TMI Blog1961 (3) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... e same business. This reference covers income-tax assessments for the years 1946-47, 1949-50, 1950-51 and 1951-52 corresponding to accounting periods beginning with 1st December, 1945, to 30th November, 1946, and similarly 1948-49, 1949-50 and 1950-51. This reference also covers excess profits tax assessment for the chargeable accounting period from 1st December, 1944, to 30th November, 1945, and business profits tax assessments for the chargeable accounting periods from 1st December, 1947, to 30th November, 1948, and 1st December, 1948, to 31st March, 1949. For the earlier assessment years 1947-48 and 1948-49, on a reference to the High Court the following question was restated: Whether, on the facts and circumstances of the case, the collections by the assessee company described in its accounts 'as empty bottle return security deposits' were income assessable under section 10 of the Income-tax Act? The above question was answered by the bench hearing the reference in the affirmative and it was held that the amounts received by the assessee as empty bottles return security deposits were trading receipts and should be treated as such (Punjab Distilling Industries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to be returned in order to entitle the wholesaler to the refund. The additional price of the empty bottles was entered by the assessee company in the general ledger under the heading Empty Bottles Return Security Deposit Account . The price of the bottles received under the buy-back scheme was entered in the assessee's general trading account. The assessee was assessed to income-tax on the balance of the amounts of the additional sums left after the refunds had been made. It was assessed to income-tax, excess profits tax and business profits tax on the same balance. The learned counsel for the department has maintained that the question referred to this court being identical and arising under similar circumstances as in the case of previous reference should be answered in the same manner. We have been taken through the judgment of the Supreme Court referred to above in which the decision of this court was confirmed. The Supreme Court in dismissing the appeal of the assessee laid stress upon three matters: (i)In paragraph 3 of the judgment it was observed [1959] 35 ITR 519 . 522 (SC): It is not disputed that for the accounting periods with which this case is concer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it making quality. Agreeing with the decision of the High Court, it was held that the question framed for decision was rightly answered in the affirmative. The learned counsel for the assessee has maintained that new facts have intervened after 1948 and the considerations governing the decision of the Supreme Court no longer existed. The new considerations were that with effect from 1st April, 1948, the Punjab Liquor Licence Rules were amended. Section 14 of the Punjab Excise Act (1 of 1914) confers upon the Financial Commissioner the power to make rules. In the exercise of this power an amendment was made in these rules. The relevant amendment is reproduced below in extenso: For clause (f) of sub-rule (14) of rule 40 of the said rules, the following shall be substituted, namely:- (f)( i)The licensee shall sell country spirit at such rates as may be fixed from time to time by the Excise and Taxation Commissioner, East Punjab, and endorsed on the licence. (ii)On presentation of any empty excise bottle, the licensee shall pay to the person offering it for sale, five annas and six pies, two annas and six pies, or two annas and three pies for every empty quart, pint o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the security deposited in respect of them. If the bottles returned fell below 90% then the distiller was entitled to confiscate the amount of the security in respect of the number of bottles not returned. The statutory rule entitled the licensed distiller to demand security at the specified rates up to 10% only of the bottles issued by him. If the distiller demanded security in excess of 10% of the bottles issued by him that of course was beyond the permissible limit. The amended rules were given effect from 1st April, 1948. To securities demanded in accordance with the above rules, the three considerations which prevailed with their Lordships of the Supreme Court and which have been mentioned above will not apply to the instant case. It cannot, therefore, be said, as was the case in the appeal before their Lordships of the Supreme Court, that the additional amounts had been taken without Government's sanction and entirely as a condition imposed by the appellant itself for the sale of its liquor . Again it cannot be said that the wholesalers were under no obligation to return the bottles . Lastly, in view of the statutory rule amended in 1948, it cannot be said that the dep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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