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Case Laws
Showing 421 to 440 of 835 Records
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1969 (7) TMI 9
The High Court of Orissa held that revocable leasehold salt lands are not assessable to wealth-tax. The Tribunal's decision was deemed incorrect. The judgment was made in reference to the case of Commissioner of Wealth-tax v. Srimathi Martinammal Machado. The question posed was answered in favor of the assessee. The reference was disposed of with no order as to costs.
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1969 (7) TMI 8
Whether the assessee-company was a company in which the public are substantially interested and was consequently outside the operation of s. 23A(1) by reason of third proviso thereto - since shares carrying more than 25 % of the voting power are held by the public and its shares are also, freely transferable by the holders thereof to the other members of the public, it must be held that the assessee-company is a company in which the public are substantially interested
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1969 (7) TMI 7
Whether, in the facts and circumstances of the case, the life insurance premia and interest thereon paid by cheque on the assessee's overdraft account with the State Bank of India was allowable as a debt under section 2(m) of the Wealth-tax Act - Held, no
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1969 (7) TMI 6
Application for Reference - Procedure - Whether the conclusion of the Tribunal that the expenditure was wholly and exclusively incurred for the purpose of maintaining the goodwill and reputation of the assessee-company was based on no evidence or was perverse in the accepted sense of the term - case remanded
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1969 (7) TMI 5
Issues:
1. Jurisdiction of High Court under article 226 of the Constitution versus alternative remedy of appeal under section 33B of the Income-tax Act.
2. Adequacy of opportunity given to the appellant before the order under section 33B of the Act was made.
3. Validity of service of notice under section 33B and applicability of civil procedure rules.
Analysis:
The judgment revolves around the appellant's appeal regarding the cancellation of assessment orders under the Income-tax Act, 1922. The primary issue raised is whether the appellant was entitled to invoke the special jurisdiction of the High Court under article 226 of the Constitution or if an appeal under section 33B of the Act would have been more appropriate. The court emphasized that when an alternative and equally efficacious remedy is available, the litigant should pursue that remedy rather than seek a writ. The court cited previous cases to highlight that the High Court's extraordinary jurisdiction should be reserved for cases involving fundamental rights or jurisdictional errors by taxing authorities.
Regarding the adequacy of the opportunity given to the appellant, the court found that the appellant had been provided with a chance to be heard before the order under section 33B was made. The appellant's claim of not being aware of the notice was contradicted by evidence showing that notices were sent to her address and attempts were made for personal service. The High Court concluded that the appellant had refused to accept the notice, indicating that she was aware of the proceedings, thus fulfilling the requirement of providing an opportunity to be heard.
The judgment also delved into the validity of the service of notice under section 33B and the applicability of civil procedure rules. While the appellant argued that the service of notice by affixing did not strictly adhere to civil procedure rules, the court clarified that section 33B did not explicitly require such strict notice procedures as in other sections of the Act. The High Court's examination of the evidence led to the conclusion that the appellant had indeed been given an opportunity to be heard before the order was issued, thereby upholding the validity of the service of notice under section 33B.
In conclusion, the court dismissed the appeal, affirming that the appellant was not entitled to any relief. The judgment highlighted the importance of exhausting alternative remedies before seeking extraordinary jurisdiction and emphasized the necessity of providing adequate opportunities for the parties involved in tax assessment proceedings.
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1969 (7) TMI 4
Assessment made on the assessee in the status of a HUF in respect of income received by him as receiver could be justified notwithstanding the provisions of s. 41 - once valid proceedings are stated u/s. 34(1)(b) the ITO had not only the jurisdiction but it was his duty to levy tax on the entire income that had escaped assessment during that year - hence assessment made u/s. 34 is valid in law - assessee is not entitled to set off sum paid to the minors
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1969 (7) TMI 3
Whether the surplus realised by the sale of the shares of Aluminium Corporation of India Ltd., J. K. Investment Trust and Raymond Woollen Mills amounting in the aggregate to Rs. 3,99,587 or any part thereof was the revenue income of the assessee liable to tax under the Income-tax Act, 1922 - Held, Yes - Assessee's appeal dismissed
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1969 (7) TMI 2
Capital gains - proportionate share of the capital gains out of which the dividend was distributed to the shareholders of the company must be deemed exempt from liability to pay tax under s. 12 as dividend income liable to tax - Revenue's appeal dismissed
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1969 (7) TMI 1
Whether the search was mala fide - In the absence of anything to show that the documents seized were either replaced or tampered with, the irregularity of failing to place identification marks on several documents will not by itself supply a ground for holding that the search was mala fide - Revenue's appeal allowed by way of remand
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1969 (6) TMI 44
Issues Involved:
1. Whether the offence of adulteration under Section 2(i)(j) of the Prevention of Food Adulteration Act was proved.
2. Whether the offence falls under Section 2(i)(1) of the Prevention of Food Adulteration Act.
3. Whether the case is fit for action under Section 4 of the Probation of Offenders Act.
Issue-wise Detailed Analysis:
Issue 1: Offence of Adulteration under Section 2(i)(j) of the Prevention of Food Adulteration Act
The Food Inspector filed a complaint alleging that the accused sold Mysorepak containing metanil yellow coaltar-dye, which is prohibited under the Prevention of Food Adulteration Act and Rules. The trial court found the Mysorepak adulterated and convicted the accused under Section 16(1)(a)(i) read with Sections 7 and 2(i)(j) of the Act. The Sessions Judge confirmed this conviction and sentence.
The relevant portion of Section 2(i)(j) states that an article of food is deemed adulterated if it contains any non-prescribed coloring matter or if the quantity of its constituents exceeds prescribed limits. The rules under the Act specifically prohibit the addition of unauthorized coloring matter, including inorganic pigments and non-permitted coaltar dyes. Metanil yellow is not listed as a permitted coaltar dye under Rule 28, thus its use is prohibited.
The court interpreted the word "and" in Section 2(i)(j) as "or" to avoid absurdity, as a literal conjunctive reading would imply that a totally prohibited coloring matter could be used within prescribed limits, which is illogical. The court relied on precedents where "and" was interpreted as "or" to give effect to the legislative intent and avoid absurd results. Therefore, the court upheld the finding that the accused's use of metanil yellow constituted an offence under Section 2(i)(j).
Issue 2: Applicability of Section 2(i)(1) of the Prevention of Food Adulteration Act
The accused contended that the case should fall under Section 2(i)(1), which deals with the quality or purity of the article falling below the prescribed standard. However, the court found that since the Mysorepak contained a prohibited coloring matter, it was specifically covered under Section 2(i)(j) rather than Section 2(i)(1). The court concluded that Section 2(i)(j) was the more appropriate provision and upheld the conviction under this section.
Issue 3: Action under Section 4 of the Probation of Offenders Act
The accused, an elderly man and a petty shopkeeper, argued for leniency under Section 4 of the Probation of Offenders Act. The minimum sentence prescribed under the Act was six months' imprisonment and a fine, which the Sessions Judge felt compelled to impose despite acknowledging the harshness of the sentence given the accused's circumstances.
Considering the special circumstances, including the accused's age and the nature of the offence, the court deemed it fit to apply Section 4(1) of the Probation of Offenders Act. The court set aside the conviction and sentence, directing the accused to be released on probation for one year, during which he must maintain good behavior. The court also ordered the refund of any fine paid.
Conclusion
The court upheld the conviction under Section 2(i)(j) of the Prevention of Food Adulteration Act, rejected the applicability of Section 2(i)(1), and granted probation under Section 4 of the Probation of Offenders Act, considering the accused's age and circumstances.
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1969 (6) TMI 43
Issues Involved:
1. Non-compliance with Order 5, Rule 19, Civil Procedure Code (CPC) regarding the service of summons.
2. Validity of execution sale conducted without proper notice.
3. Application of Article 166 of the Limitation Act, 1908.
4. Requirement of an express declaration by the court regarding due service of summons.
Detailed Analysis:
1. Non-compliance with Order 5, Rule 19, Civil Procedure Code (CPC) regarding the service of summons:
The Full Bench was constituted to resolve conflicting observations in previous decisions regarding the effect of non-compliance with Order 5, Rule 19 CPC, which mandates the procedure for service of summons. Specifically, the judgment-debtor contended that the service of summons was not properly executed as required by Order 5, Rule 19. The court noted that the process server did not verify the return by an affidavit, and the court did not examine the process server on oath or declare that the summons had been duly served. The absence of these steps rendered the service invalid.
2. Validity of execution sale conducted without proper notice:
The judgment-debtor argued that he had no notice of the sale, rendering it void. He claimed that the property was undervalued and sold fraudulently, causing substantial injury. The court found that the sale was conducted without proper notice, as the service of summons was not compliant with Order 5, Rule 19 CPC. The court emphasized that strict compliance with the provisions of Order 5, Rule 19 is essential to ensure that the judgment-debtor has actual or constructive notice of the sale.
3. Application of Article 166 of the Limitation Act, 1908:
The judgment-debtor contended that the limitation period under Article 166 should start from the date of his knowledge of the sale, not the date of the sale itself. The court rejected this argument, holding that Article 166 prescribes a period of thirty days from the date of the sale, assuming the judgment-debtor had notice of the sale. If the judgment-debtor did not have notice, Article 166 would not apply, and the residuary Article 181 would provide a three-year limitation period. The court concluded that strict compliance with Order 5, Rule 19 is necessary before applying the shorter limitation period under Article 166.
4. Requirement of an express declaration by the court regarding due service of summons:
The court held that an express declaration by the court that the summons had been duly served is mandatory under Order 5, Rule 19 CPC. This declaration can be in any convenient form, such as "defendant duly served" or "service sufficient." The court's endorsement must indicate that the presiding officer has applied his mind and considers the summons duly served. The absence of such a declaration would render the service ineffective and invalidate subsequent proceedings, including the execution sale.
Conclusion:
The Full Bench concluded that non-compliance with Order 5, Rule 19 CPC regarding the service of summons renders the service ineffective. Consequently, the execution sale conducted without proper notice was declared void. The court emphasized the necessity of strict compliance with the provisions of Order 5, Rule 19, including the requirement of an express declaration by the court that the summons had been duly served. The judgment-debtor's appeal was allowed, and the execution sale was set aside.
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1969 (6) TMI 42
Issues Involved:
1. Jurisdiction of the Trial Court.
2. Validity of the Certificate issued under Section 3(2) of the Revenue Recovery Act.
3. Validity of the Proclamation issued by the Mamlatdar.
4. Whether the plaintiff was a defaulter under the Revenue Recovery Act.
5. Requirement of an inquiry before issuing the certificate.
6. Applicability of Section 4 of the Revenue Recovery Act regarding deposit of the amount claimed.
Detailed Analysis:
1. Jurisdiction of the Trial Court:
The primary argument raised by Mr. Tambe for the appellant was that the learned Joint Judge erred in holding that the Trial Court had no jurisdiction to try the suit and returning the plaint for presentation to the proper Court. It was pointed out that the District Court had previously reversed the Trial Court's finding, holding that the Court of the Civil Judge, Senior Division, Ahmednagar, had jurisdiction. This finding was conclusive and could not be reopened. The appellate court cannot entertain jurisdictional issues unless prejudice is shown to have been caused by the suit being instituted in an inappropriate forum. The subject matter of the suit involved actions taken by the Mamlatdar in the district, thus conferring jurisdiction on the Trial Court.
2. Validity of the Certificate issued under Section 3(2) of the Revenue Recovery Act:
Mr. Tambe contended that the certificate (Ex. 31) was invalid as it was issued by an authority not entitled under Section 3(1) of the Revenue Recovery Act. However, the plaintiff did not amend his pleadings to challenge the certificate on this ground. The Union of India may have had several answers if this point had been raised at trial. The certificate, issued by the Collector of Osmanabad, was presumed valid, and the plaintiff was not allowed to traverse beyond his original pleadings to challenge its legality at this stage.
3. Validity of the Proclamation issued by the Mamlatdar:
The proclamation issued by the Mamlatdar was challenged on the grounds that it was illegal and void under Section 6 of the Revenue Recovery Act. However, Section 6 pertains to attachment, while the proclamation in question was for the sale of property. The procedure under the Land Revenue Code for attachment and sale of property applied, and the Mamlatdar had the authority to issue the proclamation under administrative orders. The appellate court found the proclamation valid, and the trial court's decision was based on the incorrect assumption that the certificate was invalid due to lack of inquiry.
4. Whether the plaintiff was a defaulter under the Revenue Recovery Act:
The appellant argued that he was not a "defaulter" as defined by Section 2(3) of the Revenue Recovery Act. However, the Union of India produced a bond executed by the appellant, which referred to Rule 103 of the Posts and Telegraphs Manual and the Public Accountants' Default Act, 1850. The bond obligated the appellant to pay for any loss caused to the Union due to his conduct. Thus, the appellant was considered a defaulter, as the loss was recoverable as an arrear of land revenue.
5. Requirement of an inquiry before issuing the certificate:
The appellant argued that the certificate was invalid as no inquiry was held before its issuance, violating natural justice. However, Section 5 of the Revenue Recovery Act does not mandate an inquiry before issuing a certificate. The defaulting officer can challenge the amount through a suit, provided the amount is deposited. The appellant had opportunities to contest the claim but failed to utilize them, leading to the conclusion that the certificate was valid.
6. Applicability of Section 4 of the Revenue Recovery Act regarding deposit of the amount claimed:
The appellate court held that the suit could not be maintained without depositing the amount claimed. Although Section 4 of the Revenue Recovery Act might not apply if the challenge is solely to the proclamation's legality, the merits of the case were decided against the plaintiff, rendering this point moot.
Conclusion:
The appeal was dismissed, and the plaintiff's suit was rejected with costs throughout. The interim injunction was vacated, and the appellant was ordered to pay the costs of the application to the Union.
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1969 (6) TMI 41
Issues:
1. Validity of the "test-check-cum-muster roll method" for best judgment assessment.
2. Applicability of government instructions on assessment methods.
3. Justifiability of best judgment assessment without finding fault with the return.
Analysis:
1. The judgment addressed the validity of the "test-check-cum-muster roll method" used by the assessing authority for best judgment assessment. The assessee contested the method, arguing that it was not reliable due to various factors affecting the mill's capacity and worker efficiency. The appellate authority and the Appellate Tribunal upheld the method, stating it was permissible by law and essential for determining turnover accurately. However, the High Court found the method to be flawed as it could lead to undue hardship for the assessee. The court emphasized that the assessing authority should adopt a method minimizing errors to a negligible extent. Consequently, the court set aside the assessment and directed a fresh assessment with a more reliable method to reduce errors significantly.
2. The judgment also discussed the applicability of government instructions on assessment methods, particularly the instructions issued by the Board of Revenue to curb tax evasion in paddy and rice trade. The government had decided to waive excess tax levied based on certain methods for specific years to avoid hardship for millers. The court noted that the assessing authority followed these instructions, which were later revised for more effective measures. The court highlighted that the method used in the present case was not consistent with the revised approach, indicating a lack of reliability and potential hardship for the assessee.
3. Additionally, the judgment examined the justifiability of resorting to best judgment assessment without finding fault with the return filed by the assessee. The assessing authority justified the best judgment assessment based on the suppression of certain bags of paddy, which raised doubts about the accuracy of the return. The court agreed that such circumstances warranted a best judgment assessment. However, it emphasized that the method chosen should not cause undue harm or hardship to the assessee. Given the flaws in the method used and the potential for prejudice, the court set aside the assessment and instructed a fresh assessment with a more reliable approach, leaving the method selection to the assessing authority's discretion.
In conclusion, the High Court's judgment focused on the inadequacies of the "test-check-cum-muster roll method" for best judgment assessment, the importance of using reliable assessment methods to minimize errors and avoid undue hardship for the assessee, and the need for assessing authorities to follow updated and effective government instructions to ensure fair and accurate assessments.
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1969 (6) TMI 40
Issues Involved:
1. Competence of the Deputy Commercial Tax Officer to levy penalty.
2. Timing of the initiation of penalty proceedings.
3. Authority of the successor-assessing authority to initiate penalty proceedings.
Issue-wise Detailed Analysis:
1. Competence of the Deputy Commercial Tax Officer to levy penalty:
The primary issue was whether the Deputy Commercial Tax Officer was competent to levy a penalty when the original assessment was made by the Commercial Tax Officer. The court noted that the Deputy Commercial Tax Officer, as defined in the Act, was an "assessing authority" authorized and empowered to make assessments by the State Government. The court concluded that the Deputy Commercial Tax Officer was competent to levy the penalty since the matter was within his jurisdiction both on pecuniary and territorial bases. The court emphasized that the legality of the levy could not be assailed on the ground that the Deputy Commercial Tax Officer was not the same authority that made the original assessment.
2. Timing of the initiation of penalty proceedings:
The court addressed whether the penalty proceedings must be initiated simultaneously with or in continuation of the original assessment order. The court referred to Section 14(2) of the Act, which provides the assessing authority the power to levy a penalty in addition to the tax assessed. The court held that Section 14(2) is an enabling provision that does not specify a time limit for initiating penalty proceedings. It was observed that the initiation of penalty proceedings need not be simultaneous with the original assessment. The court cited previous judgments to support the view that the levy of penalty does not automatically follow upon assessment and that a reasonable opportunity must be given to the dealer to explain the omission. The court concluded that the initiation of penalty proceedings after the appellate order was valid.
3. Authority of the successor-assessing authority to initiate penalty proceedings:
The court examined whether the successor-assessing authority, in this case, the Deputy Commercial Tax Officer, was authorized to initiate penalty proceedings. It was noted that the term "assessing authority" in Section 14(2) does not imply the same person who made the original assessment. The court held that if the jurisdiction is conferred on another authority due to transfer or other reasons, such authority is competent to take up the case from that stage to its final stage. The court rejected the argument that the person who imposes the penalty should be the same as the person who made the assessment order. The court concluded that the Deputy Commercial Tax Officer, who revised the assessment order, was competent to initiate penalty proceedings.
Conclusion:
The court set aside the order of the Tribunal, holding that the Deputy Commercial Tax Officer was competent to initiate penalty proceedings even though he was not the original assessing authority. The petition was allowed with no order as to costs, and an advocate's fee of Rs. 100 was awarded.
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1969 (6) TMI 39
The court held that the sale of jaggery attracts tax under the Madras Agricultural Produce Markets Act, and the tax under the Madras General Sales Tax Act can also be levied. Jaggery is not considered an agricultural produce under the Madras General Sales Tax Act. The petition was dismissed.
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1969 (6) TMI 38
Issues:
Interpretation of the term "sugar" under the Andhra Pradesh General Sales Tax Act in relation to sugar candy for tax liability determination.
Detailed Analysis:
The judgment of the Andhra Pradesh High Court involved a dispute regarding the interpretation of the term "sugar" under the Andhra Pradesh General Sales Tax Act in relation to sugar candy for tax liability determination. The Sales Tax Appellate Tribunal initially found that sugar candy and bura sugar sold by the assessees were subject to a levy under the Additional Duties of Excise Act and could not be taxed under the Andhra Pradesh General Sales Tax Act. However, the Tribunal remanded the case for further determination on whether the commodities were actually subjected to a levy of additional duties of excise. This decision was challenged by the assessee in T.R.C. No. 14 of 1965, arguing that once the commodities were considered to be included in the term "sugar" exempt from tax under the Act, the order of remand was unwarranted.
In two other appeals before the Tribunal, it was held that "sugar candy" was not included in the term "sugar" for tax exemption purposes, leading to a direction for a 1% tax levy. This decision was challenged in T.R.Cs. Nos. 2 and 3 of 1966. The main issue for determination was whether the term "sugar" under the Act included "sugar candy," which is a purer form of sugar. The historical background and legislative context of the Act were considered to understand the legislative intent behind the term "sugar."
The Court analyzed the legislative history, including the Second Finance Commission's recommendations and subsequent amendments to the Act exempting certain goods from tax under the Andhra Pradesh General Sales Tax Act. The Court observed that the term "sugar" was removed from taxable items and added to the exempted list, indicating that sugar, on which additional excise duty could be levied, was exempt from sales tax. The Court also referred to decisions from other High Courts, such as the Mysore High Court and the Madras High Court, which supported the interpretation that "sugar candy" should be considered exempt under the Act.
The Court further reasoned that "sugar candy" should be regarded as purified sugar itself, as it contains no other ingredient but sugar. The argument that the Legislature should have used clearer terms if all forms of sugar were intended to be included was dismissed, considering the historical context and the legislative framework. Ultimately, the Court held that the expression "sugar" in Schedule V included "sugar candy," exempting it from tax liability. Consequently, the orders of the Appellate Tribunal were set aside, and the assessee was deemed not liable for any tax related to sugar candy. The Court allowed the appeals and awarded costs to the petitioner-company.
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1969 (6) TMI 37
Issues Involved
1. Whether the sales tax provision of Rs. 22,642 is deductible in the computation of the total income of the assessee for the assessment year 1961-62.
Detailed Analysis
Issue 1: Deductibility of Sales Tax Provision
Facts and Background:
- The assessee followed the mercantile system of accounting.
- For the assessment year 1961-62, the assessee made a provision of Rs. 22,642 for sales tax payable.
- The Income-tax Officer disallowed the deduction, considering it a mere provision for taxes that were neither paid nor ascertained by the sales tax authorities.
- The Appellate Assistant Commissioner upheld this disallowance.
- The Income-tax Appellate Tribunal allowed the deduction, stating that the sales tax liability accrued as soon as the sales were effected.
Arguments by Revenue:
- Sales tax is not deductible for income-tax purposes.
- The liability for sales tax arises only upon assessment or demand by sales tax authorities.
- Reliance was placed on various cases, including *Recols (India) Ltd.*, *Kedarnath Jute Manufacturing Co.*, and others, arguing that mere legal liability is insufficient for claiming deduction.
Arguments by Assessee:
- Sales tax is deductible under sections 10(1) and 10(2)(xv) of the Indian Income-tax Act, 1922.
- Payment of sales tax is necessary for carrying on the business.
- The liability for sales tax arises on sales effected, not on assessment or demand.
- Cited cases including *Kesoram Industries and Cotton Mills Ltd.* and *Textile Machinery Corporation Ltd.* to support the claim.
Court's Analysis:
- Reviewed the relevant provisions of the Bengal Finance (Sales Tax) Act, 1941.
- Noted that the liability to pay sales tax arises on sales effected, not dependent on assessment or demand.
- The obligation to pay sales tax is directly related to the business and is necessary for its operation.
- Sales tax is a compulsory levy and its payment is necessary for carrying on the business.
- In the context of the mercantile system of accounting, expenditures are entered when a legal liability arises, not when the actual payment is made.
Precedents Considered:
- *Keshav Mills Ltd.* and *Calcutta Company Ltd.*: Mercantile system of accounting recognizes liabilities when they arise.
- *Kesoram Industries and Cotton Mills Ltd.*: Liability to pay tax is a present liability.
- *Textile Machinery Corporation Ltd.*: Provision for sales tax stands on the same footing as provision for income-tax liability.
Conclusion:
- The assessee is entitled to deduction of the sales tax provision under section 10(2)(xv) of the Indian Income-tax Act, 1922.
- The liability for sales tax is incurred in the capacity of a trader and is directly connected with the business.
- The facts of the case differ from *Kedarnath Jute Manufacturing Co.*, where the liability was disputed and no provision was made.
- The court answered the reference in the affirmative, in favor of the assessee, allowing the deduction of the sales tax provision.
Judgment:
- The reference was answered in the affirmative, and the Commissioner of Income-tax was directed to pay the costs of the reference.
Separate Judgment:
- SANKAR PRASAD MITRA, J. concurred with the judgment.
Final Reference:
- Reference answered in the affirmative.
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1969 (6) TMI 36
Issues:
Interpretation of section 18-A of the Mysore Sales Tax Act, 1957; Levying penalties under section 18-A; Constitutional validity of section 18-A.
Analysis:
The judgment by the High Court of Mysore dealt with writ petitions challenging penalties imposed under section 18-A of the Mysore Sales Tax Act, 1957. The main contention of the petitioners was that they did not contravene the provisions of section 18 and, therefore, penalties should not be levied. The Commercial Tax Officer had imposed penalties based on the excess amounts collected by the petitioners compared to the total tax assessed on their turnovers. The petitioners argued that they collected tax at specified rates and explained the possibility of variations in tax collection due to high turnovers.
The Court noted that the Commercial Tax Officer did not satisfactorily address the petitioners' main contention that they collected tax only at specified rates. The Officer imposed penalties based on the excess amounts collected, without proving that the petitioners collected tax at rates exceeding those specified under the Act. The Court clarified that a dealer can collect small amounts in excess of the total tax assessed without contravening section 18(1) of the Act. The judgment emphasized that penalties under section 18-A are attracted only when a dealer collects amounts not in accordance with prescribed conditions or at rates exceeding those specified.
The Court found a clear error of law in the impugned orders and quashed them. It directed the Commercial Tax Officer to reconsider the case, giving the petitioners a fair opportunity to present their explanations. The judgment highlighted that penalties under section 18-A are not applicable if section 18(1) is not contravened, even if the aggregate amounts collected exceed the tax chargeable on the total turnover. The Court did not address other grounds raised in the writ petitions, and the petitions were allowed without costs.
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1969 (6) TMI 35
Issues:
1. Whether ginger is considered a vegetable for the purpose of taxation under the Orissa Sales Tax Act.
Analysis:
The High Court of Orissa was presented with the issue of determining whether ginger should be classified as a vegetable for taxation purposes under the Orissa Sales Tax Act. The Sales Tax Tribunal referred the question to the High Court, seeking clarification on whether ginger falls under the definition of vegetables, which are not taxable under the Act. The Tribunal's decision was based on the test laid down in a previous case, Dhadi Sahu v. Commissioner of Sales Tax, Orissa I.L.R. 1961 Cutt. 175, which defined vegetables as plants primarily grown for food purposes. The Division Bench emphasized that vegetables are plants cultivated in kitchen gardens for consumption as food. The Court noted that ginger in Orissa is not primarily used as a food item but rather for enhancing the taste of main dishes, whether vegetarian or non-vegetarian.
The Court acknowledged that the definition of vegetables for taxation purposes differs from the common understanding of the term. It cited the Supreme Court's interpretation in Ramavatar v. Assistant Sales Tax Officer, Akola, and Another A.I.R. 1961 S.C. 1325, where vegetables were defined as plants grown in a kitchen garden or farm for table use. The Supreme Court's test did not require the vegetable to be the primary food item but rather suitable for table consumption. The Court distinguished between items like sugarcane and betel leaves, which, although grown in gardens, are not typically consumed directly as food. The judgment highlighted that certain items like mint or coriander, used for flavoring, are still considered vegetables if grown in a kitchen garden and used for the table.
The Court analyzed the Division Bench's decision in light of the Supreme Court's consistent interpretation of the term "vegetable." It clarified that the Division Bench's reliance on a particular passage led to an incorrect conclusion regarding the primary purpose of food consumption. The Court emphasized that the Orissa decision remains valid in determining vegetables based on local perceptions. The judgment referenced cases from Kerala and West Bengal supporting the classification of ginger as a vegetable. Ultimately, the Court held that ginger should be considered a vegetable for taxation purposes, overturning the Tribunal's decision. The parties were directed to bear their own costs, with the petitioner entitled to a refund of the deposited tax amount under the Orissa Sales Tax Act.
In conclusion, the High Court of Orissa clarified the classification of ginger as a vegetable for taxation under the Orissa Sales Tax Act based on the interpretation of the term "vegetable" as per legal precedents and local perceptions.
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1969 (6) TMI 34
The High Court of Andhra Pradesh dismissed the tax revision petition challenging the Sales Tax Appellate Tribunal's order. The petitioners, a Hindu joint family firm, were not entitled to exemption on the purchase and sale of oil products as they did not exclusively deal in oil produced from hand presses as required by the notification. The court held that dealing exclusively in oil from the presses was a necessary condition for exemption. The petition was dismissed, and no costs were awarded.
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9911796707
