TMI Blog1971 (8) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... ls from judgments of the Calcutta High Court in income-tax references involve a common question. We shall refer to the facts in the batch of appeals of Jaipuria Samla Amalgamated Collieries Ltd. The assessee is a public limited company incorporated under the Indian Companies Act, 1913. It carried on the business of raising coal from coal mines and selling the same to its constituents. It had taken on lease several coal mines from the owners of the coal bearing lands. As lessee of the mines the assessee incurred liability for payment of, (i) Road and Public Works cess under the Bengal Cess Act of 1889 ; (ii) Education cess levied under the Bengal (Rural) Primary Education Act, 1930. The amounts payable by the assessee on account of the af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court for giving reasons, petitions for special leave were filed before us and leave was granted. We have heard the appeals by special leave on the printed record of the appeals by certificate. It may be mentioned that this position obtains in all the appeals by certificate before us. Section 10(1) of the Act provides that tax shall be payable by an assessee under the head "profits and gains of business, profession or vocation" in respect of the profits and gains of any business, profession or vocation carried on by him. Sub-section (2) says that such profits or gains shall be computed after making the allowances set out therein. Clauses (ix) and (xv) of this sub-section are as follows : " (ix) any sums paid on account of land r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perty, inter alia, to provide for the construction and maintenance of roads and other works of public utility. Under section 5 all immovable property with certain exceptions was to be liable to the payment of road cess and public works cess. Section 6 laid down that these cesses were to be assessed on the annual value of lands and until provision to the contrary was made by Parliament on the annual net profits from mines, quarries, tramways, railways and other immovable property on such rates as were to be determined in the manner prescribed. Under section 72 the Collector of the district had to serve a notice upon the owner, etc., of every mine, quarry, tramway, railway and immovable property requiring him to lodge a return of the net annu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of three and a half pice on each rupee of the annual net profits. Now it is quite clear that the aforesaid cesses would be allowable deductions either under clause (ix) or clause (xv) of sub-section (2) of section 10 unless they fell within section 10(4). We have already referred to the provisions of both Acts under which the cesses are levied which show that their assessment is not made at a proportion of the profits of the assessee's business. What has to be determined is whether the assessment of the cesses is made on the basis of any such profits. The words "profits and gains of any business, profession or vocation" which are employed in section 10(4) can, in the context, have reference only to profits or gains as determined under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etch of reasoning be equated to the profits which are determined under section 10 of the Act. It is not possible to see, therefore, how section 10(4) could be applicable at all in the present case. Thus, on the language of the provisions both of the Act and the two Cess Acts the applicability of section 10(4) cannot be attracted. But even according to the decided cases such cesses cannot fall within section 10(4). The Privy Council in Commissioner of Income-tax v. Gurupada Dutta, had to consider whether the rate imposed under the provisions of the Bengal Village Self Government Act, 1919, on a person occupying a building and using the same for the purpose of business was an allowable deduction in computing the profits of the business under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner of Income-tax v. Banarsi Dass Sons, the Punjab High Court held that a tax imposed under the U. P. District Boards Act on circumstances and property could be legitimately claimed as an allowance and the above decision of the Privy Council was followed. In the Income-tax Act, 1961, section 28 relates to the income which shall be chargeable to income-tax under the head "profits and gains of business or profession". Section 30(b)(ii) is equivalent to clause (ix) of section 10(2) of the Act. Section 40(a)(ii) corresponds to section 10(4) of the Act. It is significant that in spite of the decision of the Privy Council in Gurupada Dutta's case, Parliament did not make any change in the language of the provisions corresponding to sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
