TMI Blog1961 (1) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner, who carries on business of purchasing and selling medicines as a retailer was assessed to Income Tax for the assessment year 1956-57, accounting period being Samvat Year 2011'. In the course of the assessment proceedings, the Income Tax Officer rejected the books of account of the petitioner and' treated the amount of sales effected by the petitioner at ₹ 4,91,326/- and also enhanced the gross profits of 5.9 per cent disclosed by the petitioner to ten per cent. The result was in increase in the total income of the petitioner from ₹ 19.895/- to ₹ 41,049/-. The petitioner appealed against that order to the Appellate Assistant Commissioner. That appeal was dismissed. The petitioner carried the matter in further appeal to the-Income-tax Tribunal. The Tribunal made some modification in the order but in effect upheld the decision taken by the authorities below,. The petitioner thereafter required the Tribunal under Section 66(2) of the Income Tax Act to draw up a Statement of the Case and raise and refer certain-questions to this Court. The Tribunal dismissed-that application and it is against that order of the Tribunal that the petitioner has com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to the date of the coming into force of the new Act. As we have already mentioned, the last of these contentions raises a question of considerable importance relating to the construction of Certain provisions in the new Court fees Act of 1959 and this Bench has been constituted to decide the same. We may mention that we are at this stage not concerned with the merits of the petition. We are only concerned with the contentions relating to payment of court-fees in respect of this petition. 6. It will be convenient at this stage to indicate the contentions urged before us by Mr. S. P. Mehta, learned counsel for the petitioner, It is contended that on a consideration of the relevant provisions of the Court-fees Act, no court-fee whatever can be said to be payable on an application under Section 66 (2) of the Income Tax Act. The other contention is that even if any court-fee is payable, the correct mode of computation is different from that contended for on behalf of the respondent and the State. The first contention lias been presented in a three-fold manner. The primary and principal argument urged on behalf of the petitioner is that the Act of 1959 is prospective and not retrosp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the commencement of this Act, the laws specified in column 3 of Schedule IV hereto annexed shall be repealed in the manner and to the extent specified in column 4 thereof: Provided that such repeal shall not affect the previous operation of any of the laws so repealed and anything done or any action taken (including any appointment, notification, order, rule, form, application, reference, notice, report or Certificate made Or issued) under any such law shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provision of this Act and shall continue to be in force accordingly, unless and until suspended by anything done or any action taken under this Act: Provided further that all the fees shall be charged and Collected under this Act at the rate in force on the date on which the document chargeable to court-fee is or was presented. X X X. Entry No. 16 in the first Schedule is as under:- Schedule I Number __ Proper fee. 1 2 3 * * * ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the date on which the document chargeable to court-fee is presented. Mr. Mehta has stated before us that one crucial question for our consideration is the interpretation of this section. He has added that this section must however be read along with Section 5 and the schedules to the enactment and also with Section. 49. The submission has been that all these provisions should be read together in a harmonious manner. Here we find ourselves in entire agreement with Mr. Mehta. 12. To turn to Section 49. We are only concerned with Sub-section (1) of that section and a good deal of argument has been advanced before us on the meaning and effect of the language in which that sub-section has been enacted. It will be seen that Sub-section (1) contains the repeal clause. Then there are two provisos. The first proviso no doubt spoken of by the Legislature as such, really is the saving clause, and of that there can be no doubt. Nor has any attempt been made before us by Mr. Mehta to ask us to read Sub-section (1) and the first proviso to that sub-section as anything other than a repealing clause and a saving clause. Then comes the second proviso which, in language of abundant clarity, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may be made consistent and effectual and harmonious and sensible. Every part of it should, as far as possible, be read and treated as sound and effective so that no part of it will be inoperative or superfluous or insignificant. Where there is no sound reason for departing from these principles, for instance in case of a section like the one under examination expressed in language precise and unambiguous, they offered a safe approach and a reliable guide to the ascertainment of the intention of the Jaw-giver. 15. It is in the light of these observations that we turn to examine the provisions contained in Section 49. The Legislature has said in Sub-section (1) of Section 49, which has to be read along with column 4 of Schedule IV, that the whole of the Court-Fees Act, 1870, in so far as it inter alia relates to entries 3 and 66/2 and 47 in the 7th Schedule to the Constitution shall stand repealed from 1st August, 1959. Section 5 which comes into operation on the same day rules in express terms that no document specified as chargeable in the first or the second schedule to the Act shall be received in any Court unless the court-fee as indicated in any of the Schedules to the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before inviting the application of the second proviso, it must be established that the document is chargeable to court-fees under the Act. And the further suggestion is that the petition is not a document which is chargeable to court-fees under the Act. This, in our opinion, is arguing in a circle The question here is one simply of retrospective-operation or prospective application and we have to examine the language of the second proviso and see for ourselves whether after enacting the (saving) clause the Legislature has by this proviso ruled that retrospective operation is to be given to the provision relating to the fees chargeable under the AH. Then it is said that there can be no proviso to a proviso and the second proviso must, therefore, be read as applicable only to the provision contained in Sub-section (1) which is the repeal clause. Now if we try to read the second proviso only with the repeal clause in Section 49(1), it will not give any complete meaning. Of course, as we have already said, we have to read the second proviso with all that has gone before-, including Subsection (1 which is the repeal clause. Another argument of Mr. Mehta on this aspect of the matter is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 08. In his judgment in that case the learned Judge, while examining the argument urged before him by the learned Advocate-General, discountenanced the contention that there could be an exception to an exception. The learned Judge has also expressed the view that to read the second proviso as anything more than one inserted ex abundant cautela would create inconsistency between the first and the second proviso and would render the first proviso nugatory. With respect, we are unable to agree with him. 19. We need not rehearse what we have already stated. It is to be presumed that the legislature has not 'used any useless clause of words. It is a dangerous practice to base the construction and effect of a section upon only a part of it, since one portion may he qualified by other portions. As a rule the Court has to Consider every provision in the light of the general purpose and object of the enactment. The Legislative intent, as has so often been observed, is apt to be lost where a phrase, sentence or clause in a section is rejected. The omission may easily lead to an idea quite different from the one actually intended and expressed. We must not read the clauses in Section 49 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in enacting that the Commissioner of Income Tax should not be under an obligation to pay court fees, when he prefers an application under Section 66(2) to the High Court. The object of the levy of court fees, it is urged, is administration of justice and the argument of the other side that there is no nexus is unsound. Counsel also referred us to Article 285 of the Constitution. Reference to that Article was for the purpose of showing that the Constitution itself recognises exemption in favour of the Union of the taxation by the State. In our opinion, there is considerable force in these arguments. 22. The ambit and operation of Article 14 of the Constitution has been explained by the Supreme Court in a series of cases and we do not intend to burden this judgment with reference to those decisions. It is now firmly established law that in order to pass the test of permissible classification, two conditions must be fulfilled, viz., one, that the classification must be founded on sea intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group, and two, that that differentia must have a rational relation to the object ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s persons similarly situated. The argument on behalf of the State under this head is that the relief in the two cases is not the same. Whereas the granting or not granting of any relief under Article 226 or Section 45 of the Specific Relief Act is discretionary to the Court, the position in the case of an application under Section 66(2) of the Income Tax Act is quite different, though the Court under Section 66(2) acts in an advisory jurisdiction. In our opinion, there is force in this argument. The jurisdictions would be different and the nature of the reliefs claimed in the two cases is also different, The fact that the effect of the remedy may be the same is not a determinative consideration. For these reasons, the present contention urged on behalf of the petitioner must be repelled. 24. There remains for consideration one more contention urged before us by counsel for the petitioner. In the petition, the petitioner has contended that in any event, on a proper interpretation of entry 16 in the first Schedule the amount of ad valorem court fees leviable can have reference to the amount of tax in dispute and not to the amount of income on which the tax is assessed. We have alr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is the mode or method of collection and recovery of the amount of tax or fee. If these stages of assessment are borne in mind, it must follow that in the context of entry 16 in the first Schedule to the Court Fees Act of 1959, the word 'assessed must relate to the second stage in an assessment. It is a stage at which the precise amount of the fee is fixed and the amount of assessment is particularised. It cannot have any bearing to the amount of income which is held as chargeable to income tax. 26. It has however been urged by the learned Advocate General that we must give effect to the words amount admitted by the assessee as assessable and the argument is that in the Form-which an assessee has to submit, he does not state the amount of tax which he admits as payable by him to the revenue. It is stressed that the assessable amount has to be worked out after the assessable income is computed. The word assessed' in entry 16, it is urged, must have reference to the-amount of taxable income and not to the amount of tax computed in accordance with the provisions of the Income Tax law, He has drawn our attention to Section 23(1) of the Income Tax Act and some other prov ..... X X X X Extracts X X X X X X X X Extracts X X X X
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