TMI Blog2003 (5) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... accept the contention of learned counsel for the petitioner that the income of the petitioner is exempt under article 289(1) of the Constitution of India, we are constrained to hold that the notification annexure P-1, is perfectly valid and cannot be successfully challenged on the ground urged by the petitioner-authority – Petition dismissed. - - - - - Dated:- 8-5-2003 - Judge(s) : P. K. BALASUBRAMANYAN., RAMESH KUMAR MERATHIA JUDGMENT P.K. BALASUBRAMANYAN C.J.-When this writ petition came up for admission on the adjourned, date, it was submitted by counsel for the parties that the pleadings are complete and the writ petition itself may be heard and finally disposed of. Accordingly, we have heard the writ Petition in full and the judgment is being pronounced thereon. The petitioner is the Adityapur Industrial Area Development Authority, a body corporate under the Bihar Industrial, Area Development Authority Act, 1974, having perpetual succession and a common seal. The petitioner challenges annexure P-1 issued by the Deputy Commissioner of Income-tax, T.D.S. Circle, Jamshedpur, to the Central Bank of India, the petitioner's banker. Admittedly, interest was due to the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he income of a State contained in article 289(1) of the Constitution. This stand of the petitioner-authority was met by the respondents by pointing out that the income of the authority created under the Bihar Industrial Areas Development Authority Act was not income of the State or the property of the State and hence article 289(1) of the Constitution had no application. Neither counsel brought to our notice any direct authority on the question. The nearest authority we could come across was the decision in Gujarat Industrial Development Corporation v. CIT [1997]227 ITR 414 (SC). The said appeal arose from the decision of the Gujarat High Court, reported in Gujarat Industrial Development Corporation v. CIT [1985] 151 ITR 255. Two questions were formulated for being answered in that decision. One was that the income of the Development Corporation was not liable to be taxed under the Income-tax Act in view of article 289(1) of the Constitution. The second was whether the income was liable to be excluded under section 10(20A) of the Income-tax Act. The Gujarat High Court held that the income was not liable to be excluded under article 289(1) of the Constitution. It also held that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax in view of article 285(1) of the Constitution. In Board of Trustees for the Visakhapatnam Port Trust v. State of A.P. AIR 1999 SC 2552; [1999] 6 SCC 78, the Supreme Court held that the property belonging to a port trust is not the property of the Union within the meaning of article 285(1) of the Constitution. In Municipal Commissioner of Dum Dum Municipality v. Indian Tourism Development Corporation [1995] 5 SCC 251, property of the airport authority was held to be not that of the Union. In Central Warehousing Corporation v. Municipal Corporation [1994] Suppl. 3 SCC 316, the property of the warehousing corporation was held to be not the property of the Union within the meaning of article 285(1) of the Constitution. In Western Coalfields Ltd. v. Special Area Development Authority, Korba, AIR 1982 SC 697, it was held that the property of a company incorporated under section 617 of the Companies Act, 1956, in which the entire shares were held by the Union Government, was not the property of the Union in terms of article 285(1) of the Constitution. This line of decisions, in our view, show that the properties of a statutory corporation or a Government owned company or other authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o referred to therein. But from that it is not possible to proceed and hold that the income of the Development Authority is that of the State and consequently is exempt from taxation under article 289(1) of the Constitution. Similarly, the passage read from Marshal on Constitutional Theory and the quotation from Halsbury contained therein, also do not advance the case of the petitioner. What is involved herein is the question whether the property owned by the petitioner-Development Authority, a Corporation created under the Development Authority Act, is the income or property of the State Government. Learned counsel for the Department cited the decision of the Supreme Court in In re, Sea Customs Act, AIR 1963 SC 1760. Therein it was opined that by and large taxes on income, duties of customs and duties of excise are within the exclusive power of legislation by Parliament. It was also stated therein that article 289 of the Constitution and its contemporary article 285 together read, clearly express the intention of the Constitution makers that article 285 would govern all properties of the Union from all taxes on property levied by a State or by any authority within the State and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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