TMI Blog1985 (3) TMI 108X X X X Extracts X X X X X X X X Extracts X X X X ..... ax collections in the assessment year 1973-74 did not arise. Apart from highlighting these objections, Shri G. R. Agnihotri, the learned authorised counsel of the assessee, has made a few other points. He has, firstly, contended on the authority of the Supreme Court decision in the case of Laxmipat Singhania v. CIT [1969] 72 ITR 291 that unless expressly provided an income which is assessable in one assessment year cannot be assessed in another assessment year. It is next contended on authority of another decision of the Supreme Court in the case of CIT v. Brij Lal Lohia Mahabir Prasad Khemka [1972] 84 ITR 273 that the principle of res judicata does not apply to income-tax proceedings and that in spite of the finding of the Tribunal in the assessment year 1972-73, the amount of Rs. 56,910 could not be assessed in the assessment year 1973-74. It is further contended that the department having failed to identify any allowance of liability in an earlier year, it was not entitled to invoke provisions of section 41(1) in the assessment year 1973-74 and for this reliance has been placed by him on the decision of the Hon'ble Supreme Court in the case of Tirunelveli Motor Bus Service Co. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee on the ground that the sand had been dug and removed from the territory which formed part of the State ofUttar Pradeshand since the sand so dug had been brought to the UnionterritoryofDelhi, it was liable to terminal tax. On receipt of the notice from the Terminal Tax Officer of the MCD, the assessee-firm collected terminal tax from its customers but at the same time it declined its liability to pay terminal tax on the ground that sand had been dug and removed by it from theterritoryofOkhlawhich formed part of the UnionterritoryofDelhi. A suit was filed before Shri Hira Lal Garg, P. C. S., S. J. I. C.,Delhi, asking for permanent injunction against the MCD from imposing or charging any terminal tax from the assessee-firm. As per the order of the Sub-Judge the injunction was granted and the MCD was restrained from collecting any terminal tax from the assessee. The MCD felt aggrieved of the order passed by the first appellate authority and, therefore, an appeal was preferred before the Addl. Senior Sub-Judge,Delhi. The latter upheld the claim of the assessee and dismissed the appeal filed by the MCD vide its order dated19-7-1971. The accounting year of the assessee for the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the beginning of this order. It appears to us that even though the representation made on behalf of the assessee that terminal tax collected in the assessment years 1969-70 and 1970-71 formed part of the trading receipts of the assessee of those years in accordance with the decisions given by the Hon'ble Supreme Court in the cases of Chowringhee Sales Bureau (P.) Ltd. and Sinclair Murray Co. (P.) Ltd. cannot but be accepted, the other relevant facts cannot be lost sight of. The assessee did not account for the terminal tax collection of Rs. 53,549 in the assessment year 1969-70 as a part of its trading receipts. Similarly, it also did not account for the sum of Rs. 3,361 as trading receipts in the assessment year 1970-71. The reason why the receipts or collections of terminal tax had not been shown as trading receipts was that the assessee had to pay the similar sums as its liability of terminal tax which had been demanded by the MCD. The net result of the entries made in the books of account of the assessee was that while on the one hand it reduced the credit side of the trading account by not accounting for the collection of terminal tax amounting to Rs. 56,910 in the two ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the year in which the order of the Senior Sub-Judge had been received. Since the order of the Senior Sub-Judge was dated19-7-1971and since it was received in the accounting year of the assessment year 1973-74, which was from1-7-1971to30-6-1972, the amount had to be taxed in the assessment year 1973-74 in pursuance of the order of the Tribunal. 9. Now we may deal with the other arguments of Shri G. R. Agnihotri. There can be no scope for disputing the contentions raised by him which are based on the authorities of the Hon'ble Supreme Court in the cases of Laxmipat Singhania, Brij. Lal Lohia and Mahabir Prasad Khemka and Tirunelveli Motor Bus Service Co. (P.) Ltd. What we fail to discern is as to how the ratio and decisions in the abovementioned cases help the assessee. It had been held in the decision of the Hon'ble Supreme Court in the case of Laxmipat Singhania that the fundamental rule of taxation is that, unless otherwise expressly provided, an income cannot be taxed twice and that it is not open to the ITO to ignore the accrual of income in the year of accrual and thereafter to tax it on the happening of some other event. In the present case, what had happened was that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 41(1) in a subsequent year would not apply. In the present case, as we have repeatedly stated in the preceding portions of the order, the assessee had actually obtained the benefit of deduction of terminal tax when it did not account for the collection thereof as a part of its trading receipts. Having reduced its gross trading receipts by amounts of terminal tax collected, it does not lie in the hands of the assessee to contend that the recoupment of the same liability on its remission or cessation in the assessment year 1973-74 was not permissible under law. The decision in the case of Tirunelveli Motor Bus Service Co. (P.) Ltd. would, therefore, not apply on the facts and in the circumstances of the present case. 10. In the above view of the matter, we hold that the lower authorities were justified in invoking the provisions of section 41(1) and in bringing to assessment the remission of liability of terminal tax amounting to Rs. 56,910 in the assessment year 1973-74. The various grounds taken in the petition of appeal and all the arguments raised by the learned counsel of the assessee are found not acceptable in view of the reasons given as above. 11. In conclusion, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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