TMI Blog1972 (12) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... er the Income-tax Act, 1961, in pursuance of his notice of demand dated March 22, 1970. For the assessment year 1965-66 the respondent passed an assessment order dated March 23, 1970, in the petitioner's case under section 143(3) of the Income-tax Act, 1961. In that order the taxable income of the petitioner was computed at Rs. 4,98,700 after giving deduction of Rs. 71,130 towards annuity deposit payable by him under section 280-O. The petitioner had paid a sum of Rs. 8,610 as annuity deposit during the year and deducting the said sum, a demand had been issued on March 22, 1970, for the balance of the annuity deposit of Rs. 62,520 in Form 37B under section 156 of the Income-tax Act read with rule 48A(ii). of the Income-tax Rules, 1962. The petitioner has challenged the validity of that demand in this writ petition on various grounds. It is contended that Chapter XXII-A dealing with annuity deposit was inserted in the Income-tax Act, 1961, by section 44 of the Finance Act of 1964 with effect from 1st April, 1964, that under the said scheme of annuity deposit the taxpayers have the option to make or not to make deposit, that the annuity deposit not being tax, there cannot be any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the face of these rival contentions we have to consider whether the impugned demand is illegal and without jurisdiction as contended by the petitioner. The question, therefore, mainly depends upon the effect of the omissions of sections 280K, 280R and 280T as also the deletion of the words "( including annuity deposit referred to in Chapter XXII-A)" from section 156 and the applicability or otherwise of section 6 of the General Clauses Act to the said omissions. It cannot be disputed by the revenue that if section 6 of the General Clauses Act does not apply to the omissions and deletions made in the Income-tax Act by section 32 and Schedule II of the Finance Act of 1966, the demand in question could not be sustained. Thus, the substantial question to be considered in this case is whether section 6 of the General Clauses Act enables the Income-tax Officer to apply the provisions of sections 280K, 280R and 280T even after their omission with effect from April 1, 1967, for purposes of recovery of the amount which has accrued due before that date. Before proceeding to deal with the main contention, it is necessary to consider the nature of the annuity deposit scheme and the ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be deposited as annuity deposit. Section 280C is akin to the charging section and it throws an obligation to make an annuity deposit if the option is not exercised by the taxpayer under section 280X. It is not in dispute that the assessee in this case has not chosen to exercise the option under section 280X within the time referred to therein and in view of the option not having been exercised as contemplated in section 280X, the petitioner is liable to pay the annuity deposit as per the scheme under section 280C. Section 280K enables the Income-tax Officer to pass an order determining the annuity deposit required to be made by an assessee, by way of provisional or regular assessment and section 280-O provides for the deduction on the annuity deposit from computation of the total income assessable. The other provisions of Chapter XXII-A, inter alia, deal with the procedure for recovery of annuity deposit as determined under section 280K. According to the petitioiier, by the omission of sections 280K, 280R and 280T the legislature has shown its intention not to enforce the levy and collection of the annuity deposit after 1st April, 1967, the levy and collection could not be made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )" will not amount to repeal and as such section 6 of the General Clauses Act cannot be invoked. According to the learned counsel wherever the legislature uses the word "omit" instead of the word "repeal" in an amending statute, it should be taken that the legislature has intended to exclude the application of section 6 of the General Clauses Act and this position is said to be clear from the said observations of the Supreme Court. But we are of view that the observations in that case are confined to the facts of that case. Their Lordships were concerned with the omission of a rule and, therefore, they stated that section 6 of the General clauses Act will not apply to an omission of a rule. It is true, the observation appears to suggest that section 6 will apply only to repeals and not to omissions. But as already stated, the observation has to be construed in the light of the fact of that case. In our view, the mere use of the word if "omit" instead of "repeal" by the legislature cannot be taken to show its intention to exclude the application of section 6 of the General Clauses Act as urged by the petitioner. An a matter of fact, the Supreme Court in an earlier decision State o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectly opposed to the wording of section 6. Section 6 uses the words "repeals any enactment" and "enactment" has been defined under section 2(19) of the said Act as including any provision contained in any Act. Therefore, when a provision in an Act is repeabled, it will amount to a repeal of an enactment referred to in section 6. Repealing a provision is the same thing as omitting a provision. We are, therefore, of the view that section 6 of the General Clause Act will Stand attracted on the omission of certain sections by the Finance Act 1966. The learned counsel for the petitioner then contends that even if section 6 were to apply, still there being no actual liability under the annuity deposit scheme before April 1, 1967, neither sub-clause (c) nor sub-clause (d) of section 6 will apply. dAccording to the petititioner the liability to make the annuity deposit it optional and the consequences of non-payment will be that the petitionr will be liable to pay any additional tax as per section 280-X. But we find that the learned counsel is not right in saying that the amount has not become due. Though the petitioner had option not to pay the annuity deposit, that option has to be exe ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
