Commissioner Of Income-Tax, Madhya Pradesh v. M/S. Binodiram Balchand, Lndore

MARC BAIA, ACT Gea aaa faatdtcra ataaraz, grate(Commissioner of Income Tax, Madhya Pradesh M/s. Binodiram Balchand, Indore)(16 faaraz, 1969) (Fato Ho At WME AIT Fo Tao Fz) qe ‘at’ taza (cata BATA) ATE, 1950TT3(v),.4,5, 6, 11 ate 12—frat ferg fanaa sera (faatfeat) atwt fe art ‘a’ wea 8 faaat at, wasatal A ala at seaalat—1947-48 aw faatfeal aver staat & faaten F galwayanfad faatet ag at gt gaaat aq atar sat, farq 1950-51ata fasta ag & facia ag at gaat ag atat aTaT aT ‘a’,zwisa A tfasatpa Brea araiat aia at feat saa S wetfeqtaal ztwiqanr We afaart Hl ATTA HA |r erat feataiat—faatfzal facia ag at gaaa qaaat ag & eG A ATAHT FHA F AAT TART ATAU ATT AT alas F Gageal F weatyafearaatexta, araaeateoafaateat amarat alrattac| fratfedtua ferg afawaa Hera at; TAHT HeaTaT gral< F ATare yaqa ‘a’ usal Fe fest F fay wea area Tse AT aT, Wacarat 7X atare off| saat are H aaH ala A fray a yaeg aTaataa aie weafral car wat ABac wt ara A11947-48 aterfaatcr ag an faaifedt & ara & saeas M gaadt ag aTaTaTattat, ag ‘@’ aafaa H tfaedtad faareit Head at at & | 1948-49 arate ara are wer fearett ge agfHeeq & ata a BT sae TH“om sat ara & Brey gar at Ht aT aH’ UST A Maye BT A1950-51alafaaicrag ®favfaaifedd & aeerat farfe ardsara ate faa afew a aaa Fate We 734seqay eargiaa fara fsa art Saal ae F rare F, saat gaadt ag ag ag at wt fH 31 art1950 ST aara_gar arate ag fee ergata orca arate ara FH araees Fae A eeza (daaara eraora) wet [are ‘a’ tse (TATA araedtfeared) area] 1950 % sree ary ate F Ta ag wt eet A ry fs1948 ate Hest ag H tua Ba at HAtaaT MeysT gat ar, Ta IXat ag amar at anat1feeq sane afeard, aga aga(adie) aat acter afar a a feet Aat ga acta al ga arazqt eatare vet fear fe fratiedt at armeat sew caq baz, 1922 atare 2(11) (i) (t) % oegqa & soarah F aeata arate Ate satale ag qaadl ay F ale Wt ofeada adl at amar) wa: ag Fraterfrat ver fx fears ar ad aT 2 TaFax, 1948 F 21 waqax, 1949 atTAT FAT AL, HATS TaT-ay Bi yeHA See dae 1922 HT are 66(1)a aeatet fay ay freer & sea str ge sea eararaa 4 ae afafaaifeafeat fe saea-afancr at faaefreer fase ar ® ata &arary F qaadt ag ag facia agg aT fe 31Ard, 1950 at aaaelat € dat wsaa alae He Fer12 %mda wauda aaa srWIAA BU FH ala, Ha aT A arfaa argo awit aa we aT WAHeaaa gia, ag wea A fafea fearadt ex ae dea Aat we zaH Taraat fe faatfedt ecg araia oe ga mie Fafafearadl-ez axafant at aay ew ® afaeardla f1vat fasta & faes araaxgad T TAMITT HHT SeaaT MATH atta Bea BTSs 1 adheaT HF Ty,afafaatita—agaaa gaadt at a of farsifeat at, ag em areaar fratat ari seat ara, gad awe a Regarea FH Migyaar wqyage at1 wa: fraifedt area FFU 5, 6, 11yTTey (1), 12 ak13 BT Haar act HLTA HT BHAT SL (TUT) a wna Ho geanat aie araia wae faa sa aradtFX dedfear at; saat dara aq’ usa F cfaedtad teal aeadt + frat at frayMase WM afaHrt F gare J aa fara HE at usa-fafe aa At 1 araH<faata a ga araeer F Hs at faare ad} soraté fe arate ara ozafaat aaa aT amat ge sa TT BTS AY ara sanacila ae@1 wea eatF sat ga frome F fees MG aA afeaewal feat 3fe ag araie are area F Te 12 at afefe H Haz art 21 afe ag ara ara aft ardt @, aT adader 6 Hl Baa gu gat aE wh azzwet ¢ fa ga wea ae area at age F fafa feotadt ax a afraxS{AET HVAT TST1 (TT 12)_ area & zr 3(v), 6 Mt 12 a area get a wy fafaaadl & 7@ 9g ¢ fs fralfedt arte at agg & afre et BaraatBT aary Her H arfaeareter So ae GAH TaAT ae sa aaa a TATAHafma ect argo arate aa oe afeee ar dare wet H aftarfaeateta &1 (Fe 13) fatacz fruig [1969]1969 at fafaa atta dear 19 fast fafreaa 16 feataz, 1969 at fear qatar| —ATTRL gaa,AeA wae aaa Haaars :(Income-taxCommissioner,Madhya Pradesh Vs. Kanchanbai). fafaa aie afeatizat: 1969 a fafaa adie deat 27. 1958 & sate fafar urcar dear 281 H meq yea yeaTqIaTay F ATMA 28 agar, 1960 ara facia wtx maa Hfacesal 1s ait|| agtarat at are aWaAl UTo Ho Feat Wit alo St Al seat at wT aaaa; THo Flo STAT, WATT~ ATA, AT TWIT MIT cqsla Arar 328 COMMISSIONER OF INCOME·TAX, MADHYA PRADESH MIS. BINODIRAM BALCHAND, lNDORE December 16, 1969 (J. C. SHAH AND K. S. HEGDE, JJ .] (Tct.x,ation ConcesJious) Order, 1950. lnco111e-tax-PC1rt B States (Tct.x,ation ConcesJious) Order, 1950. pcirar, 3(v), 4. 5. 6. 11 coul l2-Di1'idend inco111e, receii·ed h.r as.~'esseL< " resident of Pctrt B State-/11co111e-tax and super fllX payah/e by ns.res.\'ee. · Previous yeC1r-Rigl11 of tl.'isessee of change. The assessee was a Hindu undivided family with its head office in tr Part B State with several sources of income including managing agency commission and shares in companies and firms. Till the assessment year 1947-48 the previous year adopted by the assessec \\-'as the appropriate Diwali year. Du'ring the Diwali year 1948-49 it derived dividend income · from a company registered in a Part B State. A part of the income. however, was attributable to the profits that accrued to the company in a P".trt A State. For the assessment year l 9S0~5 l the assessec claimc<l that in respect of its income by "''ay of commission from the managing and selling agency of the company, its· •previous year' was the one ending on ~larch 3l, 1950 and that in respect of the dividend income received from the company-the provisions of Part B States (Taxation ConccssionsJ Order, 1950. were applicable to it. HELD : ( J ) The asscssee was entitled to take the financial year as the relevant previous year.- [330 F-G] C.l.T .. M.P. v. Kcmclwnhni, C.A. No. 19."69 dt. 16-12-1969, followed. '_2) As the asscssee. in the relevant previous year. was a resident of a P<.1rt B State, under paragraph 4 oflhe- O'rder, the assessce was entitled ·to the benefit of paragraphs 5, 6. 11( 11. 12 and 13 of the Order. Since the relevant income was dividend income. paragraph~ 6 and 12 of the Order were applicable and the income-tax and super-tax payable hy the <isscssee had to be computed on the basis of the formulae given in pa,1'a-graph 6 read with the Explunation to paragraph 3(vl of the Orde!. So computed, so far as income tax is concerned, that part of the <l1y1den<l income attributable to profits accuring in the .Part A State \\'·as sub1ect to incon1e-tax onh• lit the concc.n·ional rarf!.\· prescribed in the Order. ao<l so f;ir :.is the supfr tax is concerned the l!ntirc dividend incon1c v.'<is subject :. to ).Uper tax llf the co11ce.n·ional rafe.\' mentioned in the Order. f.13 I F: 332 E: 333 A-CJ CIVIL APPELLATE JuR1so1cT10~ ~. Civil Appeal No. 27 of 1969. Appeal from the judgment and order dated October 2&. 1960 of the Madhya Pradesh High Court in Misc. Civil Case No. 281 of 1958. . . S. K. Aiyar and B. D. Sharma, for the appellant. M. C. Chagla, Rameshwar Nath. Mahinder Narain. and Swuranjit Sodhi, for the respondent. t t- · c.i:T. v: BINODIRAM (Hegde, I.) 329 ,-, Hegde, -The JudgTI1ent J. In this appeal by certificate brought by· the -of ~ the Court was delivered by . Com~ missioner of Income Tax, Nagpur,'· two questions arise for con-sideration. They are,:. · -· ., · · ( 1) What· is. the "previous year·· in r~spect of ;the source of inco~!_e, viz. man'!g!rtg agcricy and~ selling ag(!ncy _ and financing of the Binod Mills Limited, Ujjain for the purpose of assessment for the assessment year\ 1950-51-whether· the year· ended 31-3-1950 or Jhe ,year ended Diwali, 1949 '? and (2} Whether for the purpose ~of· bringing to tax the dividend .income of the assessee for the assessinei:tt year · 1950-51 and having regard to Ihe provisions of Pan B !>tates (Taxation Concessions) Order, 1950 (in short 'Order'), the dividend income say of Rs. 34,468 (gross Rs. 50,137·) as well as the dividend income of Rs. 2,28,392 should be subjected io tax at the concessional rates mentioned in the Schedule ' to the 'Order' as held by 'the High Court .. , -- rarataa at favig eararfaafas Ho Wao BTSs F fear|| sorarfarta g1s3— aa adie & feet age H araHt aged A TATA HHT Aer ay, faare fay ort & faa at set sett gu @, a wer aE: (1)1950-51 at# fratzy ag & far frat & sataarassaq fea fade face fafats % saa gfaacr ai fanafuaen att fadtarwn, aa Rata Bara HR “qdadf ag? PAA J—AE TT ST fa 31-3-1950 HT Aa gat aay agag ai fe 1959 at fearey & fea gare Sal at; AIz (2) ag fe aar ae amt & gators & fre 1950-5 ate |frateo ag & faq fraifedt at arate ara ae at aay cat% fae dat [aie dhe ee (eater Heda) asx] TT ae’ UT(Hurargt ata farsa) azar 1950(fae date H grea zeeTaf) F Sosa HT eats waa SU 34,468 waa at areata aa_(WHT TT 50127 wT) Tat aria 2, 28, 392/-eat Ft avatar’*ma I, far fe seq eqrarag & ofafraifea feat ar, ara atmaga 4 afore faraat ex oe ee aaa aTaT anf@ Tat Haga2. fratfeat @ Usa feng He afaraaa feed Hera FH fae g ate wer gaat area qeqrag usa at sit oat &aaa earat H are 2 4 waH atat a fa fe arcfe, arcarz, saraafaar silat arterd aif H Rac anfe 8 ast ara year aedat | ait aaa Praia ar gare arag Harare waar ar Aeafaataia fee afanaa pera at tfaad F vaar feat feat qatut| fae Brag H Gea TT HIRAI AT, ae 1945 F feet qua are HTfeat Tat AIX 1948-49 WX1949-50 ag % fav yaar Frater adifeat Tat| 1947-48 ata fasteo ag an, fraifedt a at ‘qaqa ay”attATTA a, 4g feared F sreeT ga ara aafaa ay ar1 1950-51 frater ag & fae faaifedt & ag arar fear fe eeda feaafaata face fafats & sara att faa ofrecer ® arta } ate aeTt at areil aeyeaa He gear “qdadt agter agawtfe= *31 HIM, 1950 at ware star f We Saw rare Te Gar ae atafe 1948 ay Hast ay H aera sa wy acta Wey gat at, veTe HL et AAT ST AHA| aTTHT afsaTA, AeTTH aTAaT (AAI)att ater afaaer + ea celles at etary vat fear) gaat ae aaat fa fraifedt at arrar seam daq waz,1922(faa daa F daewel Tar s) HY ae 2(11) (i) (c) ¥ awaH ¥ scat F gaiaATA {| SAH Haare, Zhe fraifedt ar we are Frater fear aT“ALMarg, gata sa ag afsare orca aad & fe ag “qdadt ad” FEafta etca frond ar eat gu ga arart at fate fear aafa feat ar ad a) fe 2 aarax, 1948& area gar ar ate y|;4 —;oytov{ The assessee ·is a Hindu. Undivided Family. with its Head-office ·at Indore and _branches at several o<l1er. places· in some of the -former B States including the State of Madhya ~harat. II derived its income from several sources such as property, busi-nesses, managing· agency. commission,' shares' in' partnership firms, . etc. The assessce's fam.ily .at one time was carrying on business -at Bombay and was assessed in the status of non-resident . Hindu Undivided Family. Its business in Bombay was, however, closed down sometime in 1945 and no assessment' was made on it for the year 1948-49 and 1949-50. ·Till the,assessment year,1947-48, the "previous year .... adop;ed by the assessee was the appropriate . Diwali year. ·For the· as,essment year 1950-51, the assessee . claimed that in respect of its income by way of commission from the managing and selling agency of the Binod Mills Ltd., Ujjain its "previous year'' was one ending on March 31, 1950 and on that basis it contended that the commission accrued to it during . the calendar year 1948 could not be brought to tax. This con-. tention was not accepted by the Income Tax Officer, the Appel-late Assistant Commissioner and· the Appellate Tribunal. They . took the view that the case of the assessee is covered· by the pro-viso to s.-2(11 )(i)(a} of the Income-Tax Act, 1922 (in short "the Act"}. According to their view, the assesscc had ''once been assessed". · Therefore it was not open to it to vary its "previous vear". In. view of that finding, the .assessee was assessed on the basis that the Diwali year be)!inning from 2nd November, 1948 and ending on October 21, 1949 is the relevant account year. In that account year, the assessee derived. net dividend _income of Rs. 2,62,860 from the Binod Mills Ltd.,-ujjain. Out of this income Rs.· 34,468 were .attributable. to. the profits that accrued or that could be. d~emed to have been accrued to the Binod Mills in Part A State,. But the remaining amount of Rs. 2,28,392 was held to be attributable to profit~ which accrued in Pa11 B Stato l'iz. Madhya Bharat. As the dividend income attributabic to profits accruing in ·Part A State was subject to tax under the Act. the Income Tax 9ffict;r grossed up lhe net dividend of Rs. 34,468 to Rs. 50,137 under s. 16(2) of the Act. This income was sub-jected to income tax and super-tax at the rate; prescribed by the Finance Act, 1950, rejecting the claim of the assessee for conces· ~ion in, regard to this income under the 'Order'. The balance ol' Rs. 2,28,39,2 was not subjected to an} income-tax in view of the provisions cpntained in paragruph 12 of the 'Order'. It was, however, subjected to super-tax at the concessional rates men-tioned in the 'Order". The Tribunal rejected the contention of the assessee that the dividend income of Rs. 2.28,392 was not subject (o super-tax under paragraph 12 of tbe ·'Order' and thal the amount of Rs. 2.62.860 should not liave been apportioned as the Income-Tax Officer had done as neither income-tax nor supcr-tax was lcviable on those profits and in any cDse, super-tax was payable on the entire dividend income, 011ly at the concessional 'rates'. On a reference made unde1· s. 66( I) of the Act, the High Court held that the "previous year" in respect of the manag-ing agency and selling agency sources of income is the financial year ending March 31. 1950. With regard to the other question, the High Court held that the income-tax payable on the entire dividend income included in the total income' after exclusion of the non-taxable dividend under paragraph I 2 of the 'Order' would be at the concessional rates prescribed in the 'Order' and further that the assessee is liable to pay super-tax at the concessional rates mentioned in that 'Order' on the entire dividend income. Hence this appeal. y|;4 21 waqay, 1949 FY TAT EAT MT FATT Saat F va Aar-ay Ffraifed) % assta feaa fate face fafaes & 2,62,860 eat at YaAAT AT Wea BY “MTA A A 34.468 way at wea sa art Fafurraeaeq sca ee at ay fH fate face ay art w usa F yqaTgu & ar fart at Hag aaa aT awa at fe & vaH wey ex% freq 2,28,392 wa at Ae tHe H attHag afafraifea feat aaray fe ag wea sa oral H aftormeateqsiete gg at at fH art ‘a”use wa AeA aa H Maya gs at ae wer we UST a Teyata arr aral & afeqraeaer Tea aA AIT IT Uae HMA HTATTA TT aHAT at, gafeae arrat afrara ¥ Rae as aver 6(2) ¥matt 34,468 way al Te aA Bl Aart HH 50,137 waa TATfew| sa ara ot faa atafaare 1950 ara fafga et at arTaAT AITafract waar var car fratfeddarea ae wel ge ae Fh dae Ffeaiaa sieq Het FH faw at arar feat at sa wediaa wxfear wartmaa eeu 12H weafaer soda st Far gu2,28,392 way FeTHF GT wat ae way aT| Peg meee afr fearadt exeafaat aaa Tar| afeHcoy & fraifedt ey ea aeiler HT Wedlare HTfat fr 2, 28, 392 wad at arate aia at wae RH Fer 12 ¥ aterafaat aét aaa wat at WIT agfH2,62,860 wat at tea ar garert sat ware & adh feat arar arfad aa fe atanxafeardt +frat at, adifs ga arat ot a ay arant ate at et oafsax sanenttear ate fret at feafe Farge araie ara ae fearadt ext at dtafanx dea ar| Vaz wy aver 66(1) % ate fae ae fades oreerala ot sea eararag 4 ae afafaaifes fear fe caer afaacor atefasa afuacor faran ores aldt & araea H gaad? ay ag fadiaag @ ot fe 31 ard, 1950 at aarea Slat S1 Fat Met H Aaa F oTararaa a ag ufafreifes fear fe areater 12% wet patATATT BT TATA HA FB are, Ha aA A faa arqa araia wgqt Ht MAH Hag Vr, ag alae a fated fraradt et ot Wea starait Fan Taal ae fe fratfedt aequ arate qt ga wea A aforefraradt at oe afant Hr ara Het B arfacaresta=F1 Wa: we attrer TSI- «= -Saat rarataa facia afxat = [1974] 3gH fo qo 3. wat aH fe Tet set BT aaa gs aalq ag fe zat frettedfacia ad at gdaa gdadt ageTHF aaa ar EwartaT, aeMAHC MTA, ACTAAA FTA Had ag sta arma A fac agfafteqa artr aad at wale fra gua wa fear gi sat gaa aTare aay g, SAH A aTIT IT ga Aaa H ada Fo gea aaragy aToy fafaeaa &, saat gtse at arat &1 4. ma gH satu a faa wear wet gala ag fe aafasifcat at araier are at fate area at agaal a fratfta at 7z,araat gar afaat F vated % fre feat ara afar| 5. goa arog & ga fangfaces fe faaifeat at wea wireHa araty ama Mayr ge at arse orca ge tt, va oe afaaxAMAT HAT alfa aat sas sa fracas & fawg fe arate ara F usMIT It aaat ata oat atfar, aire adh at ag atwa: aeqian adi 2 fe ge va sea at faare wegafaa cde & fac| Sit aet aa tear %, ag ae 2 fe ear sea eqrataa at ag afafasiferawa saat fe aaa art It Tt aaaat ufant vangula @,qa ag wie AF afoa fearadl ax oe Sauget Fi 6. zt ara Tt catafeat at anat & fe aeq staal aya,1950 am ste te usa-fate wel at ot fa ara ate afergata ddfaa atarea F Fw 3(5) F CET Bt Us av”afyeatad at afore at 7s 21 sa ohare H eqectawy A ag vatafeat qa é: |*eset fe array at ufaat HF sue a aafaa Be atusa-fafa adl at, aati sa faaa fer (ature area F ava,1950 & sau fet)get ga va usa A yaa ataart ak *aqa Faz ea THTT F— “Where there was no State law relating to charge ofincome-tax and super-tax, the rates of income tax and super-tax in forcein that State immediately before the appointedday (in the present case Ist day of April, 1950),shall for the1 1969 at fafaa ata deat 19, faaar fafaraa 16 fearaz,1969 at fear7TaT aT|.- AIH MATA To faarat cra [ato ans] afaat at attarth ga aus FH satral & fac ag aaasrgat fe & arqyat H fafafece ate 1” qu 4(1) Hag sade feat mars fe ca arta ® dcr 5, 6, dail & sT-Fu (1), 12 gag... So far as the fiN question is concerned viz. wh~her the ""essee was. entitled t•1 take the financial year as the relevant previous year, the same is concluded by our decision in Commis-sioner of Income Tax, Mndhya Prade.1h v. Kauchanbai (Civil Appeal No. 19. of 1969), just now delivered. For the reasons mentioned therein the decision of the High Court on this point is confirmed. This takes us to the second question namely whether the dividend income of the assessec should have been assessed both for the purpose of income-tax as well as super-tax at the rates prescribed in the Schedule to the 'Order'. The High Court's finding that the dividend income accrued or received by the assessee in Madliya Bharat is subject to super-tax as well as its finding that a pllrt of dividend income is sub-ject to income-tax had not been appealed against. Hence it Hence it is A not necessary to go into that question. Therefore the question that remains for examination is whether the High Court was right in holding that the income-tax and super-tax leviable on the dividend income is at the concessional rates mentioned in the Order'. B It may be noted that in Madhya Bharat till April 1, 1950. there was no state law relating to the charge of income-ta." and ;uper-tax. Paragraph 3(v) of the 'Order' defines the expression "State rate of tax". The explanation to that definition says "Where there was no State law relating to charge of income-tax and ,uper-tax, the rates of income-tax and super-tax in force .in that c State immediately before the appointed day (in the present case 1 st day of April, 19 50), shall, for the purposes of this clause, be deemed to be the rates specified in the Schedule". Paragraph 4(i) says that the provisions of paragraphs 5, 6, sub-paragrnph I 1 ) of paragraph 11, 12 and 13 of this Order shall apply .... " (iii) in the case of any other assessee who is not D resident in the previous year in the taxable territories or in the taxable territories other than Part B States, to so much of the income, profits and gains included in his total income as accrue or arise in any Part B State and are not deemed to accrue or arise, or are not received or deemed to be received within the meaning of clause E (a) of sub-section (I) of section 4 of the Act, in the taxable territories other than the Part B States." The assessee in the relevant "previous year" was a resident of 1\fadhya Bharat. His income with which we are ~oncerned in thi; appeal exclusively accrued or arose in Madhya Bharat. Therc.f r for~ the assessee is entitled to the benefit of paragraphs, 5. 6~ >lib-paragraph ( 1 ) of paragraph 11, 12 and 13 of the 'Order'. Paragraph 5 deals with the income of a "previous year" chargeable in the Part B State in 1949-50. The assessee's case does not fall within its scope. Paragraph 6 deals with income of a "previous year" which'docs not fall under paragraph 5. That G paragraph to the extent it is material for our present purpose reads : "The income, profits and gains of any previous year ending after the 31st day of March, 1949, which does not fall within paragraph 5 of this order shall be H assessed under the Act for the year ending on the 31st day·of March, 1951 or on the 31st day of March, 1952. as the case may be, and the tax nayable theroon shall be determined as hereunder : In respect of so much of the income, protits and gains included in the total income as accrue 0r arise in any State other than the States of Patiala and East Punjab States Union and Travancore Cochin- (i) the tax shall be computed (a) at the Indian rate of tax and (b) at the State rate of tax in force imme-diately before the appointed day; (ii) where the amount of tax computed under sub-clause (a) of clause ( i) exceeds the tax computed under amount of tax computed under sub-clause (b) of clause ( i), the amount of the first mentioned tax shall be the tax payable; (iii) where the amount of tax computed under sub- *« (iii) feat te ag faaifedt at cara ot fe aaaafeetat Far wm ‘a’ usal& fara wera ofeetal & qdadf atH frarat at &, sat ara, saat ger arr & fafenfra avait sitare afwarat at ary att fara far frat arr ‘a’ tea H steyaa sayd gee ate sah at A waa ‘a usa afr audcfetat H, afafraa at ara4 at sqare (1) * aque (aw) &materia ag agt ear sat ¢ fH Maya at sqya gU & ar agfe| oiet ret gu sg ar siet BU wat was aT F 1” .7, yara gaat ad F ot faaifedt ot, ag wer area ar fratetaT1 saat ara, faad fe ga adie & gara dae 2, qa awe a aeara ¥ iteqa at vequa gf ataa: fraifedt ae ® Fa 5, 6,11SIT (1), 12 We 13 Bl HAST sTeT HLA HT sHarr z| 8. Furs % 1949-50 Hart‘@’ useFH ows qdadt ag atara % art Haar fear war 21 fraifedt ar ataar saat ofefx &waz al MAT J1 FAT 6 F VS Gaadl ay Ht ar F araeg F soda fagat mar 2, sitfis Gers & ata vat art 21 faa fe aa de purposes of this clause, be deemed to be the rates specified in‘tthe Schedule.” *“(iii) in the case of any other assessee who is notresident in the previous year in the taxableterritories or inthe taxable territories other than Part B States, to so much ofthe income, profits and gains included inhis total income asaccrue or arisein any Part B State and are not deemedtoaccrue Or arise, or are not received or deemed to be receivedwithin the meaningofclause(a)ofsub-section(1)ofSection 4 of the Act, in the taxable territories other than thepart B States.”. 740geaan wararay fora ofa[1974] 3 BAe fro To emt ada waisa H fag aera g, saa ag farafafaad ey a,aa|; 03) ard, 1949 8 are garca gtt ara feet qaadl aeat aia, ara aie ufwara at frater at fe ge area F ATT 5& qeata vat 3, aarfeafa 31 ara,1951 at at 31 ara, 1952al aaa ala ara ay & fey tae F aes fear area alt sarqt daa Hr gah AA fer ae ea F fafea fear aTAT| aa, at aaa afeafaa art ate afar HIT,arger HX feaar ofeatar ait gat ora wer ae ae aTaTAT-alata & creat & fuer feat cisa A MeqT ar saaT sat F—j (i) etal aaoar (w) ee at weds at a ate(a) fara far ® Tea ge sa He FUT aT Taarea; (ii) wet fe aus (i) # save (w) Faealaanima at at wer at fa ave(i) ® stave (a)e atta ania ae a ofa stat 2, gat san afd FTBY THA TAT HT SAT;| Hag ga TET a ga TET a TET a a“The income,profits and gains of any previous yearending after the 31st day of March,1949, which does notfall within paragraph 5 of this order shall be assessed underthe Act for the year ending on the 31st day of March,1951or on the 31st day of March, 1952, as the case may be, and:the tax payable thereon shall be determined as hereunder : *sigalt Hag ga TET a ga TET a TET a a “ic¥iaco,AL 7; In respect of so much of the income,profits andgains.included in the total income as accrue or arise in any Stateother than theStates of Patiala and East PunjabStates.Union and Travancore Cochin— ;(i) the taxshall be computed (a)at the Indianrate of tax and (b) at the State rate of tax in forceimmediately before the appointed day; (ii) where the amount of tax computed undersub-clause (a) of clause (i) exceeds the tax computedunder sub-clause (b) of clause (i) the amouut of the firstmentioned tax shall be the tax payable; wf . (iii) azt fe avs(i) * sravs(#) F gelaanfrt Ht st weq que (i)F yrqes (a) -F gelaaaina at & ofan alt 2, sat afas we a can-atoaata a fae & eo FT aaera fear are ate saH aforeHC A Gad THA at fe sa gHT a HA se aay gy,aq Hr getty 1” 9. sad & regan gat ada sata H fae gard wat gt Gz 3(5) & eqedtacr & ara oft FIG H aus (i) J sar(iii) at aa gu fasifedt gra aaa ax, aeat car afaat atATA ga BTA RH Brae ge HoT sat & at fe Tey 6 A fear gar&: gat wedi ad faaten, ara at agg Fafa fearadl ex aHTT ISAT|: 10. aida & Fur 12 F araial & art a gaara fHat vat %, ag.|Za WHIT AS: clause (a) of clause (i) exceeds the tax computed under sub-clause (b) of clause (i) the excess shall be allowed as a rebate from the first-mentioned tax and the amount of the first-mentioned tax as so reduced shall be the tax payable." . The provisos to that paragraph are not relevant for our present purpose. In view of clauses I to :l of paragraph 6 read with explanation to paragraph 3 ( v), the tax payable by the assessee, income-tax as well as super-tax has to be computed on the basis of the for-mulae given in paragraph 6. In other words, the assessment will have to be made at the concessional rate mentioned in the Schedule to the 'Order'. Parngraph 12 of the Order deals with dividends. It reads : "Where the total income of an assessee chargeable to tax for the assessment for the year ending on. the 31st day of March, 1951, includes any income from divi-dends paid by a company registered in a State in which there was no State law relating to the charge of income-tax and super-tax and the dividend is paid out of pro-fits which were not liable to be taxed, in whole or in part, either in the State or in the taxable territories, no income-tax shall be payable by the assessee on such pr'Jportion of the dividend as the non-taxable profits of the company arising .in the State bear to the total in-come of the company." The income with which we are concerned in this case is dividend income. It was paid by a company registered in a 'B' State in which there was no state law relating to the charge of C'.l.T, V. BINODIRAM (Hegde, J.) income-tax and super-tax. The department does not dispute that the dividend income of Rs. 2,28,392 .is only subject to super-tax and no income-tax is leviable thereon. In other words it does not contest the finding that that dividend income falls within the scope of paragraph 12 of the ·Order'. Once that is conced~d. as has been done, then there can be no doubt, in view of parn-B graph 6 of the 'Order' that on :hat amount super-tax has to be levied only at the concessional rate prescribed in the Schedule to the 'Order'. Reading paragraph 3(vJ, 6 and 12 together, the position that emerges is that the assessee is liable to pay income-tax on Rs. 50,137 at the rates mentioned in the Schedule to the 'Order' c and further he is also liable to pay super-tax on the entire diyidend income at the rates mentioned in the Schedule to that 'Order·. For the reasons mentioned above. the view taken by the High Court is correct. Hence this appeal fails and the same is dis-missed with costs. Appeal di;mhsed. V.P.S. ‘sai fr 31 at, 1951 AT aarca aA area aT F fayfrat azfar sara fastfedt at ge ore F eats Caaruiat & sea ats ata arat 2 faa va usa A cfredetmead+ daze feat et faad fe araec ar afare Fm aarafeaa arg dt usa fafa aval at aie arate oa arat a adaa feat srat & fr gear at wer Hat wade oferat a (iii) where the amount of tax computed undersub-clause (a) of clause (i) exceeds the tax computed_.under sub-clause (b) of clause (i) the excess shall beallowed as a rebate fromthefirst-mentioned tax andthe amountof thefirst-mentioned tax as so reducedshall be the tax payable’’.; ra: aT wlTa: HIE AT HT al Aaa GT Twat a, sat Praifedtaratefe F GIA agaat aE ot aaee dae aat wea faa tea Haar alt ara aredt & aga art F weal ayHat as satay sg”|. 12. ga amet & fra arr F sare araea e ag arate wa ztva seat at aaa fear arj saat dare ‘a’ usa F vfeettea teteect at fear ar frat araae ate afsatFR uic a arafag AEaT usa-fafr avai ati fear & ga araea F ats wh faare ae} vorar@ fa 2,28,392 wat at arate ara ae afaat aatat ar axat 2 WITSa TT HQ AT aIaHL Vanes aélJ1 Bea geal H saa ca fang& fave arg wt ofzare weal fear 2 fe ag araia ora mea & Fer 12at afta & vax art¢1afe ag ara ara aft ardt 3,star fe setqt fart qat g, at are HTT 6 HY Baa zu zat ats A ade adh@ fe va wea at mea at agaqdt F fatga feoradt ax 8 afsaxSEEN BAT TSA 13. G21 3(v), 6 ae 12 HT aTa-aTa ea a AT feafa aadt 2,ag ae @ fe faaifedt arta at ages Hata ec 850,137AAG Bi Tala BUT H arfaearela J ate saw eal ae va areaal ugaal a aire et Farge arate ae 9¢ afaax aT aaa HW& Wt arfacarta Z1 14. sogad HITT A sea eaaTaaT