reference was to be returned to the Income-tax Appellate Tribunal with this decision for further proceedings.
-
1962 (4) TMI 124
Issues Involved:
1. Allowability of claims for losses under Section 10(1) of the Indian Income-tax Act.
2. Allowability of claims for losses under Section 10(2)(xi) of the Indian Income-tax Act.
3. Allowability of claims for losses under Section 10(2)(xv) of the Indian Income-tax Act.
Detailed Analysis:
Issue 1: Allowability of Claims for Losses under Section 10(1)
The claim under Section 10(1) was disallowed by the Tribunal on the grounds that the remission of debts by the bank was a voluntary act. The Tribunal reasoned that a loss must be involuntary to be deductible under this section. The Supreme Court's decision in Badridas Daga v. Commissioner of Income-tax was cited, which established that losses deductible under Section 10(1) must arise directly from the carrying on of business and be incidental to it. The Court concluded that the loss of pledged ornaments in a dacoity did not meet this criterion as it was a loss suffered by the bank as a holder of property, not as a businessman. Thus, the Tribunal's conclusion that the loss was not allowable under Section 10(1) was upheld.
Issue 2: Allowability of Claims for Losses under Section 10(2)(xi)
The claim under Section 10(2)(xi) was refused because the assessee did not demonstrate that the debtors were incapable of paying the loans or that the loans were bad or doubtful. The Tribunal noted that the solvency of the debtors was never questioned, and the bank could have legally recovered the loans. The Tribunal's decision was based on the specific provision for disallowance of bad and irrecoverable loans under Section 10(2)(xi). The counsel for the assessee conceded that the deduction could not be allowed under this section, and the Tribunal's decision was affirmed.
Issue 3: Allowability of Claims for Losses under Section 10(2)(xv)
The Tribunal initially overruled the claim under Section 10(2)(xv), stating that the remission of debts did not constitute expenditure as there was no actual outgoing from the bank's funds. However, the Court found that the act of adjusting the loans against the value of the stolen ornaments through account entries did constitute expenditure. The Court reasoned that the bank's decision to pay the value of the ornaments to maintain business goodwill and client confidence was a voluntary act of expenditure laid out wholly and exclusively for business purposes. The Court drew parallels with the English case Cooke v. Quick Shoe Repair Service, where voluntary payments to preserve business goodwill were deemed allowable deductions. Consequently, the Court concluded that the amounts of Rs. 48,891 and Rs. 1,21,760 for the assessment years 1953-54 and 1954-55 were allowable as deductions under Section 10(2)(xv).
Conclusion:
The reference was returned to the Tribunal with the answer that the claims for losses were allowable as deductions under Section 10(2)(xv) of the Indian Income-tax Act for the assessment years 1953-54 and 1954-55.
-
1962 (4) TMI 123
Issues:
1. Whether the transactions constitute speculative transactions in the nature of a business under section 24(1)?
2. Whether the losses are deductible as business losses under section 10 for the assessment years 1953-54 and 1954-55?
Analysis:
The case involved a reference by the Income-tax Appellate Tribunal, Madras, regarding the nature of certain transactions and the deductibility of losses for the assessment years 1953-54 and 1954-55. The main issue was whether the losses incurred by the assessee in the settlement of forward contracts in cocoanut oil constituted speculative transactions in the nature of a business under the first proviso to section 24(1) of the Indian Income-tax Act, 1922. The Tribunal initially had a difference of opinion on this matter.
The first proviso to section 24(1) restricts the set-off of losses in speculative transactions against profits and gains under the head of business, profession, or vocation. The court referred to relevant case law to clarify that the set-off under section 24(1) applies when the loss arises under one head and the profit against which it is set off arises under a different head. The court emphasized that the proviso carves out an exception to the main provision and should be interpreted accordingly.
The court discussed the interpretation of the first proviso to section 24(1) based on previous judgments. It highlighted that the proviso is a substantive provision dealing with the computation of profits and gains under the head of business, profession, or vocation. The court agreed with the view that the proviso applies not only to cases where losses are set off against different heads but also to cases where speculative losses are set off against profits from the same head.
Moreover, the court examined the nature of the transactions in question, emphasizing the difference between speculative and hedging transactions. It noted that the Tribunal's conclusion that the transactions were speculative seemed to be based on a misapprehension of the assessee's business activities. The court agreed with the view that the transactions were genuine hedging transactions rather than speculative, leading to a favorable decision for the assessee.
In conclusion, the court answered both questions in favor of the assessee, ruling that the transactions were not speculative and the losses were deductible as business losses under section 10. The judgment would be forwarded to the Appellate Tribunal as required by law.
-
1962 (4) TMI 122
Issues:
1. Interpretation of Section 24(2)(ii) of the Indian Income-tax Act, 1922 regarding set-off of losses in partnership businesses.
Detailed Analysis:
The case involved a reference under section 66(1) of the Indian Income-tax Act, 1922, where the assessee, an individual with income from partnership concerns, sought to set off losses from the previous year against his income for the assessment year 1956-57. The dispute arose from the dissolution of a partnership carrying on business in beedi leaves in the previous year, and the continuation of a similar business in partnership with different individuals in the subsequent year. The Income-tax Officer initially rejected the claim, stating that the dissolved firm ceased to exist, and the business carried on by the new partnership was not the same. However, the Income-tax Appellate Tribunal accepted the assessee's contention, emphasizing that both firms were registered and the business activity, i.e., trade in beedi leaves, remained consistent.
The specific question referred to the High Court was whether the assessee could set off his share of unabsorbed loss from the dissolved firm against his other business income for the assessment year 1956-57 under section 24(2) of the Act. The crux of the issue lay in the interpretation of section 24(2)(ii), which allows the carry-forward of losses if the same business is continued in the subsequent year. The Commissioner of Income-tax argued that the businesses conducted by the two partnerships were distinct despite dealing in the same commodity, thus failing to meet the continuity requirement of the provision.
The High Court analyzed the definition of "Business" under the Act and emphasized that the mode of carrying on business through partnerships did not alter the nature of the business itself. It clarified that the requirement under section 24(2)(ii) was for the same business to be continued by the assessee, not necessarily by the same firm or partnership. As the assessee was engaged in the trade of beedi leaves in both partnerships, the Court concluded that the condition for set-off was satisfied, allowing the assessee to claim the set-off as per his contention.
In conclusion, the High Court answered the question in favor of the assessee, highlighting that the continuity of the business activity by the assessee was the key factor in determining the eligibility for setting off losses under section 24(2)(ii). The decision underscored the importance of the nature of the business itself rather than the specific partnership structure through which it was conducted.
-
1962 (4) TMI 121
Issues Involved:
1. Validity of Customs Duty Levied on Charcoal Export
2. Legislative Competence of the State Council and Board of Regency
3. Application of Rajasthan Ordinance (No. 16 of 1949) to Sirohi
Issue-wise Detailed Analysis:
1. Validity of Customs Duty Levied on Charcoal Export
The appellant, Firm Ghulam Hussain Haji Yakoob & Sons, challenged the validity of the customs duty levied on the export of charcoal by the Controller of Sirohi. The appellant argued that the order levying the duty was invalid and ultra vires, asserting that the customs duty on charcoal export was not prescribed in the Sirohi Customs Act of 1944. The Act specified that customs duties could only be levied on goods mentioned in the Tariff at the rates specified therein. Since charcoal was not included in the list of commodities liable for export duty, the appellant contended that the levy was unauthorized.
2. Legislative Competence of the State Council and Board of Regency
The respondent, the State of Rajasthan, argued that the duty was validly levied by a resolution passed by the State Council and approved by Her Highness Shri Rajmata Saheba. The High Court upheld this view, but the Supreme Court found this interpretation erroneous. The Court held that while the State Council could reach decisions on new taxation, final orders had to be passed by the Ruler, or in this case, the Board of Regency, which was the legitimate authority during the Ruler's minority. The Court emphasized that the Board of Regency alone had the legislative authority to impose such duties, and the approval by Shri Rajmata Saheba, without formal consultation with the Board, was insufficient. Therefore, the customs duty levied on charcoal export was invalid as it lacked proper legislative sanction.
3. Application of Rajasthan Ordinance (No. 16 of 1949) to Sirohi
The respondent also argued that the duty could be sustained under the Rajasthan Ordinance (No. 16 of 1949), which authorized the Government to issue revised tariffs. However, the Supreme Court noted that this Ordinance came into force on August 4, 1949, and applied to Rajasthan as it was then constituted. Since Sirohi became part of Rajasthan only on January 25, 1950, the Ordinance did not apply to Sirohi at the relevant time. The Court further clarified that the laws applicable to Rajasthan prior to the merger could only be extended to Sirohi through appropriate legislation, which was not done in this case. Consequently, the respondent could not rely on the Rajasthan Ordinance to justify the customs duty on charcoal export.
Conclusion:
The Supreme Court allowed the appeal, declaring that the appellant was not liable to pay the customs duty in question. The orders passed by the Deputy Commissioner, Customs & Excise, and the Minister of Excise & Taxation, as well as the demand notice issued by the Collector, were quashed. The appellant was entitled to costs throughout.
Final Judgment:
Appeal allowed.
-
1962 (4) TMI 120
Issues Involved:
1. Validity of the notice under Section 80 of the Civil Procedure Code.
2. Requirement of a fresh notice under Section 80 after the withdrawal of the initial suit.
3. Variance between the plaint and the notice under Section 80.
4. Compliance with Section 80 requirements.
5. Bar under Section 40 of the Punjab Excise Act.
Issue-wise Detailed Analysis:
1. Validity of the notice under Section 80 of the Civil Procedure Code:
The Court emphasized that compliance with Section 80 of the Civil Procedure Code is mandatory. It was noted that the appellant's notice did not meet the requirements of Section 80, which mandates that the notice should state the cause of action and the relief claimed. The Court found that the notice lacked sufficient details to inform the government of the nature and basis of the claim and the relief sought. The notice did not provide specific sums claimed under each head, making it impossible for the government to consider settling the claim.
2. Requirement of a fresh notice under Section 80 after the withdrawal of the initial suit:
The Court dismissed the objection that a fresh notice under Section 80 was required after the withdrawal of the initial suit. The Court held that if the original notice satisfied the requirements of Section 80, the fact that an initial suit was filed and then withdrawn did not exhaust or extinguish the validity of the notice.
3. Variance between the plaint and the notice under Section 80:
The Court found a substantial variance between the plaint and the notice. The notice claimed a total of Rs. 74,935/8/3 without detailing how this amount was computed or relating it to specific items of claim. In contrast, the plaint detailed several heads of claims, amounting to Rs. 1,09,653/11/-, but confined the claim to Rs. 74,935/8/3. The Court noted that there was no means of identifying the claim in the plaint with that in the notice, leading to a complete variance between the two.
4. Compliance with Section 80 requirements:
The Court reiterated that Section 80 requires the notice to state the cause of action and the relief claimed. The notice should provide sufficient details to enable the government to consider the claim and decide whether to settle it. The Court found that the notice in this case failed to meet these requirements, as it did not provide specific amounts claimed under each head, nor did it give the government an opportunity to settle the claim.
5. Bar under Section 40 of the Punjab Excise Act:
The Court noted that the claim for the refund of Rs. 21,460/- was barred under Section 40 of the Punjab Excise Act, which states that when a license is canceled or suspended, the holder is not entitled to any compensation or refund of any fee paid or deposit made. This statutory provision further invalidated the appellant's claim for a refund of the deposit.
Conclusion:
The Court concluded that the entire claim in the suit must fail due to the combined effect of non-compliance with Section 80 of the Civil Procedure Code and the bar under Section 40 of the Punjab Excise Act. The appeal was dismissed, and each party was ordered to bear their own costs.
-
1962 (4) TMI 119
Issues Involved:
1. Was the decree a decree of a foreign court?
2. Could the Court at Gwalior order the transfer of the decree for execution in the Allahabad Civil Court?
3. If it could not, then was the decree executable at Allahabad under Sections 43 & 44 of the Code of Civil Procedure?
4. Could the respondents-judgment debtors take an objection to the execution of the decree on the ground that it was an absolute nullity, being the decree of a foreign Court?
Issue-wise Detailed Analysis:
1. Was the decree a decree of a foreign court?
The court examined the nationality of the decree passed by the Gwalior Court on November 18, 1948. At the time of the decree, Gwalior was considered a "foreign court" as per Section 2(5) of the Indian Code of Civil Procedure (Act V of 1909). The definition of a "foreign court" was a court situated beyond the limits of British India and not established or continued by the Central Government. The court held that the Gwalior Court fell within this definition, making the decree a foreign judgment. Since the respondents did not submit to the jurisdiction of the Gwalior Court, the judgment was considered a nullity outside the United State (Madhya Bharat).
2. Could the Court at Gwalior order the transfer of the decree for execution in the Allahabad Civil Court?
The court discussed the power of the Gwalior Court to transfer the decree for execution. The Gwalior Court, governed by its own Code of Civil Procedure at the time of passing the decree, did not have the authority under the Indian Code to transfer the decree. The court held that the Gwalior Court, which made the order of transfer in September 1951 under the Indian Code, was a different court from the one that passed the decree under the Gwalior Code. Therefore, the transfer order was not valid under Sections 38 and 39 of the Indian Code.
3. If it could not, then was the decree executable at Allahabad under Sections 43 & 44 of the Code of Civil Procedure?
The court reviewed Sections 43 and 44 of the Indian Code of Civil Procedure. Section 43, as amended, did not apply to decrees passed by civil courts in Indian States before they became Part B States. Similarly, Section 44, which allowed for the execution of decrees of revenue courts in Part B States, was not applicable to civil court decrees. The court concluded that neither Section 43 nor Section 44 provided a basis for executing the Gwalior decree in Allahabad.
4. Could the respondents-judgment debtors take an objection to the execution of the decree on the ground that it was an absolute nullity, being the decree of a foreign Court?
The court held that the respondents could object to the execution of the decree on the ground that it was a nullity. The decree, being a foreign judgment, was not enforceable in British India without a specific provision allowing its execution. The court cited previous judgments to support the view that a decree of a foreign court, to which the defendant did not submit, is a nullity and cannot be enforced outside the jurisdiction of the court that passed it.
Conclusion:
The Supreme Court dismissed the appeal, holding that the decree of the Gwalior Court was a decree of a foreign court and not executable in Allahabad. The Gwalior Court did not have the authority to transfer the decree under the Indian Code, and Sections 43 and 44 of the Code did not apply to make the decree executable. The respondents were entitled to object to the execution on the ground that the decree was a nullity.
-
1962 (4) TMI 118
Issues Involved:
1. Validity of Section 6(2) of the Mysore Tenancy Act, 1952.
2. Validity of the notification issued under Section 6(2) on March 31, 1952.
3. Alleged infringement of fundamental rights under Articles 14, 19(1)(f), 26, 31, and 31A of the Constitution.
4. Distinction between irrigated and non-irrigated lands.
5. Absence of minimum rent provision.
6. Consistency between the general rule in Section 6(1) and the exception in Section 6(2).
Issue-wise Detailed Analysis:
1. Validity of Section 6(2) of the Mysore Tenancy Act, 1952:
The appellant challenged the validity of Section 6(2) of the Mysore Tenancy Act, 1952, arguing that it infringed upon his fundamental rights. The court noted that the Act was intended to regulate landlord-tenant relations and provide relief to agricultural tenants, similar to the Bombay Tenancy and Agricultural Lands Act, 1948. The court found that the provisions of Section 6 of the Mysore Act were substantially similar to those of the Bombay Act, which had already been upheld as valid by the Supreme Court in "Vasantal Maganbhai Sanjanwala v. The State of Bombay [1961] 1 S.C.R. 341". Therefore, the court concluded that the validity of Section 6 of the Mysore Act was covered by the earlier decision and upheld its constitutionality.
2. Validity of the Notification Issued Under Section 6(2) on March 31, 1952:
The appellant contended that the notification issued under Section 6(2) was invalid because it was inconsistent with Section 6(1). The court examined the scheme of the Act and found that Section 6(1) prescribed a maximum rent ceiling, while Section 6(2) allowed the government to fix a lower rate or any other suitable basis for rent. The court held that Section 6(2) was an independent provision and not an exception to Section 6(1). The notification, which classified lands into Maidan and Malanad categories and fixed different maximum rent rates, was found to be consistent with the Act's provisions. The court concluded that the notification did not amend Section 6(1) and was valid.
3. Alleged Infringement of Fundamental Rights:
The appellant argued that Section 6(2) and the notification infringed his fundamental rights under Articles 14, 19(1)(f), 26, 31, and 31A of the Constitution. The court found that the Act aimed to improve the economic and social conditions of agricultural tenants, aligning with the policy of social justice. The court rejected the argument that the absence of explicit reference to social justice in the preamble distinguished the Mysore Act from the Bombay Act. The court concluded that the Act's provisions were intended to achieve social justice and did not infringe upon the appellant's fundamental rights.
4. Distinction Between Irrigated and Non-Irrigated Lands:
The appellant contended that the Mysore Act did not distinguish between irrigated and non-irrigated lands, unlike the Bombay Act. The court held that the absence of such a distinction was not essential for the validity of the Act. The Act's purpose was to prescribe a maximum rent ceiling, and it was not necessary to classify lands into irrigated and non-irrigated categories. The court found that the absence of this classification did not introduce any infirmity in the Act.
5. Absence of Minimum Rent Provision:
The appellant argued that the absence of a minimum rent provision in the Mysore Act made a material difference. The court noted that the Bombay Act's minimum rent provision was not relied upon in upholding the validity of the Bombay Act. The court concluded that the absence of a minimum rent provision did not affect the validity of the Mysore Act.
6. Consistency Between the General Rule in Section 6(1) and the Exception in Section 6(2):
The appellant argued that the notification issued under Section 6(2) was inconsistent with Section 6(1) and that an exception could not swallow up the general rule. The court examined the decision in "Macbeth v. Ashley [[1874] L.R. 2 Sc. App. 352]" and found that the principle of an exception not swallowing the general rule did not apply to Section 6. The court held that Section 6(1) prescribed a general ceiling for agricultural rent, while Section 6(2) allowed the government to fix a lower rate for specific areas. The court concluded that the notification was consistent with the Act and did not amend Section 6(1).
Conclusion:
The Supreme Court dismissed the appeal, upholding the validity of Section 6(2) of the Mysore Tenancy Act, 1952, and the notification issued under it. The court found that the Act's provisions were intended to achieve social justice and did not infringe upon the appellant's fundamental rights. The court also held that the absence of classification between irrigated and non-irrigated lands and the absence of a minimum rent provision did not affect the validity of the Act. The notification was found to be consistent with the Act's provisions and valid. The appeal was dismissed with costs.
-
1962 (4) TMI 117
Issues:
Claim for double depreciation on studio buildings under rule 8 of the Income-tax Rules.
Analysis:
The judgment revolves around the claim for double depreciation on studio buildings under rule 8 of the Income-tax Rules. The assessee, deriving income from a studio where motion pictures are produced, claimed entitlement to double depreciation for certain buildings considered as factory buildings under the rule. The Income-tax Officer initially rejected the claim, stating that studio buildings cannot be classified as factory buildings. However, the Appellate Assistant Commissioner accepted the claim, leading to an appeal by the department. The Tribunal sought a report from the Income-tax Officer to determine if the buildings qualified as factory buildings. The report confirmed that manufacturing processes were conducted in the building, including editing films, carpentry work, and other factory-related activities. The Tribunal concluded that the building met the definition of a factory for the purpose of double depreciation under rule 8. The department then sought a reference under section 66(1), posing the question of whether the studio buildings qualified for double depreciation as factory buildings under the Income-tax Rules.
The High Court analyzed the facts presented, emphasizing that the key consideration was whether the building fell within the definition of a "factory" building as per rule 8, regardless of the comparative depreciation levels with other factories. The Court noted that the building satisfied the requirements of the Factories Act's definition of a factory. The Court clarified that the entitlement to depreciation under the rule hinged on meeting the definition of a factory building, irrespective of the depreciation levels compared to regular factories. Therefore, the Court upheld the Tribunal's decision, ruling in favor of the assessee and affirming their entitlement to double depreciation on the studio buildings. The department was directed to bear the costs of the assessee.
-
1962 (4) TMI 116
Issues Involved:
1. Legal necessity for the sale of joint family property.
2. Validity of the sale deed executed by a minor.
3. Transfer of cultivating rights in sir lands under the sale deed.
Issue-wise Detailed Analysis:
1. Legal Necessity for the Sale of Joint Family Property:
The appellants contended that there was no legal necessity for executing the sale deed since the family income was sufficient to cover expenses. The trial court found that Rs. 10,000 was required for marriages, Rs. 7,508-8-0 for paying creditors, Rs. 1,655-2-0 for land revenue, and the balance to satisfy a mortgage decree. The appellants' argument that a sum of Rs. 5,000 was not justified was rejected. The court emphasized that it is not necessary to show that every bit of consideration was applied for family necessity. The legal principle established by the Privy Council in cases like Sri Krishan Das v. Nathu Ram and Niamat Rai v. Din Dayal was cited, stating that the alience needs to establish the necessity for the transaction, not the application of every part of the consideration.
2. Validity of the Sale Deed Executed by a Minor:
The trial court found that appellant No. 1 was a minor at the time of the sale deed's execution, making it void concerning his interest. However, the sale was deemed binding on him because his father, Gorelal, the family manager, executed the sale deed. The court held that a manager does not cease to be one merely because a junior member, believed to be a major, also joined the transaction. The transaction's nature and purpose indicated that it was for family necessity, binding on all family members. This principle was supported by decisions in Gharib-Ullah v. Khalak Singh, Kanti Chunder Goswami v. Bisheswar Goswami, and Bijrai Nopani v. Pura Sundary Dasee.
3. Transfer of Cultivating Rights in Sir Lands:
The appellants argued that the sale deed did not explicitly transfer cultivating rights in sir lands, entitling them to retain possession under s. 49(1)(a) of the C. P. Tenancy Act. The court interpreted the sale deed, which mentioned transferring sir and khudkast lands along with "all rights and privileges," as including cultivating rights. The court rejected the narrow interpretation that these words only emphasized the proprietary interest. It concluded that the expression "all rights and privileges" indicated a transfer of all interests, including cultivating rights. The court clarified that the statutory requirement for an express transfer does not necessitate a specific recital of cultivating rights but must be clear from the document's language.
Conclusion:
The appeal was dismissed with costs, affirming the High Court's judgment. The sale was upheld due to established legal necessity, the binding nature of the transaction executed by the family manager, and the comprehensive transfer of rights in the sale deed.
-
1962 (4) TMI 115
Issues:
Appeal against the High Court's judgment quashing the investigation into offences under s. 420, Indian Penal Code, and s. 120B read with s. 420 of the Indian Penal Code.
Analysis:
The case involved an appeal against the High Court's decision to quash an investigation into alleged offences under the Indian Penal Code. The respondent, an Assistant-cum-Executive Engineer, was accused of cheating the Government of West Bengal. The investigation was initiated based on a report filed by a Sub-Inspector of Police Enforcement Branch. The respondent surrendered in court and was released on bail. Subsequently, the respondent filed a petition in the High Court seeking to quash the case. The High Court held that the police investigation was without jurisdiction as the offence fell under the West Bengal Criminal Law Amendment (Special Courts) Act 1949. The High Court's decision was appealed to the Supreme Court.
The Supreme Court, in its judgment, highlighted the statutory power of investigation granted to the police under Chapter XIV of the Code of Criminal Procedure. It emphasized that the police have the right to investigate cognizable offences without the need for authorization from a Magistrate. The Court referenced the case law to support the principle that the functions of the judiciary and the police are complementary but not overlapping. It noted that the court's intervention begins when a charge is preferred before it, and not before. The Court clarified that the inherent powers of the court under s. 561A of the Criminal Procedure Code do not confer new powers but preserve existing ones.
The Supreme Court disagreed with the High Court's decision to interfere with the police's statutory power to investigate the alleged offence. It held that the High Court erred in quashing the investigation and that the police should be allowed to proceed with the investigation in accordance with the law. Therefore, the appeal was allowed, and the order of the High Court was set aside, permitting the investigation to continue.
In conclusion, the Supreme Court's judgment overturned the High Court's decision to quash the investigation, emphasizing the statutory powers of the police to investigate cognizable offences and the complementary roles of the judiciary and the police in the criminal justice system.
-
1962 (4) TMI 114
Issues:
1. Inclusion of dividend income in fresh assessment under Income-tax Act.
2. Limitation period for assessments under section 34(3) of the Income-tax Act.
Issue 1: Inclusion of Dividend Income in Fresh Assessment:
The case involved questions regarding the Income-tax Officer's authority to include dividend income deemed received by the assessee under section 23A orders in a fresh assessment. The Tribunal referred two questions of law, one being whether the Income-tax Officer could include such dividend income in a fresh assessment. The assessee owned shares in a company that declared dividends, and the Income-tax Officer passed section 23A orders deeming the assessee to have received larger dividends. The Appellate Assistant Commissioner set aside the original assessments and remanded for fresh assessment. The Income-tax Officer, in reassessing, included the deemed dividend income, leading to appeals by the assessee. The High Court held that the Income-tax Officer, when reassessing, had the authority to consider section 23A orders and assess the assessee on the larger income, not bound by findings in the original assessment. The Appellate Assistant Commissioner's directions empowered the Income-tax Officer to reassess based on the larger income, even if the original assessment findings differed.
Issue 2: Limitation Period for Assessments:
The second issue revolved around the limitation period for assessments under section 34(3) of the Income-tax Act. Section 34(3) sets a four-year limit for assessments, subject to exceptions. The High Court noted that the reassessments in this case were made after the four-year period from the end of the assessment years. However, the reassessments were done in compliance with the Appellate Assistant Commissioner's orders under section 31, which directed reassessment. The second proviso to section 34(3) exempts reassessments made in pursuance of section 31 orders from the time limit. As all reassessments were made following the Appellate Assistant Commissioner's directions, they were not barred by the time limit. The Court emphasized that since the reassessments were in line with the directions given, they were not subject to the time restriction under section 34(3), ensuring the validity of the reassessment orders.
In conclusion, the High Court upheld the Income-tax Officer's authority to include deemed dividend income in a fresh assessment and ruled that the reassessment orders were valid despite being made after the four-year limitation period due to compliance with the Appellate Assistant Commissioner's directions. The judgment clarified the scope of reassessment powers and the exceptions to the time limit under the Income-tax Act.
-
1962 (4) TMI 113
Issues Involved:
1. Whether the losses incurred at Indore and Bombay could be set off.
2. Whether the Appellate Assistant Commissioner could rectify an error apparent from the record under section 35 of the Indian Income-tax Act, 1922.
3. Whether the Appellate Assistant Commissioner had the power to rectify the order after it had merged in the order passed by the Tribunal.
Issue-wise Detailed Analysis:
1. Set-off of Losses Incurred at Indore and Bombay:
The petitioner argued that the losses incurred at Indore and Bombay should be allowed to be set off. However, the court found this ground untenable. The relevant provisions of section 24(2) of the Indian Income-tax Act, 1922, both before and after its amendment by the Act, 25 of 1953, were examined. The court referred to the Supreme Court's decision in *Anglo-French Textile Co. Ltd. v. Commissioner of Income-tax*, which clarified that a set-off under section 24(1) could only be claimed when the loss arises under one head and the profit against which it is sought to be set off arises under a different head. The amended section 24(2) allowed the whole loss to be carried forward even where the assessee had no other head of income, but this was not in force during the accounting years 1948-49 and 1949-50. Additionally, the court noted the restrictive clause in clause 3 of the Taxation Laws (Part B States) (Removal of Difficulties) Order, 1950, which limited the set-off of losses incurred in Native States. The court concluded that the petitioner could not carry forward the losses incurred in Indore State for set-off against future profits in the taxable territories.
2. Rectification of Error Apparent from the Record:
The petitioner contended that the Appellate Assistant Commissioner could not rectify an error under section 35 of the Act, as the revenue did not appeal against the original order. The court examined the scope of powers under section 35, referencing several Supreme Court cases, including *Venkatachalam v. Bombay Dyeing and Manufacturing Co. Ltd.*, *Maharana Mills (Private) Ltd. v. Income-tax Officer, Porbandar*, and *Income-tax Officer v. Asok Textiles Ltd.*. These cases established that a mistake of law or fact apparent from the record could be rectified under section 35. In this case, the Appellate Assistant Commissioner had allowed the losses sustained in Indore State to be carried forward and set off against income in the taxable territories, disregarding the unamended section 24(2) and clause 3 of the Taxation Laws (Part B States) (Removal of Difficulties) Order, 1950. The court concluded that this was a mistake apparent from the record, which could be corrected under section 35.
3. Power to Rectify After Tribunal's Order:
The petitioner argued that the Appellate Assistant Commissioner had no power to rectify the order after it had merged in the Tribunal's order. The court discussed the principles of merger, citing *Commissioner of Income-tax v. Amritlal Bhogilal & Co.* and other relevant cases. It was established that the jurisdiction of the Tribunal is confined to the subject-matter of the appeal, constituted by the grounds of appeal preferred by the appellant. Since the revenue did not appeal the decision allowing the carry forward and set off of losses, this matter was not the subject-matter of the appeal before the Tribunal. Therefore, the Tribunal's order did not cover this issue, and the Appellate Assistant Commissioner's power to rectify the order remained unaffected.
Conclusion:
The court found all three grounds urged by the petitioner to be untenable. Consequently, the petition was dismissed, and the petitioner was ordered to bear its own costs and pay the respondents' costs out of the security amount, with the remaining security amount to be refunded. The hearing fee was set at Rs. 150.
-
1962 (4) TMI 112
Issues:
Interpretation of section 10(2)(xv) - Whether payment of Rs. 45,000 was a capital expense under the Income Tax Act.
Analysis:
The case involved a dispute regarding the nature of a payment of Rs. 45,000 made by one partner to another in a partnership firm. The payment was made in consideration of assuming control of a canteen business. The Income Tax Officer, Appellate Assistant Commissioner, and Income Tax Appellate Tribunal all held the amount to be a capital expense, not admissible under section 10(2)(xv) of the Act.
The primary contention was whether the payment was made for buying goodwill or to avoid competition. The court analyzed the nature of the business, which operated under military contracts and had monopoly characteristics. The absence of a free market and uncertain profit prospects led the court to conclude that the payment was not for goodwill or competition avoidance.
The court delved into the distinction between capital and revenue expenditure. Capital expenditure involves acquiring assets of lasting value, while revenue expenses are incurred for immediate returns or assets of limited value. The payment of Rs. 45,000 was seen as a non-recurring expenditure to settle a claim to profits, akin to the case law examples cited.
Citing precedents like B.W. Nobel v. Mitchell and In re Ramji Das Jaini & Co, the court emphasized that payments made to acquire rights in a business are capital expenditures. The court also referred to Guruswamy Naidu v. Commissioner of Income-tax and City of London Contract Corporation v. Styles to highlight the treatment of similar expenses as capital outlays.
Drawing parallels with past judgments, the court concluded that the payment of Rs. 45,000 was a capital expense and not admissible as a business deduction. The court answered the question in the affirmative, ruling against the assessee and directing them to pay costs to the department. The decision was based on a thorough analysis of the legal provisions and relevant case law, establishing the nature of the payment as a capital expenditure.
-
1962 (4) TMI 111
Issues:
Interpretation of revenue income from the sale of permits under the Motor Vehicles Act for a transport business.
Analysis:
The case involved determining whether a sum of Rs. 10,000 received by the assessee from the sale of permits granted by the Regional Transport Authority was revenue income liable to tax under the Income-tax Act. The assessee operated a business of plying motor vehicles and was assessed for the relevant year with a credit entry of Rs. 10,000 in its accounts, representing the sale proceeds of permits to third parties. The Income-tax Officer initially treated this amount as revenue income, adding it to the total income for tax assessment. However, the Appellate Assistant Commissioner considered the amount as capital receipt, as the purchasers acquired an enduring benefit of a trading license. The Tribunal overturned the decision, concluding that the sum was revenue receipt. The High Court analyzed the transaction, emphasizing the substance over the form, and determined that the amount was income earned in connection with the business, not a capital receipt.
The court highlighted that the permits were not marketable commodities and could not be legally obtained by anyone without the authority's discretion under the Motor Vehicles Act. The assessee merely transferred the permits to third parties, enabling them to operate vehicles on specified routes, while the assessee refrained from plying vehicles itself. This change in business operation did not increase the assessee's capital but altered the mode of earning profits. Referring to relevant case law, the court distinguished cases involving transfer of legal rights to assets from the present scenario, where the permits were not legal rights owned by the assessee. The court cited Commissioner of Excess Profits Tax v. Shri Lakshmi Silk Mills Ltd. and Raghuvanshi Mills Ltd. to support its conclusion that the sum of Rs. 10,000 was revenue receipt subject to tax assessment.
In conclusion, the High Court answered the question in the affirmative, stating that the sum of Rs. 10,000 was revenue income liable to tax. The court directed the assessee to pay the department's costs and fixed the counsel's fee accordingly. The judgment emphasized the nature of the transaction and the impact on the assessee's business operations, ultimately determining the taxability of the amount received from the sale of permits under the Motor Vehicles Act.
-
1962 (4) TMI 110
Issues Involved:
1. Validity of returns filed beyond the four-year period.
2. Legitimacy of proceedings under Section 34 of the Income-tax Act.
3. Validity of assessments and penalties imposed under Section 46(1) of the Income-tax Act.
4. Applicability of the proviso to Section 45 of the Income-tax Act.
5. Validity of the assessment for the year 1954-55.
Issue-wise Detailed Analysis:
1. Validity of Returns Filed Beyond the Four-Year Period:
The petitioner, a citizen of Ceylon, filed returns for the assessment years 1950-51 and 1951-52 on 12th March 1959, beyond the four-year period from the close of the relevant assessment years. Under Section 34(3) of the Act, no assessment shall be made after the expiry of four years from the end of the year in which the income was first assessable. The court held that a return filed beyond this period is not valid under Section 22(3) of the Act. Therefore, the department was entitled to ignore such returns and take proceedings under Section 34 of the Act.
2. Legitimacy of Proceedings Under Section 34 of the Income-tax Act:
The petitioner argued that the department could not resort to Section 34 proceedings as he had filed voluntary returns. However, the court found that since these returns were filed beyond the four-year period, they were not valid, and the department was justified in resorting to Section 34. The court referenced the Supreme Court decision in Commissioner of Income-tax v. Ranchchoddas Karsondas, which held that a return filed within the four-year period is valid and the department cannot proceed under Section 34 if such a return is before it.
3. Validity of Assessments and Penalties Imposed Under Section 46(1) of the Income-tax Act:
For the years 1956-57 and 1957-58, the assessments were based on returns filed within the four-year period, and no action under Section 34 was taken. The petitioner challenged the penalties imposed under Section 46(1) for non-compliance with the notices of demand. The court upheld the penalties, stating that the assessments were validly made, and the notices of demand were properly issued under Section 29 of the Act. The court found no failure to exercise jurisdiction by the Income-tax Officer in imposing penalties under Section 46(1).
4. Applicability of the Proviso to Section 45 of the Income-tax Act:
The petitioner contended that the income assessed arose outside the taxable territories and that the Income-tax Officer did not apply the relevant proviso of Section 45 before treating him as in default. The court noted that the petitioner had built a cinema theatre costing over a lakh of rupees and had claimed in other proceedings that this amount represented his remittances into the taxable territories. The court held that it was for the petitioner to establish that the capital invested in the cinema was from local borrowings and not remittances. The court found no failure to exercise jurisdiction by the Income-tax Officer in this regard.
5. Validity of the Assessment for the Year 1954-55:
The court found that the return filed by the petitioner on 12th March 1959 for the assessment year 1954-55 was within the four-year period from the end of the assessment year, making it a valid return under Section 22(3) of the Act. As a result, the department was not entitled to resort to Section 34 proceedings for this year. The court quashed the assessment for the year 1954-55 and the consequential order under Section 46(1).
Conclusion:
The court dismissed the writ petitions challenging the assessments and penalties for the years 1950-51, 1951-52, 1952-53, 1953-54, 1956-57, and 1957-58, upholding the department's actions under Section 34 and Section 46(1). However, the court allowed the writ petitions for the year 1954-55, quashing the assessment and the consequential penalty order under Section 46(1). The petitioner was ordered to pay the costs of the department in W.P. No. 977 of 1961, with counsel's fee set at Rs. 250.
-
1962 (4) TMI 109
Issues Involved:
1. Deductibility of contributions to an unrecognized provident fund under Section 10(2)(xv) of the Indian Income-tax Act, 1922.
2. Interpretation of "effective arrangements" under Section 10(4)(c) for tax deduction at source.
3. Applicability of Section 58K regarding capital expenditure.
Issue-wise Detailed Analysis:
1. Deductibility of Contributions to an Unrecognized Provident Fund:
The primary issue was whether the contributions made by the assessee company to the Hindustan Commercial Bank Ltd. Employees' Provident Fund prior to its recognition on June 30, 1946, could be deducted under Section 10(2)(xv) of the Indian Income-tax Act, 1922. The assessee argued that these contributions were an expenditure laid out wholly and exclusively for the purpose of its business. However, the Income-tax Officer disallowed the claim on the grounds that the fund was not recognized under Chapter IXA during the relevant periods. The Appellate Assistant Commissioner upheld this decision, and the Income-tax Appellate Tribunal also rejected the claim, stating that merely appointing trustees did not constitute "effective arrangements" as required by Section 10(4)(c).
2. Interpretation of "Effective Arrangements" under Section 10(4)(c):
The court examined the interpretation of the phrase "effective arrangements to secure the deduction of tax at source" from Section 10(4)(c). The requirements were paraphrased as follows: the assessee should have made an arrangement, the arrangement should secure that tax was deducted at source from the payments made from the fund, and the arrangement should be effective. The Tribunal found that no effective arrangements were made merely by appointing trustees. The court noted that the rules and regulations of the provident fund did not specifically mandate the trustees to deduct tax before making payments. The court concluded that the mere appointment of trustees without specific obligations did not meet the criteria for an effective arrangement.
3. Applicability of Section 58K Regarding Capital Expenditure:
A preliminary objection was raised by the department, arguing that the contributions were in the nature of capital expenditure under Section 58K and thus not deductible under Section 10(2)(xv). Section 58K(1) states that if an employer transfers a provident fund to trustees, the amount transferred is deemed to be capital expenditure. The court rejected this objection, noting that there was no transfer of any fund by the assessee to the trustees. The trustees were appointed on July 28, 1945, and the contributions were made subsequently. There was no evidence of any transfer of an accumulated balance to the trustees. Hence, Section 58K did not apply.
Conclusion:
The court concluded that the assessee did not make effective arrangements to secure the deduction of tax at source as required by Section 10(4)(c). Therefore, the contributions could not be deducted under Section 10(2)(xv). The preliminary objection regarding capital expenditure under Section 58K was also rejected. The reference was answered in the negative, and the assessee was ordered to pay the costs of the reference assessed at Rs. 200.
-
1962 (4) TMI 108
Issues Involved:
1. Legality of the appellant's reversion to the post of Tehsildar.
2. Compliance with Article 311(2) of the Constitution.
3. Probationary status and rights of the appellant under the Punjab Civil Services Rules.
4. Allegations of mala fide action and punishment without due process.
Detailed Analysis:
1. Legality of the appellant's reversion to the post of Tehsildar:
The appellant, initially recruited as Tehsildar in 1936, was promoted to Extra Assistant Commissioner on probation in 1945. His reversion to Tehsildar in 1952 was contested, arguing it was punitive. The Punjab High Court's Division Bench upheld the reversion, stating it was not punitive but due to the appellant's probationary status. The Supreme Court, however, found the reversion to be illegal as it was a punishment disguised as a routine administrative action.
2. Compliance with Article 311(2) of the Constitution:
Article 311(2) provides protection to government servants against dismissal, removal, or reduction in rank without a reasonable opportunity to defend themselves. The appellant argued that his reversion violated this provision. The Supreme Court agreed, noting that the reversion was punitive and the appellant was not given an opportunity to defend himself, thus violating Article 311(2).
3. Probationary status and rights of the appellant under the Punjab Civil Services Rules:
The appellant's probationary status was crucial. Rule 22 of the Punjab Civil Services (Executive Branch) Rules, 1930, stipulates an 18-month probation period, extendable by the Governor. Rule 23 allows reversion if work or conduct is unsatisfactory. The Supreme Court observed that the appellant's probation was not extended, and he continued in service beyond the probation period. The Court clarified that mere continuation beyond the probation period does not confer permanent status unless explicitly provided by the rules. The appellant, thus, remained a probationer but qualified for substantive permanent appointment under Rule 24.
4. Allegations of mala fide action and punishment without due process:
The appellant alleged that his reversion was due to malice from superior officers and not based on his work performance. The Supreme Court examined the sequence of events, including the appellant's exoneration from charges, good reports from superiors, and commendations for his work. The Court concluded that the reversion was not in the ordinary course but intended to punish the appellant for alleged misconduct. The lack of stated reasons for reversion and subsequent warning from the government indicated a mala fide action. The Court held that the reversion was punitive and conducted without following due process, rendering it illegal.
Conclusion:
The Supreme Court allowed the appeal, quashed the reversion order dated May 28, 1952, and directed the government to pay costs. The judgment emphasized the need for compliance with Article 311(2) and highlighted the protection of probationers from punitive actions disguised as administrative decisions.
-
1962 (4) TMI 107
Issues Involved:
1. Whether the sums of Rs. 15,200, Rs. 16,050, Rs. 16,650, Rs. 17,250, and Rs. 17,850 were allowable deductions against the income of the assessee for the respective assessment years 1948-49 to 1952-53.
2. Whether the Ceylon profits tax amounting to Rs. 11,909 for the assessment year 1951-52 and Rs. 53,348 for the assessment year 1952-53 was an allowable deduction in the computation of the total income of the assessee.
Issue-wise Detailed Analysis:
1. Allowable Deductions Against Income for Assessment Years 1948-49 to 1952-53:
The assessee, Indian Overseas Bank Ltd., Madras, secured the services of an officer from the Imperial Bank of India, Arumugham Subbiah, by agreeing to pay him Rs. 1,00,000 upon joining its service, in addition to a monthly salary. This sum was to become Subbiah's absolute property under certain conditions, such as completing seven years of service or becoming incapacitated. During the assessment years 1948-49 to 1952-53, the assessee claimed sums of Rs. 15,200, Rs. 16,050, Rs. 16,650, Rs. 17,250, and Rs. 17,850 as deductible allowances, arguing these were necessary business expenditures.
The Income-tax Officer disallowed the claim, viewing the Rs. 1,00,000 payment as a capital expenditure. The Appellate Assistant Commissioner upheld this view, stating the amount was akin to a purchase price for Subbiah's services and thus a capital expenditure. However, the Appellate Tribunal disagreed, considering the amount as an advance salary, recoverable with interest, and thus deductible as yearly expenditure.
Upon review, the court examined the agreement's clauses. It concluded that the Rs. 1,00,000 was an outright payment upon Subbiah taking up service, not a recurring expenditure. The bank's right to recover any amount was contingent on Subbiah's death or resignation, not a present right. Therefore, the court determined that no expenditure was incurred during the years in question, as the payment was made in 1945. Consequently, the sums claimed could not be allowed as deductions.
2. Allowable Deduction for Ceylon Profits Tax:
The assessee also claimed deductions for profit taxes paid in Ceylon under the Ceylon Profits Tax Act, amounting to Rs. 11,909 for 1951-52 and Rs. 53,348 for 1952-53. The Appellate Assistant Commissioner rejected this claim, noting that business profits tax is not deductible under section 10 of the Indian Income-tax Act. The Tribunal, however, allowed the claim, interpreting section 10(4) as applicable only to taxes levied in India.
The court found no authority supporting the assessee's contention that foreign taxes should be deductible under Indian law. Section 10(4) explicitly prohibits deductions for any tax levied on business profits, regardless of whether the tax is imposed in India or abroad. The court referenced Kanga's commentary and the case of Commissioners of Inland Revenue v. Dowdall O'Mahoney and Company Limited, which held that foreign taxes are not deductible as business expenses.
The court concluded that the Tribunal's view was legally unsound and ruled in favor of the department, disallowing the claimed deductions for Ceylon profits tax.
Conclusion:
The court ruled in favor of the department on both issues. The sums claimed as deductible allowances for the years 1948-49 to 1952-53 were not allowable, as the expenditure was deemed to have been incurred in 1945. Additionally, the Ceylon profits tax paid by the assessee was not deductible under Indian income-tax law. The assessee was ordered to pay the department's costs, with a counsel's fee of Rs. 250.
............
|
9911796707
