TMI Blog2001 (7) TMI 266X X X X Extracts X X X X X X X X Extracts X X X X ..... sion that the individual member's residential portion is uneven and, accordingly, it was an AOP, the shares of whose members are not definite and ascertainable. It was only on paper but not in actuality. He, accordingly, assessed the AOP by applying the provisions of section 167B of the Act at maximum marginal rate. The assessee's claim was that it is an AOP whose shares are specified in the deed itself being 1/5th of the undivided share of each member in the income as well as in the property and the income being income from house property, the provisions of section 26 will apply dealing with the specific case of income from house property and not the provisions of section 167B of the Act, the former being a special provision and is to be given precedence over the latter being a general provision. 3. The CIT(A) after examining the facts of the case and considering the arguments of the assessee advanced before him opined that the conclusions drawn by the Assessing Officer were not reasonable. According to him, the shares in the property was determined and definite and hence section 26 of the Act is to be applied while computing income in this case. He, therefore, directed the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other member of the AOP. It would be their inter se arrangement. In my view, therefore, irrespective of the manner of enjoyment when the rights of the co-owners are equal, then the respective shares of the members are to be taken as definite and ascertainable in view of the Calcutta High Court decision aforesaid. 5. The dispute, however does not end here, There is another provision inserted by way of section 167B introduced in the Act by the Finance Act, 1992 w.e.f. 1-4-1993, whereby an AOP is to be charged to tax at the maximum marginal rate or at the higher rate if any of the members of such association is chargeable at that higher rate. For the sake of brevity it is extracted as under: "167B. (1) Where the individual shares of the members of an association of persons or body of individuals (other than a company or a co operative society or a society registered under the Societies Registration Act, 1860 (21 of 1860) or under any law corresponding, to that Act in force in any part of India) in the whole or any part of the income of such association or body are indeterminate or unknown, tax shall be charged on the total income of the association or body at the maximum margina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han the maximum amount which is not chargeable to tax, the AOP, has to be assessed at the maximum marginal rate. Apparently, this section also applies in the present case. 6. in view of the aforesaid reading of the provisions of sections 26 167B, we are landed in a situation where both the provisions are applicable and neither is excluding the applicability of the other. To solve such a conflict, one has to resort to interpretation of law and the famous dictum is where there is a general provision which, if applied in its entirety, would neutralize a special provision dealing with the same subject-matter, the special provision must be read as a proviso to the general provision and the general provision, insofar as it is inconsistent with the special provisions, must be deemed not to apply. Sir George Jessel, M.R. in Taylor v. Oldhan Corpn. 14 Ch. D. 395,410. General provision must give way to the special provision. 7. Generalibus Specialia Non Derogant is the leading maxim and it means that general things will not derogate from special things. In other words, it is also explained as Generalibus Specialia Derogant, which means a special provision normally excludes other oper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereunder the Department claimed by exercising the right under section 49E of the Indian Income-tax Act, 1922 priority over the other unsecured creditors, whereas sections 228 and 229 of the Companies Act, 1913 provided that an unsecured creditor, must prove his debts and all unsecured debts are to be paid paripassu. In that context, their Lordships of Supreme Court observed that there was an apparent conflict between two independent provisions of law and in such a situation it was held that special provision must prevail. It was held that section 49E of 1922 Act was a general provision applicable to all assessees and in all circumstances, whereas sections 228 and 229 of the Companies Act, 1913 dealt with the proof of debts and their payment in liquidation and it was reconciled by stating that section 49E applies when insolvency rules do not apply. 10. It is, however to be remembered that this rule of construction is not of universal application. It is subject to the condition that there is nothing in the general provision, expressed or implied, indicating an intention to the contrary. This is the rule of Statute by Maxwell on the Interpretation of Statutes, 11th Edition, at page ..... X X X X Extracts X X X X X X X X Extracts X X X X
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