Issues:
1. Whether an option given to a lessee to renew a lease every 10 years is void under the rule of perpetuity.

Analysis:
The judgment in question pertains to an appeal from the Mysore High Court regarding the validity of an option given to a lessee for lease renewal every 10 years. The lease agreement allowed the lessee to renew the lease for further periods of 10 years on the same terms and conditions. The lessor failed to comply with the lessee's request for renewal, leading to a lawsuit for specific performance. The central issue revolved around whether the option for renewal violated the rule against perpetuity as per Section 14 of the Transfer of Property Act.

The rule against perpetuity, as enshrined in Section 14 of the Act, prohibits the creation of interests that extend beyond the lifetime of individuals living at the time of transfer. The court highlighted that a lease is a transfer of a right in property, creating a leasehold interest that may extend in perpetuity, with the lessor retaining a reversionary interest. In this case, the lease was initially for 10 years, with clauses allowing for renewal at the lessee's discretion. The court emphasized that the renewal clauses did not constitute a transfer of property or any rights therein, as the lease was limited to 10 years initially.

Drawing from legal precedents, the court distinguished the present case from English law examples where covenants for perpetual renewal were upheld. The judgment referenced a Patna High Court decision that clarified how options for a lessor to resume leasehold land were personal covenants, not creating interests in land subject to the rule against perpetuity. Additionally, the court cited English cases where covenants for renewal were deemed to run with the land, exempting them from perpetuity concerns.

Moreover, the judgment delved into Section 40 of the Act, which addresses the enforcement of covenants for the beneficial enjoyment of immovable property. The court explained that even if the clauses for lease renewal were considered covenants running with the land, they did not create interests in property that would trigger Section 14's perpetuity restrictions. Ultimately, the court dismissed the appeal, asserting that the clauses for lease renewal did not violate the rule against perpetuity, as no interest in property of the nature contemplated by the provision had been created.

In conclusion, the judgment elucidates the application of the rule against perpetuity to lease renewal options and clarifies that such clauses, when not creating interests in property beyond the permissible limits, do not contravene the statutory provisions.

Issues:
1. Validity of the notification withdrawing import duty concession.
2. Determination of the date of entry inwards for calculating duty payable.
3. Interpretation of relevant provisions of the Customs Act, 1962.

Analysis:
1. The petitioner imported aluminum rods with duty concessions, later withdrawn by a notification. The petitioner challenged the withdrawal as ultra vires, seeking a writ of certiorari to quash the notification and refund excess duty. The court noted the notification's validity from the date of publication and upheld duty collection for consignments filed after its enforcement. However, for consignments filed earlier, the court examined the ship's arrival date to determine duty calculation.

2. The crucial issue was the date of the ship's entry inwards for duty calculation. Conflicting evidence on the ship's arrival date was presented. The court analyzed the relevant provisions of the Customs Act, focusing on Section 15, which determines duty calculation based on the bill of entry presentation date and the ship's entry inwards date. The court emphasized the importance of the entry inwards date for tariff valuation and duty payment, ultimately concluding that the ship's actual berthing date should be considered the entry inwards date.

3. The court further delved into Sections 15 and 16 of the Customs Act, drawing parallels between import and export duty calculation procedures. The court highlighted the significance of the entry inwards date for unloading imported goods, as per Sections 30 and 31 of the Act. By referencing historical provisions of the Sea Customs Act 1878, the court reinforced its interpretation that the entry inwards date corresponds to the ship's berthing date, dismissing the writ petition as lacking merit based on the established duty calculation principles within the Customs Act.

Issues:
1. Imposition of penalty for delay in filing income tax return under section 271(1)(i) of the Income-tax Act, 1961.
2. Interpretation of penalty provisions under section 271(1)(i) regarding minimum and maximum limits.
3. Consideration of advance tax paid by the assessee while calculating the penalty amount.

Analysis:
The High Court of Rajasthan addressed a reference by the Income-tax Appellate Tribunal regarding the imposition of a penalty on an assessee for delay in filing income tax returns under section 271(1)(i) of the Income-tax Act, 1961. The Tribunal had reduced the penalty from Rs. 4,380 to Rs. 200, citing the absence of a minimum penalty limit under the new Act compared to the old Act. The Court disagreed with this view, emphasizing that the penalty calculation should align with the provisions of the current Act in force at the time of assessment.

The Court examined the penalty provisions under section 271(1)(i) which specify a penalty equal to 2% of the tax for each month of default, not exceeding 50% of the tax. It clarified that the penalty amount must be precisely 2% of the tax for each default month, with no provision for a lower limit. The Court rejected the argument that the absence of a minimum limit allowed for reducing the penalty below the prescribed rate, emphasizing that the penalty should not be less than the specified percentage.

Regarding the consideration of advance tax payments in penalty calculations, the Court referred to Circular No. 16-D (V-50 of 1965) issued by the Central Board of Direct Taxes. The Circular clarified that the net tax payable for penalty calculation should exclude advance tax payments made by the assessee. This instruction indicated that the penalty amount should be determined by excluding tax deducted at source and advance tax payments as per the provisions of section 271(1)(i) of the Income-tax Act, 1961.

In conclusion, the Court answered the reference by affirming that the penalty calculation should adhere to the provisions of section 271(1)(i) without considering advance tax payments. The Court's decision clarified the penalty imposition criteria and upheld the penalty amount determined based on the specified percentage of tax for default months.

Issues:
Assessment of unregistered firm after assessing share income from one partner.

Analysis:
The case involved a question of law regarding the assessment of an unregistered firm after assessing the share income from one of the partners. The firm in question was involved in supplying stores to the military department on contract. The assessment for the firm for the year 1959-60 was completed after one of the partners had already been assessed on his share income from the firm. The Appellate Assistant Commissioner and the Tribunal both held that it is legal for the Income-tax Officer to assess both the partners of an unregistered firm and the firm itself. The Tribunal relied on a previous decision by the Allahabad High Court in Hazari Ram Mohan Ram v. Commissioner of Income-tax to support their conclusion.

The Tribunal referred the question of law to the High Court, which analyzed the issue based on the charging section of the Income-tax Act, 1922. The court highlighted that the charging section imposes tax on different assessable entities, including individuals, Hindu undivided families, companies, local authorities, firms, and other associations of persons. The court emphasized that the tax can be levied either on the firm or its partners individually, but not on both simultaneously. This interpretation was supported by the Supreme Court's decisions in cases such as Commissioner of Income-tax v. Kanpur Coal Syndicate and Commissioner of Income-tax v. Murlidhar Jhawar and Purna Ginning and Pressing Factory.

The court further explained that once the income of an association has been charged to income-tax in the hands of the members individually, there cannot be a fresh assessment of income in the hands of the association. This principle was established in earlier cases like Joti Prasad Agarwal v. Income-tax Officer and was reaffirmed by subsequent decisions, including Commissioner of Income-tax v. Murlidhar Jhawar and Purna Ginning and Pressing Factory. The court clarified that the Income-tax Officer cannot assess the same income twice, once in the hands of the partners and again in the hands of the unregistered firm. The judgment concluded that the Income-tax Officer cannot proceed to assess the income of the firm after it has already been taxed in the hands of the partners. Therefore, the court answered the question referred by the Tribunal in the negative, in favor of the assessee, and awarded costs to the applicant.

Issues:
1. Assessment of a partner's share income from a firm without prior assessment of the firm itself.
2. Legal validity of assessing partners of an unregistered firm individually or collectively.

Analysis:
Issue 1:
The High Court considered two connected references under section 66 of the Indian Income-tax Act, 1922, where the Income-tax Officer assessed two partners of a registered firm on their shares of income without prior assessment of the firm itself. The court addressed the question of whether it was legal to assess the partners' share income from the firm before raising a separate assessment on the firm. The court referred to various precedents, including J. C. Thakkar v. Commissioner of Income-tax, Hazari Ram Mohan Ram v. Commissioner of Income-tax, and Commissioner of Income-tax v. Murlidhar Jhawar and Purna Ginning & Pressing Factory, to establish that partners could be assessed individually without a separate assessment on the firm. The court held that an Income-tax Officer could assess an individual's income from a firm without first assessing the firm itself.

Issue 2:
The court also addressed the legal validity of assessing partners of an unregistered firm individually or collectively. Referring to Commissioner of Income-tax v. Murlidhar Jhawar and Purna Ginning & Pressing Factory, the court highlighted that partners of an unregistered firm could be assessed individually or collectively as a firm. However, the Income-tax Officer could not assess the same income twice, once in the hands of the partners and again in the hands of the unregistered firm. The court emphasized that once the income of an association was charged to income-tax in the hands of the members individually, there could be no fresh assessment of the income in the hands of the association. The court upheld the authority of its previous decision in Hazari Ram Mohan Ram v. Commissioner of Income-tax, allowing an Income-tax Officer to assess an individual's income from a firm without prior assessment of the firm itself.

In conclusion, the High Court answered the question referred to it in the affirmative, ruling in favor of the Income-tax Department. The court directed the assessee to pay the Commissioner of Income-tax costs of the reference in each case.

Issues:
1. Competency of the appeal based on the amendment of the Punjab Pre-emption Act.
2. Reduction of pre-emption money by the High Court.
3. Omission in the High Court decree regarding the order of rival claimants.
4. Interpretation of Section 31 of the Act and its impact on the right of pre-emption.
5. Finality of the trial Court decree and its effect on the appeal process.

Analysis:

1. The appeal before the Supreme Court involved a challenge to the competency of the appellants' right to appeal based on the amendment of the Punjab Pre-emption Act by the Punjab Act X of 1960. The amendment had retrospective effects, affecting the right of pre-emption claimed by the appellants as proprietors of the village. The preliminary objection raised questioned the appellants' right to appeal under the amended Act, highlighting the impact of the legislative changes on their pre-emption rights.

2. The High Court had reduced the pre-emption money from &8377; 1,35,000 to &8377; 1,05,800 in favor of the respondents, triggering the appeal to the Supreme Court by the appellants. The reduction in the pre-emption amount was a central issue in the appeal, leading to a detailed analysis of the High Court's decision and the legal implications of the revised monetary value.

3. An important aspect of the case was the omission in the High Court decree regarding the order in which the rival claimants were entitled to exercise their right of pre-emption. The failure to specify this order raised questions about the completeness and accuracy of the decree, prompting further examination of the legal requirements under Section 28 of the Act and Order 20, Rule 14, Civil P.C.

4. The interpretation of Section 31 of the Act played a significant role in determining the appellants' right to pre-empt the sale. The Supreme Court referred to a previous judgment to establish that the amended Act restricted the courts from passing decrees inconsistent with the amended provisions, impacting the appellants' ability to secure a decree of pre-emption. The legal analysis delved into the retrospective application of the amended law and its implications on the present case.

5. The finality of the trial Court decree and its impact on the appeal process were thoroughly examined. The appellants' argument regarding the conclusiveness of the trial Court decree and its supposed immunity to challenge was refuted, emphasizing the binding nature of the High Court decree and the limitations on the appellants' right to appeal based on the existing legal framework. The analysis highlighted the procedural intricacies and the legal constraints governing the appeal process in pre-emption cases.

Issues Involved:
1. Jurisdiction of the Magistrate under Section 523 of the Criminal Procedure Code (CrPC).
2. Powers of Customs Officers under Section 110 of the Customs Act, 1962.
3. Applicability of Section 550 of the CrPC in the context of seizure by police officers.
4. Interplay between the Customs Act and the CrPC regarding the seizure and disposal of property.
5. Validity and propriety of the Magistrate's order for the return of the seized truck.

Detailed Analysis:

1. Jurisdiction of the Magistrate under Section 523 of the CrPC:
The primary issue was whether the Magistrate could pass an order under Section 523 of the CrPC for the return of the truck seized by the Customs Officer. The court examined whether the Magistrate had the jurisdiction to make such an order when the vehicle was seized under the Customs Act. It was argued that the Magistrate's jurisdiction is not solely dependent on a report from the police officer, and the Magistrate can make an order regarding the disposal of property seized by the police under Section 523 of the CrPC.

2. Powers of Customs Officers under Section 110 of the Customs Act, 1962:
The court analyzed the powers of Customs Officers under Section 110 of the Customs Act, which allows them to seize goods if they believe the goods are liable to confiscation. The Customs Officer seized the truck and goods in question under this provision. The court emphasized that the Customs Officer has broad powers to seize goods suspected to be smuggled, regardless of who has custody of them.

3. Applicability of Section 550 of the CrPC in the context of seizure by police officers:
The court discussed whether the police officer had the authority to seize the truck under Section 550 of the CrPC, which allows police officers to seize property suspected to be involved in an offense. The court noted that the police officer did not report the seizure to his superior or the Magistrate as required by Sections 550 and 523 of the CrPC. Instead, the goods were handed over to the Customs Officer, who then seized them under the Customs Act.

4. Interplay between the Customs Act and the CrPC regarding the seizure and disposal of property:
The court examined the interaction between the Customs Act and the CrPC. It was argued that once the Customs Officer seized the goods under Section 110 of the Customs Act, the Magistrate's jurisdiction under Section 523 of the CrPC was ousted. The court referred to previous cases, such as the Bombay High Court's decision in Vasantlal v. Union of India, which supported the view that Customs Officers have the authority to seize goods even if initially seized by other authorities.

5. Validity and propriety of the Magistrate's order for the return of the seized truck:
The court concluded that the Magistrate's order to return the truck was without jurisdiction and improper. The Customs Officer had lawfully seized the truck under the Customs Act, and the Magistrate had no authority to order its return. The court set aside the Magistrate's order and directed the Magistrate to pass consequential orders in line with the petitioner's undertaking.

Conclusion:
The reference was accepted, and the impugned order dated 5th April 1969 was set aside. The Judicial Magistrate, First Class, Umbergaon, was directed to comply with the petitioner's undertaking as per the orders given in Miscellaneous Criminal Application No. 111 of 1969. The court emphasized the broad powers of Customs Officers under the Customs Act and the limited jurisdiction of Magistrates in such matters.

Issues Involved:
1. Validity of Proviso (2) to Section 10(2) of the Bihar Land Reforms (Amendment) Act, 1964.
2. Operation of the second sub-rule of Rule 20 of the Bihar Minor Mineral Concession Rules, 1964.
3. Legislative competence of the Bihar State Legislature to amend the Bihar Land Reforms Act.
4. Constitutionality of Section 15 of the Mines and Minerals (Regulation and Development) Act, 1957.
5. Impact on fundamental rights under Articles 31 and 19 of the Constitution.

Detailed Analysis:

1. Validity of Proviso (2) to Section 10(2) of the Bihar Land Reforms (Amendment) Act, 1964
The Supreme Court examined the amendment to Section 10 of the Bihar Land Reforms Act, which added a proviso stipulating that terms and conditions of leases for minor minerals would be substituted by those prescribed under the Bihar Minor Mineral Concession Rules, 1964. The Court found that this amendment was beyond the legislative competence of the Bihar State Legislature. The Court held that the entire legislative field concerning minor minerals was covered by the Mines and Minerals (Regulation and Development) Act, 1957 (Act 67 of 1957), which declared that regulation of mines and mineral development was under the control of the Union. Thus, the proviso was invalid.

2. Operation of the Second Sub-rule of Rule 20 of the Bihar Minor Mineral Concession Rules, 1964
The second sub-rule of Rule 20 applied the provisions of the Bihar Minor Mineral Concession Rules retrospectively to existing leases. The Court held that vested rights could not be altered by mere rule-making power without legislative authority. Since the power to modify existing leases was not within the competence of the State Legislature, the second sub-rule was deemed ineffective.

3. Legislative Competence of the Bihar State Legislature to Amend the Bihar Land Reforms Act
The Court analyzed whether the Bihar State Legislature had the authority to amend the Bihar Land Reforms Act to include the second proviso to Section 10. The Court held that the legislative competence was lacking because the subject of minor minerals was already covered by the Union legislation (Act 67 of 1957). The declaration in Section 2 of Act 67 of 1957 and the provisions of Section 15 indicated that the regulation of minor minerals was a Union subject, leaving no room for State legislation.

4. Constitutionality of Section 15 of the Mines and Minerals (Regulation and Development) Act, 1957
The appellants argued that Section 15 of Act 67 of 1957, which delegated rule-making power to the State Governments, was unconstitutional due to excessive delegation. The Court did not find merit in this argument, as the delegation was within the legislative competence of Parliament and did not violate any constitutional provisions.

5. Impact on Fundamental Rights under Articles 31 and 19 of the Constitution
The appellants contended that the amendment to the Bihar Land Reforms Act and the Bihar Minor Mineral Concession Rules infringed upon their fundamental rights under Articles 31 (right to property) and 19 (freedom to practice any profession or to carry on any occupation, trade, or business). The Court held that since the legislative competence to amend the Bihar Land Reforms Act was lacking, the question of infringement of fundamental rights did not arise.

Conclusion
The appeals were allowed, and a mandamus was issued restraining the State Government from enforcing the second proviso to Section 10(2) of the Bihar Land Reforms (Amendment) Act, 1964, and the second sub-rule of Rule 20 of the Bihar Minor Mineral Concession Rules, 1964. The Court concluded that the legislative field concerning minor minerals was exclusively within the jurisdiction of the Union, and the State Legislature had no authority to enact the disputed provisions.

Issues Involved:
1. Validity of penalty reduction under Section 271(1)(a) of the Income-tax Act, 1961.
2. Applicability of Section 271 of the new Act for defaults committed under the old Act.
3. Interpretation of Section 297(2)(g) of the new Act.
4. Calculation of penalty considering advance tax and tax deducted at source.

Issue-wise Detailed Analysis:

1. Validity of Penalty Reduction under Section 271(1)(a) of the Income-tax Act, 1961:
The Tribunal initially imposed a penalty of Rs. 4,781.12 on the assessee for late filing of the return. However, the Tribunal reduced this penalty to Rs. 1,000, citing redeeming features in the case. The High Court was tasked with determining whether this reduction was legally valid. The court examined the provisions of Section 271(1)(a) of the new Act, which prescribes a penalty of 2% of the tax for every month of default, not exceeding 50% of the tax. The court concluded that the penalty must be calculated strictly as per the new Act's provisions, thus questioning the Tribunal's discretion in reducing the penalty.

2. Applicability of Section 271 of the New Act for Defaults Committed under the Old Act:
The court considered whether Section 271 of the new Act could be applied to defaults committed when the old Act was in force. The court noted that Section 297(2)(g) of the new Act explicitly states that penalties for assessments completed on or after April 1, 1962, should be imposed under the new Act. The court rejected the argument that penalty proceedings should follow the old Act, emphasizing the express provision in Section 297(2)(g) mandating the application of the new Act for such penalties.

3. Interpretation of Section 297(2)(g) of the New Act:
The court addressed the controversy regarding the constitutionality of Section 297(2)(g). While some high courts, like the Bombay High Court, found it discriminatory, the Rajasthan High Court, along with the Allahabad and Madhya Pradesh High Courts, upheld its validity. The court clarified that its jurisdiction in a reference does not extend to examining the constitutionality of statutory provisions. The court emphasized that Section 297(2)(g) explicitly mandates that penalties for assessments completed after April 1, 1962, must follow the new Act, thus providing clear legislative intent.

4. Calculation of Penalty Considering Advance Tax and Tax Deducted at Source:
The court examined how penalties should be calculated, particularly whether advance tax and tax deducted at source should be considered. Referring to Circular No. 10-D issued by the Central Board of Direct Taxes, the court noted that the "tax payable" under Section 271(1)(a) should exclude advance tax and tax deducted at source. This interpretation aligns with Section 219 of the new Act, which treats advance tax payments as payments towards the tax liability for the relevant assessment year. Consequently, the penalty must be calculated on the net tax payable after accounting for these deductions.

Conclusion:
The High Court concluded that the penalty must be imposed strictly according to Section 271(1)(a) of the new Act, considering the net tax payable after excluding advance tax and tax deducted at source. The Tribunal's reduction of the penalty to Rs. 1,000 was not legally valid, and the penalty should be recalculated as per the statutory provisions. The reference was answered accordingly, with no order as to costs.

Issues:
1. Competency of the Income-tax Appellate Tribunal to entertain objections to the Gift-tax Act's constitutionality.
2. Constitutionality of the Gift-tax Act in imposing tax on gifts of land and building.

Analysis:

The High Court of Rajasthan addressed the issue of the Income-tax Appellate Tribunal's competence to entertain objections to the constitutionality of the Gift-tax Act. The Tribunal had referred two questions to the court under section 26(1) of the Act. The first question was whether the Tribunal had the authority to decide objections regarding the Act being ultra vires or unconstitutional. The second question pertained to the Act's constitutionality in imposing tax on gifts of land and building. The case involved an assessee who gifted a bungalow to his wife and sons, which was taxed by the Gift-tax Officer. The assessee raised the argument that taxing gifts of land and buildings fell under the State List of the Constitution. The Tribunal, after examining the constitutional validity, concluded that the provisions taxing gifts of immovable property were beyond the powers of Parliament.

The court considered precedents set by the Supreme Court, emphasizing that taxing authorities are not concerned with the validity of taxing provisions. The Tribunal's authority to delve into the Act's constitutionality was challenged, with the argument that it was constituted under the Indian Income-tax Act, not the Gift-tax Act. Definitions under the Act clarified the roles of Appellate Tribunal, Appellate Assistant Commissioner, and Gift-tax Officer. The court highlighted that while officers under the Income-tax Act could perform Gift-tax functions, the Gift-tax Officer and Appellate Assistant Commissioners were creations of the Gift-tax Act.

Regarding the scope of appeals, the court noted that objections to the vires of the Act could not be entertained by the Gift-tax Officer or the Appellate Assistant Commissioner. Consequently, the assessee could not raise such objections before the Tribunal. Referring to Supreme Court decisions, the court emphasized that if objections to the Act's vires could not be raised at lower levels, they could not be raised before the Tribunal either. Therefore, the Tribunal lacked the authority to refer questions on the Act's constitutionality to the court.

In conclusion, the court answered the first question negatively, indicating that the Tribunal did not have the jurisdiction to entertain objections to the Gift-tax Act's constitutionality. Consequently, the court did not address the second question. No costs were awarded in this matter.

Issues Involved:
1. Whether the Tribunal was right in reducing the penalty imposed on the assessee below the minimum prescribed under section 271(1)(iii) of the Income-tax Act, 1961.
2. Whether the Tribunal was right in holding that the penalty proceedings were properly initiated and that the penalty orders passed by the Inspecting Assistant Commissioner were valid in law.

Issue-wise Detailed Analysis:

1. Reduction of Penalty Below Minimum Prescribed:

The Tribunal's decision to reduce the penalty imposed on the assessee below the minimum prescribed under section 271(1)(iii) of the Income-tax Act, 1961, was challenged. The Tribunal had concluded that section 271(1)(iii) provided a minimum of 20% of the tax sought to be evaded in case of imposition of a penalty by the Income-tax Officer or the Appellate Assistant Commissioner. However, the Tribunal believed that this minimum was not applicable to the Inspecting Assistant Commissioner acting under section 274 or to the Tribunal hearing appeals from penalty orders passed by the Inspecting Assistant Commissioner. The Tribunal reduced the penalties below the 20% limit, considering them excessive.

Upon review, it was determined that the Tribunal's interpretation was incorrect. Section 274(2) of the Income-tax Act, 1961, clearly states that the Inspecting Assistant Commissioner, for the purpose of imposing penalties, has all the powers conferred under Chapter XXI, which includes the statutory limits of penalties prescribed in section 271(1)(iii). The Tribunal and the Inspecting Assistant Commissioner must observe the statutory limits of penalties, and cannot impose penalties beyond the prescribed maximum and minimum limits. Therefore, the Tribunal was wrong in reducing the penalty below the minimum prescribed under section 271(1)(iii).

2. Validity of Penalty Proceedings Initiated:

The Tribunal's decision that the penalty proceedings were properly initiated and the penalty orders passed by the Inspecting Assistant Commissioner were valid in law was also examined. The assessee contended that the penalty proceedings were initiated after the completion of the assessment proceedings, which would render them invalid. The Tribunal, however, held that the penalty proceedings commenced when the Income-tax Officer made a reference to the Inspecting Assistant Commissioner under section 274(2) on August 29, 1964, before the completion of the assessment proceedings on August 31, 1964.

The court reviewed the relevant sections of the Income-tax Act, 1961, particularly sections 271, 274, and 275. It was determined that penalty proceedings commence with the satisfaction of the Income-tax Officer in the course of any proceedings under the Act, and this satisfaction must be recorded before the completion of the assessment proceedings. The Tribunal correctly concluded that the penalty proceedings were initiated on August 29, 1964, when the Income-tax Officer referred the case to the Inspecting Assistant Commissioner, and thus, the penalty orders passed were valid in law.

Preliminary Points:

1. Form of Questions Raised by Tribunal: The Tribunal should not state "At the instance of the assessee" or "At the instance of the Commissioner of Income-tax" when referring questions to the High Court under section 256(1) of the Income-tax Act, 1961. The Tribunal must be satisfied that a question of law fit for reference arises, and therefore, the questions referred must be considered as those of the Tribunal.

2. Raising Questions of Law Without Application: The Tribunal cannot raise a question of law under section 256(1) without an application by the aggrieved party within the prescribed time. The statutory procedure requires an application in the prescribed form within 60 days, with a possible extension of 30 days for sufficient cause. Without such an application, the Tribunal cannot entertain or refer any question of law to the High Court.

Conclusion:

The court concluded that the Tribunal was wrong in reducing the penalty below the minimum prescribed under section 271(1)(iii) and answered the first question in the negative in favor of the revenue. The second question was answered in the affirmative, confirming that the penalty proceedings were properly initiated and the penalty orders were valid in law. Each party was ordered to bear its own costs.

Issues:
1. Interpretation of Section 14 of the Hindu Succession Act regarding the ownership rights of a female Hindu in a partitioned property.
2. Determination of whether a female Hindu becomes an absolute owner or acquires a restricted estate under Sub-section (1) or Sub-section (2) of Section 14 of the Act.

Analysis:
1. The case involved a dispute over the ownership rights of a property awarded to a female Hindu, Smt. Kanso Devi, through an arbitration award. The appellant, Badri Pershad, contended that Smt. Kanso Devi only had a limited estate in the property and sought an injunction to prevent her from alienating it. The trial court and subsequent appellate courts held that Smt. Kanso Devi had become the full owner of the property under Section 14(1) of the Hindu Succession Act, as she had inherited it and the award had simply separated her share by metes and bounds.

2. The central issue for determination was whether the respondent's case fell under Sub-section (1) or Sub-section (2) of Section 14 of the Act. The appellant argued that the estate was restricted by the award and decree, making Sub-section (1) inapplicable. However, the respondent maintained that she had acquired the property at a partition under the Hindu Women's Right to Property Act, thus becoming a full owner under Section 14(1) of the Act, despite previously being a limited owner.

3. The court examined the provisions of Section 14 of the Hindu Succession Act, emphasizing the broad interpretation of the terms "possessed" and "acquired." It was established that possession could be actual, constructive, or as recognized by law, while acquisition encompassed various means such as inheritance, partition, or gift. The court clarified that Sub-section (2) of Section 14 operated as an exception to Sub-section (1) and applied only when a female Hindu acquired property for the first time without any pre-existing right.

4. Referring to precedents, the court affirmed that the purpose of Section 14 was to remove legal disabilities on women's rights and not to interfere with existing contracts or grants. A relevant case highlighted the transition of a female Hindu from a limited interest to full ownership under Section 14(1) upon the Act's enforcement. The court concluded that the respondent had become a full owner of the property upon the Act's commencement, rejecting the appellant's argument that the partition through arbitration triggered Sub-section (2) instead.

5. Ultimately, the court dismissed the appeal, upholding the lower courts' decisions and ruling in favor of the respondent, Smt. Kanso Devi. The appellant's contentions regarding the restricted estate and alienation rights were refuted, affirming the respondent's status as the full owner of the property under Section 14(1) of the Hindu Succession Act.

Issues Involved:
1. Validity of the notice under section 154 of the Income-tax Act, 1961.
2. Applicability of the 1961 Act to assessments completed under the 1922 Act.
3. Jurisdiction of the Income-tax Officer post the appellate order.
4. Requirement of a valid notice under section 35 of the 1922 Act.

Issue-wise Detailed Analysis:

1. Validity of the notice under section 154 of the Income-tax Act, 1961:
The petitioner challenged the notice dated 19th April 1967, issued under section 154 of the Income-tax Act, 1961, proposing to rectify the assessment for 1959-60. The petitioner contended that the assessment order had merged with the order of the Appellate Assistant Commissioner, who alone could rectify it. The court observed that section 154(1A) of the 1961 Act, introduced in 1964, allowed the Income-tax Officer to rectify any matter not considered or decided by the Appellate Assistant Commissioner. Since the valuation of bonus shares was not specifically addressed by either the Income-tax Officer or the Appellate Assistant Commissioner, the notice under section 154(1A) was deemed valid.

2. Applicability of the 1961 Act to assessments completed under the 1922 Act:
The petitioner argued that the assessment for 1959-60, completed under the 1922 Act, could not be rectified under the provisions of the 1961 Act. The court examined section 297(2)(a) of the 1961 Act, which provided for the continuation of proceedings as if the repealing Act had not been passed. The court referred to the Supreme Court's decisions in S. Sankappa v. Income-tax Officer and Kalawati Devi Harlalka's case, which held that rectification proceedings are part of the assessment process. Therefore, the proceedings could be initiated under section 35 of the 1922 Act, and the notice under section 154 of the 1961 Act was not valid for rectifying assessments completed under the 1922 Act.

3. Jurisdiction of the Income-tax Officer post the appellate order:
The petitioner contended that after the appellate authority had disposed of the appeal, the effective order was that of the appellate authority, and the Income-tax Officer could not rectify it. The court agreed with this contention, stating that the assessment order had merged with the appellate order, and only the Appellate Assistant Commissioner could rectify it. The court cited the Supreme Court's decisions in Commissioner of Income-tax v. Amritalal Bhogilal & Co. and Collector of Customs v. East India Commercial Ltd., which supported this view.

4. Requirement of a valid notice under section 35 of the 1922 Act:
The petitioner argued that a valid notice under section 35 of the 1922 Act was the foundation of the Income-tax Officer's jurisdiction to rectify the assessment order. The court referred to the decision in Income-tax Officer North Satara v. Arvind N. Mafatlal, which emphasized the importance of a valid notice for jurisdiction. However, the court also considered the recent decision in Giridharilal Jhajharia v. Commissioner of Income-tax, which held that the jurisdiction to rectify flows from the statutory provisions and not from the notice itself. The court concluded that the notice under section 154 of the 1961 Act was a mere irregularity and did not nullify the proceedings, provided the assessee was given a reasonable opportunity to be heard.

Conclusion:
The court quashed all proceedings pending under the impugned notice and directed the respondents to forbear from taking any further steps in pursuance thereof. The rule was made absolute, and each party was ordered to bear its own costs.

Issues Involved:
1. Whether the short story "Shama" published in the 1962 Diwali Issue of Rambha is obscene under Section 292 of the Indian Penal Code (IPC).
2. Whether the conviction and fine imposed by the Bombay High Court on the printer, publisher, and writer of the story were justified.

Issue-wise Detailed Analysis:

1. Obscenity of the Short Story "Shama" under Section 292 IPC:
The primary issue was whether the short story "Shama" contained passages that could be deemed obscene under Section 292 IPC. The complainant alleged that certain passages in the story were obscene and capable of corrupting and depraving the minds of readers, especially the young. The complainant provided evidence from Dr. P.G. Sahstrabudhe and Dr. G.V. Purohit to support the claim of obscenity. The accused, including the writer and the publisher, denied these allegations, arguing that the story depicted the frustration in the life of a poet and had literary and artistic merit. The court examined the passages in question and considered the overall context of the story.

2. Conviction and Fine Imposed by the Bombay High Court:
The Bombay High Court had reversed the order of acquittal by the Magistrate for the printer and publisher (accused 1) and the writer (accused 2), convicting them under Section 292 IPC. The High Court imposed a fine of Rs. 25/- on each of the accused, with a default sentence of simple imprisonment for a week. Additionally, the High Court ordered the destruction of copies of the magazine containing the story. The Supreme Court examined whether this conviction was justified based on the evidence and the legal standards for obscenity.

Detailed Analysis:

Obscenity of the Short Story "Shama":
The Supreme Court noted that the determination of obscenity does not solely depend on oral evidence but on the court's assessment of the material in question. The court referred to the test laid down in Hicklin's case, which considers whether the matter tends to deprave and corrupt those whose minds are open to such influences. The court also referred to the precedent set in Udeshi v. State of Maharashtra, emphasizing that the overall view of the work must be taken, and the obscene passages must be considered in context.

The story "Shama" was about the life of a poet named Nishikant and his relationships with three women: Neela, Vanita, and Shama. The court found that the story depicted Nishikant's emotional and sensitive nature and his struggles with love and relationships. The court observed that the story did not contain explicit descriptions of sexual acts or vulgar language. Instead, it portrayed the characters' emotions and relationships in a restrained manner.

The court concluded that the story did not amount to pornography or pander to prurient interests. The passages in question did not deprave or corrupt readers, nor did they advocate licentious behavior. The court emphasized that the concept of obscenity varies with contemporary societal standards and that the story did not transgress public morality or decency.

Conviction and Fine Imposed by the Bombay High Court:
The Supreme Court disagreed with the High Court's finding that the passages in "Shama" offended Section 292 IPC. The court noted that the High Court had not found certain passages objectionable and that the overall context of the story did not support a charge of obscenity. The court held that the story did not have the effect of corrupting the morals of readers or arousing impure thoughts.

The court reiterated that contemporary societal standards must be considered and that the story did not fall within the definition of obscene material. The court found that the High Court's conviction and fine were not justified based on the evidence and the legal standards for obscenity.

Conclusion:
The Supreme Court allowed the appeal, set aside the conviction and fine imposed by the Bombay High Court, and directed the refund of the fine if paid. The court held that the short story "Shama" did not violate Section 292 IPC and did not corrupt or deprave the minds of readers. The judgment emphasized the importance of considering the overall context of literary works and contemporary societal standards in determining obscenity.

Appeal allowed.

Issues:
1. Valuation of appeal for jurisdiction
2. Extension of time under Section 5 of the Limitation Act
3. Mistake of counsel in filing appeal

Analysis:

1. Valuation of appeal for jurisdiction:
The case involved a dispute regarding the correct valuation of an appeal for jurisdictional purposes. The appellant initially valued the appeal at Rs. 4,880, intending to file it in the District Court. However, the correct valuation was Rs. 5,930, necessitating the appeal to be filed before the High Court. The District Judge upheld a preliminary objection, stating that the appeal should be returned for presentation to the proper court. The High Court, in its judgment, emphasized the importance of adhering to the correct valuation for jurisdictional purposes as per the Punjab Courts Act. The appellant argued that the mistake in valuation was due to the counsel's error, leading to a delay in the appeal process.

2. Extension of time under Section 5 of the Limitation Act:
The appellant sought an extension of time under Section 5 of the Limitation Act to condone the delay in filing the appeal. The High Court, however, denied the extension, citing that there was no ground for extending time. The appellant contended that the mistake in valuation, which led to the delay, was not intentional but a genuine error on the part of the counsel. The Supreme Court highlighted the importance of considering whether the mistake of counsel was bona fide or an attempt to circumvent the Limitation Act. The Court noted that the appellant did not attempt to save court fees and had sufficient time to file the appeal in the High Court, indicating that the error was not motivated by ulterior purposes.

3. Mistake of counsel in filing appeal:
The central issue revolved around the mistake made by the appellant's counsel in valuing the appeal for jurisdictional purposes. The High Court questioned the counsel's experience and knowledge, considering the clear provisions in the Punjab Courts Act regarding appeal valuations. The Supreme Court acknowledged that while mistakes of counsel could be considered in certain circumstances, the crucial factor was whether the mistake was bona fide or aimed at manipulating the legal process. The Court found that the counsel's error was not malicious but a misinterpretation of the rules, particularly Rule 4 in Chapter 3B of the High Court's rules and orders. The Court concluded that the error was not intentional and warranted an extension of time under Section 5 of the Limitation Act.

In conclusion, the Supreme Court set aside the High Court's order, remitting the appeal for further proceedings while directing the appellant to bear the respondent's costs. The judgment emphasized the need to evaluate mistakes of counsel in a fair and objective manner, considering the circumstances and intentions behind such errors.

Issues Involved:
1. Legislative competence of Parliament to levy excise duty under Section 12 of the Rubber Act, 1947.
2. Excessive delegation of powers to the Rubber Board under Section 12(2).
3. Clarity and precision in the rules framed under Section 12(2) regarding the levy and collection of duty.

Issue-wise Detailed Analysis:

1. Legislative Competence of Parliament to Levy Excise Duty:
The primary contention was whether the duty imposed under Section 12 of the Rubber Act, 1947, as amended, falls within the ambit of Entry 84 of List I in the Seventh Schedule to the Constitution. The appellant argued that excise duty could only be levied on producers and manufacturers of rubber, not on users or consumers.

The court examined the nature of excise duty and concluded that while the duty is primarily on production or manufacture, the method of collection can vary. The court cited previous judgments to affirm that excise duty's essence remains unchanged irrespective of the collection stage. The court also noted that Parliament has legislative competence under Entry 97 of List I in the Seventh Schedule, read with Article 248 of the Constitution, to impose such a duty.

2. Excessive Delegation of Powers to the Rubber Board:
The appellant argued that Section 12(2) of the Act suffers from excessive delegation, conferring uncontrolled discretion on the Rubber Board to levy and collect duty from either the owners of rubber estates or the manufacturers without clear guidelines.

The court held that the legislative policy and guiding principles were sufficiently clear in the Act. The Board, a high-powered body with diverse representation, is entrusted to levy and collect the duty in accordance with rules framed by the Central Government. The court emphasized that the Act's preamble and provisions ensure that the Board's actions are subject to Central Government control, providing adequate safeguards against arbitrary exercise of power.

3. Clarity and Precision in the Rules:
The appellant contended that the rules framed under Section 12(2) lacked clarity and precision regarding whom the levy is to be made and from whom the duty is to be collected.

The court acknowledged that the rules, particularly Rule 33D, were not well-worded and lacked clarity. However, it interpreted the rules to mean that demand notices for duty payment are to be sent only to manufacturers, not to owners of rubber estates. This interpretation aligns with the practical difficulties in collecting duty from numerous small estate owners and the easier administration of collecting from a smaller number of manufacturers.

Conclusion:
The court dismissed the appeal, holding that:
1. Parliament has the legislative competence to levy the excise duty under Section 12 of the Rubber Act, 1947.
2. Section 12(2) does not suffer from excessive delegation as the Act provides sufficient legislative policy and guidelines.
3. The rules, though not clearly worded, effectively designate manufacturers as the primary category from whom the duty is to be collected.

The appeal was dismissed with costs, affirming the validity and legality of the levy of cess by way of excise duty on rubber used by manufacturers of chappals.

Issues:
1. Interpretation of the legality of a gift of Rs. 4 lakhs made by a Hindu undivided family.
2. Determination of whether interest accruing on the gifted amount is taxable for income-tax purposes.
3. Analysis of whether the gifted amount remains an asset of the assessee family for wealth-tax purposes.

Analysis:
1. The court addressed the legality of a gift of Rs. 4 lakhs made by a Hindu undivided family to various members. The Income-tax Officer initially rejected the gift, assessing the total income of the family by including the gifted amount and interest. The Appellate Assistant Commissioner later ruled in favor of the assessee, leading to an appeal by the department. The Tribunal, citing precedent, directed the deletion of the amount from assessments. The court examined the distinction between void and voidable transactions, emphasizing that only interested parties could challenge the legality of a gift. The court concluded that even if the gift was void, the income earned did not accrue to the assessee for income-tax purposes.

2. Regarding the interest accruing on the gifted amount, the court highlighted that the Income-tax Act taxes the person who earns the income, not the one holding title to the property. The court rejected the argument that the assessee should be taxed based on title ownership, drawing a parallel with a thief earning income from stolen money. The court emphasized that the income-tax liability is on the actual earner of income, not merely the title holder of the property. The court cited relevant legal provisions and clarified that the interest did not accrue to the assessee family for income-tax purposes, regardless of the gift's legal status.

3. The court also addressed the issue of whether the gifted amount remained an asset of the assessee family for wealth-tax purposes. The court analyzed the definition of net wealth under the Wealth-tax Act and concluded that the gifted amount had ceased to be an asset of the assessee family. Even though the family members might have a right to recover the gifted amounts, the court ruled that it did not qualify as a tangible asset attracting wealth-tax assessment. The court rejected the application of a specific provision cited by the department, emphasizing that the transfer of assets was not irrevocable. Consequently, the court determined that the gifted amount, along with estimated interest, could not be taxed under the Wealth-tax Act.

In conclusion, the court answered both references in favor of the assessee, determining that the gifted amount and interest did not accrue to the assessee family for income-tax and wealth-tax purposes, respectively.

Issues:
1. Validity of dismissal order by Shri Ghatpande under Section 13 of the Indore Municipal Act, 1909.
2. Defense of limitation under Section 135(2) of the Indore Municipal Act, 1909.
3. Applicability of Article 120 of the Limitation Act, 1908.
4. Interpretation of Section 8(1)(b) of the Indore Municipal Act, 1909.
5. Comparison with the case of Bharat Kala Bhandar Ltd. v. Municipal Committee, Dhamangaon regarding jurisdiction.

Analysis:

The judgment concerns an appeal from the High Court of Madhya Pradesh, involving the plaintiff's claim against the Indore Municipal Corporation. The plaintiff sought a declaration that their dismissal was illegal, claiming reinstatement and salary arrears. The trial court decreed in favor of the plaintiff, which was later set aside by the lower appellate court but restored by the High Court.

The primary issue revolved around the authority of Shri Ghatpande to dismiss the plaintiff under Section 13 of the Indore Municipal Act, 1909. The High Court found that there was no official appointment by the Government for Shri Ghatpande to act as Commissioner, rendering his dismissal order invalid for lack of jurisdiction.

Another significant issue was the defense of limitation raised by the Municipal Corporation under Section 135(2) of the Indore Municipal Act. The District Judge initially accepted this defense, but the High Court rejected it, determining that the suit fell under Article 120 of the Limitation Act, 1908, not within the scope of Section 135.

The interpretation of Section 8(1)(b) of the Indore Act was crucial in distinguishing suits against the Municipal Council from those against its officers or servants. The Court highlighted the purpose of Section 135 to allow for corrections within a notice period, emphasizing that the plaintiff's suit did not concern acts done under the Act.

Drawing parallels with the case of Bharat Kala Bhandar Ltd. v. Municipal Committee, Dhamangaon, the judgment clarified that actions taken without jurisdiction, such as the dismissal in this case, do not fall under the protection of statutory provisions like Section 135. The Court emphasized that the suit did not pertain to acts done under the Indore Municipal Act, leading to the dismissal of the appeal.

In conclusion, the appeal was dismissed, affirming the High Court's decision, with the appellant bearing the costs.

Issues:
Constitutionality of Andhra Pradesh Motor Vehicles (Taxation of Passengers and Goods Amendment and Validation) Act, 1961 under Art. 301 and Art. 304(b) of the Constitution; Compliance with proviso to Art. 304(b); Violation of Art. 14; Discrimination in application of the Act to different regions and vehicles on inter-State routes.

The judgment involved a challenge to the constitutionality of the Andhra Pradesh Motor Vehicles (Taxation of Passengers and Goods Amendment and Validation) Act, 1961. The appellants, operators holding permits under the Motor Vehicles Act, 1939, contested the tax imposed under the Act. The Act was enacted to amend and validate previous tax legislation. Initially, the validity of the tax imposed under Act 16 of 1952 was upheld, but subsequent amendments led to legal challenges. The High Court struck down the amendments as unconstitutional for lacking the President's sanction under Art. 304(b). The Validating Act 34 of 1961 was enacted to validate previous acts, amend tax rates, and empower the Government to levy additional taxes. The High Court upheld the validity of the Act, rejecting challenges under Art. 14 and Art. 19(1)(g).

The main points raised before the Supreme Court included: (1) The Act's imposition of tax for revenue augmentation, falling under Art. 301; (2) Examination of reasonableness under Art. 304(b) and Art. 19(1)(g); (3) Allegations of discrimination under Art. 14 due to regional application and taxation of inter-State route vehicles. The Court referred to established principles regarding compensatory taxation and regulatory measures to determine constitutionality under Art. 301 and Art. 304(b). The Court emphasized that compliance with the proviso to Art. 304(b) did not preclude examination of reasonableness and public interest by the court.

The Court analyzed the impact of the tax increase on transporters' businesses, considering profitability and fare adjustments. The High Court's findings on the burden of tax and profitability were reviewed, with the Court concluding that the tax did not unreasonably impede trade. The Court dismissed challenges under Art. 19(1)(g) and Art. 14, highlighting the historical context of tax legislation in different regions and the permissible differentiation in tax laws between states. The appeals were dismissed, upholding the validity of the Andhra Pradesh Motor Vehicles Taxation Act, 1961, with costs awarded to the respondent.

Issues:
1. Taxability of dividend received by the assessee from a company.
2. Determination of whether certain amounts declared as dividend were taxable as income or not.
3. Interpretation of the Income-tax Act regarding the taxability of amounts received from capital gains by the assessee.
4. Referral of questions under section 66(1) of the Indian Income-tax Act, 1922 to the High Court of Calcutta.
5. High Court's ruling on the taxability of amounts received by the assessee from the company.
6. Analysis of previous judgments and their impact on the present case.
7. Setting aside the High Court's order and remanding the case for further consideration.

Analysis:
The case involved the taxability of dividends received by the assessee from a company, Ukhara Estates Zamindaries Ltd. The assessee claimed that certain amounts declared as dividends were not taxable as they were derived from the company's capital gains, specifically from salami received for long-term leases and compensation for land acquisition. The Income-tax Officer initially taxed the entire dividend amount for each year. The Appellate Assistant Commissioner held that only a portion of the amount constituted taxable dividend income. The Appellate Tribunal determined that the portion related to salami received for leases was not taxable as dividend but as income from other sources.

The Tribunal referred three questions to the High Court of Calcutta regarding the taxability of amounts received by the assessee. The High Court, following its previous judgments, answered all questions in the negative, indicating that the amounts were not taxable as dividends. However, the High Court's decision was subject to the final outcome of appeals in related cases pending before the court.

The Supreme Court found fault with the High Court's decision, noting that final answers with reasons were required, and the decision should not be influenced by other judgments. The Court highlighted the need to assess whether the amounts received were capital gains or income, considering the nature of the receipts. Additionally, the Court referred to previous judgments that exempted dividends from capital gains from tax liability under specific conditions.

Consequently, the Supreme Court set aside the High Court's order and remanded the case for further consideration in accordance with the law. The Court did not award costs for the appeal but stated that costs in the High Court would apply to the references.