Maharana Mills Pvt. Ltd v. Income Tax Tribunal, Ahmedabad & Ors

[1990] 1 BAe fto To 621 aero face oto fafaes TATA aay aftata, agaarata alt aq 3 WE, 1989| qea raranfa ato ume Tam site emtaRia Tro TAo arf dfeaa gamn-zea Qaz, 1922—arer 10(5) ate o¢-u [agafer faaarfafaan, 1950 #t aret 12 ate 13 aut zadare ait (ae ato eeaar) (feqaatare feataedta) avsz, 1950 % as (2) ar easdtaen vs aE FATA eaeaifsia|—aafafaa dem H vaya fears— ga aa H agara aaeram ata agrat a ter ad A afer aaa ale F HT TT Hfsars CACETHTTsen & gc at n§—saet as (2) HF ge careat eaedtre fates at| |gaara ain (we at ceca) (fran ate feataedia) st, 1950—1956 ¥ sitet wat @e (2) wT emer —saa eaedteen Ft atheaTET TTaqatat—aare arer attest ar watt BUA B Bfomts SeAT eat afar §—sadVBSTHTN HSH Hoare Fe BTAaT faterAtey aT | gataae Sea, 1966 AST 7, SA 2— FRA raTaHs Tt faTTHAata —arita 8 afaera carats & fafaraa at aeretar & art 8 aag—afaara euradts & fafasaa at aga at frare Hea StH Tatstat— afar aSfafiona & stadia area % ga: a Aa Bt Saat —_gar saragts Ft aterwet fader wea & FHL FRAT TAT || ate. faafrart-farifed, at fe % fear dredat araa ca ear srgae fafats oe eaaerga aaah fafrater 2, gre ate faa tsa ar FaTTATT HATS 11948 F gg Treaar ssa HT area feavaa at frag fretmataTa-BeBT squan at feat qatar) 1948 A afava areaforadt at farar ach ates wer aaa wari ga aafafad aterUST TU Wt 1949 aw feat wareH ara-He FT sae aél fxs Har aT1949 F alee ara-we Aeqraa Tra feat war) eA aoe F saatdada aafafat yer Fe areas ot raat ate AAT fog aT H fore sae fearTat at 1 1950% ates weaH area TH HTUsd aaa1922 ara at wat att ates erHA Sea eae freadTe gt efeTt aa SH| TKAA ea,For aeart A aaa ait(até Ft ezeq) (feqaa are fettacdla) arey,1950’ ara feat | aereata, efear gram cae Vaz, 1922 get Hala ATHTX«a[caer][ afaeralt]ar TANT HVT By 1950 F ast B as (2) Huy peda STS Ta) UH arg ae Fe STATS SEF ITAA ZIRT ga easel HUT HY BAT wear at aft araferarerdtar attire ax fear war | ea fafa & qearg PAT TATE A Ow afaaaT are HH qeadh cqetee & aaer FaaayUFeqeeraeT 1950 F arse ¥ ga: ss fear| arttarat-frertieat aT a 1940-4) aT are & fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA are & fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA & fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA war 1 attarelf-AreatPeht 4% Te-BATGATL SAA 1 attarelf-AreatPeht 4% Te-BATGATL SAA attarelf-AreatPeht 4% Te-BATGATL SAA 4% Te-BATGATL SAA Te-BATGATL SAA SAAara & faster} ates fate ad 1950-51 & far saeray agate Ht fear TAT |art % Frater at 1951-52 az 1952-53 & aafafag uea frat ay 1950-51% aafafaa qea & ararc ot faa fer ae ty atrarelf-fraifeet at eeiter4a @ fe qa aut & xara ar ofemaa 1950 ® arse Beas (2) % sare qzFRAT STAT ATE aT ae et aH TS ae ease wT UIT YT, WSBTAHSwetoralaaal & afeererita or alias ag fare anfsars at ax aca & fav aracas ari fratfedt fae at ag acter ataa sfrarfert atc ATA-BU aireara BT ATHAL BT ATE | athe afrecoy H aaa Mathes F We avilaat fe eacdtaco fate at afte F adh vet ar1 fratiedt at cette at at aitarzo%GITATATL HC FRAT aT af F ga fafeeaa & free yea Seaeq ua faze feat sar) sea alata + faface set at gaz faaifedt ® fragfeat| sea vararaa & ga frota ail fafieaa & onfaa ata, fraifet-fra & aTATATGE as Be ane fate fafea ager Tega feat. aecarats + rath arer area fru oe fata fata area at artes az fearsoa rarer & frie ate area & aafaa dee, feaifed-faa a sear arated rarer & frie ate area & aafaa dee, feaifed-faa a sear arated & frie ate area & aafaa dee, feaifed-faa a sear arated frie ate area & aafaa dee, feaifed-faa a sear arated ate area & aafaa dee, feaifed-faa a sear arated area & aafaa dee, feaifed-faa a sear arated & aafaa dee, feaifed-faa a sear arated aafaa dee, feaifed-faa a sear arated dee, feaifed-faa a sear arated feaifed-faa a sear arated a sear arated sear arated aratedH arate at| Serer ara grat atte arfemt aet eu, MAHARANA MILLS PVT. LTD. v. INCOME TAX TRIBUNAL, AHMEDABAD & ORS. MAY 3, 1989 [R.S. PATHAK, CJ. AND M.H. KANIA, JJ.] Income Tax Act 1922-Sections. I0(2)(vi) and 60A-Depreciation allowance and written ·down value-Computation of-Saurashtra Income Tax Ordinance 1949-Effect of. The appellant-assessee is a company carrying on the business of manufacturing and selling Textile at Porbunder (formely a princely State) in Saurashtra in the State of Gujarat. No income tax was levied by the former Porbunder State prior to 1948. In 1949 the princely State C of Porbunder integrated into newly formed Saurashtra State. In 1949 the State of Saurashtra promulgated the Saurashtra Income Tax Ordinance wherein provision for grant of depreciation based on written down value was made. On 26.1.1950, StateofSaurashtra became a part of the Union of India as a Part 'B' State and thus the Income Tax Act, 1922 became appli- o cable to the State of Saurashtra from 1st April 1950 under the Finance Act, 1950. The said Saurashtra Income Tax Ordinance was repealed under Sec. 13 of the Finance Act, 1950. Section 12 of that Act provided for removal of difficulties, if any, arising in giving effect to the Income Tax Act. The Central Govt. on 2.12.50 issued an order known as "Taxation Laws (Part B States) Removal of Difficulties) Order 1950". Clause 2 of the said order provided E the manner in which the aggregate depreciation allowance and written down value were to be computed. On March 9, 1953, the Central Govern-ment in the exercise of its powers under Sec. 60A of the Indian Income Tax Act, 1922, added an Explanation to the said clause (2). The vires of the said Explanation was challenged before the Andhra Pradesh High Court which held that the Explanation referred to above was ultra vires the powers of F the Central Government under Sec. 60A oftbe Income Tax Act. Commissioner of Income-Tax, Hyderabad v. D.B.R. Mills Ltd., [1956] 29 I.T.R. 210. Thereupon, the Central Government issued another notification dated the 8th May, 1956 in exercise of its powers under Section 12 of the G Finance Act 1950, whereby an Explanation in identical terms as the earlier Explanation was added to Clause (2) of the Removal of Difficulties Order, 1950. The validity of the said Explanation added by the '!otilica-tion dated 8th May, 1956 was upheld by this Court in The Commissioner of Income-tax, Hyderabad v. Dewan Bahadur Ramgopal Mi/is Ltd., [1961] 2 SCR 318. On the appeal from the said decision of the High Court [1989] 3 S.C.R. A of the Andhra Pradesh in Commissioner of Income-tax, Hyderabad v. D.B.R. Mills, [1956] 291.T.R. 210. The assessee was assessed under the Indian Income Tax Act from 1940-41 in respect of the income arising or deemed to arise in British India from 1940-41 onwards. For these years its income was assessed on receipt basis but in calculating the world income depreciation was taken into consideration for arriving at the income outside British India. The assessee was also assessed for the assessment year 1949-50. under the Saurashtra Income Tax Ordinance, 1949. From 1950-51 it was assessed under the Income 'f'.ax Act. The assessment years concerned in this case are 1957-58, 1958-59 and 1959-60, the corresponding previous years being the Calender years 1956, 1957 and 1958 respectively. The case of the assessee is that during the course of the assessment of its income, depre-ciation was allowed for the assessment year 1950-51 and thereafter on the original cost of the assets as reduced by the depreciation allowance given under the Saurashtra Income Tax Ordinance 1949. The respec-tive written down values for the assessment years 1951-52 and 1952-53 were fixed on the basis of the written down value for the assessment year 1950-51. But later the concerned Income Tax Officer rectified the calculations of depreciation allowance by further reducing the written down value of the assets of the assessee. The Income Tax Officer took the written down value for the assessment years 1940-41 as the starting point. The assessee was not satisfied with this rectification. Its conten-tion was that the depreciation for the previous years should have been calculated only on the basis of Clause (2) of the Taxation Laws (Part B States) (Removal of Difficulties) Order 1950, which provided for com-putation of the aggregate depreciation allowance on the basis of the deduction which was actually allowed under the Saurashtra Income Tax Ordinance, 1949. Regarding the explanation, the assessee contended that it was ultra vires the powers of the Central Government as it was not necessary for the removal of any difficulty. The contentions of the assessee were rejected by the Income Tax authorities as well as by Income Tax Appellate Tribunal. It was con-G tended by the assessee before the Tribunal that the· decision of this Court in Commissioner of Income Tax Hyderabad v. Dewan Bahadur Ramgopal Mills Ltd., [1961] 2 SCR 318 was no longer good law in view of the later decision of this Court in Straw Products Ltd. v. Income Tax Officer "A" Ward, Bhopal and Ors., [1968] 68, ITR 227. The Tribunal having rejected the said contentions, at the instance of the assessee a H reference was made to the Gujarat High Court in which the following question was raised: MAHARANA MILLS v. INCOME TAX TRIBUNAL, AHMEDABAD "Whether on the facts and in the circumstances of the case, the Tribunal wa~ justified in holding that the depreciation allowable and not 'actually allowed' under the Sauraslitra Income-tax Ordinance, 1949, should be taken into account in computing the aggregate depreciation allowance and written down value under Sec. 10(2)(vi) of the Income Tax Act 1922.'' · The High Court held that in its advisory jurisdiction under the Income Tax Act, it could not go into the question of the vires of the said Expla-nation and therefore answered the question against the assessee. There-fore, the appellant filed Special Civil Application 1797 of 1972 in the High Court, The Division Bench of the High Court in its judgment disposing of the said special Civil Applicaiion pointed out that the decision of this Court in the Commissioner of Incofl'l.e Tax, Hyderabad v. Dewan .Bahadur Ramgopal Mills, case referred to above had upheld the validity of the ExplanatiOn in question. The High Court. further opined that some of the arguments which did not rmd favour with this court in the said case were accepted by a Bench of 7 Learned Judges in the Straw Products Ltd. v. Income-Tax Officer, "A" Ward, Bhopal and Ors., [1968] 68 I. T .R. 227 . The High Court further pointed out that in its decision in the said case of Straw Products this court had considered the decision in Dewan Bahadur Ramgopal Mills Ltd. and explained that on the facts of that case a diffi-culty had arisen and it was for removing that difficulty that the Order of 1956 was issued. For the said reason the High Court considered that that decision was good law and following the same, it dismissed the Special Civil Application. Hence this appeal by the assessee . Jn this appeal the Explanation added by the Central Government ·. F by its notification dated May 8, 1956 as well as the assessments made on . the assessee for the assessment year 1957-58 to 1959-60 have been assailed. It was inter-alia contended on behalf of the assessee that there was no difficulty which had arisen in giving effect to the provisions of the Indian Income Tax Act in the State of Saurashtra and hence the pre'conditiim on which the Central Government was authorised to G make an Order under the Removal of Difficulties Order and add the Explanation in question .had never co!"e into existence and as sn_cl!. the Explanation was without the. authority of Law, invalid and of no legal _effect. It was further contended by the assessee that under the scheme of the Income Tax Act, generally speaking, almost the entire cost of a capital asset used for purposes of business or profession should H [1989) 3 S.C.R. Tat aT are & fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA are & fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA & fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA fare freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA freateor fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA fear war 1 attarelf-AreatPeht 4% Te-BATGATL SAA war 1 attarelf-AreatPeht 4% Te-BATGATL SAA 1 attarelf-AreatPeht 4% Te-BATGATL SAA attarelf-AreatPeht 4% Te-BATGATL SAA 4% Te-BATGATL SAA Te-BATGATL SAA SAA Se aTATAT soa rarer & frie ate area & aafaa dee, feaifed-faa a sear arated rarer & frie ate area & aafaa dee, feaifed-faa a sear arated & frie ate area & aafaa dee, feaifed-faa a sear arated frie ate area & aafaa dee, feaifed-faa a sear arated ate area & aafaa dee, feaifed-faa a sear arated area & aafaa dee, feaifed-faa a sear arated & aafaa dee, feaifed-faa a sear arated aafaa dee, feaifed-faa a sear arated dee, feaifed-faa a sear arated feaifed-faa a sear arated a sear arated sear arated arated afafaatita—aa ag araraa ga ford ot ogaaré fe sak ana fearravaTae ater -araals A ag warhtoa fer at fe ge ATAe at afRa frat AT THATar aatie ga aTae F Cat wears at a, area FH, eager ge ft atx gafaufogaa are fectacdts amex, 1956 ard wert ataway ari aaft ze aaacafareTH WTA TATA HAT ATHTT BT Beier & fee afsarsa; Gt HUA FHaT wea a afae F stata aa ae fae TA a as fafreaat & sraforgware at ators SayT Es Pag ag aarart freara adt 2 dar fe qet gaySeq ATTA FT aTATaT Alt Fa aaa cag daar wear dafra FATATA@a BT Heay fe aar tar frond frre ar aeere & gre afeaqar ararx at| TSTSTATIA AT A RAF AE AFIT HAT eaTATAT HT Hee ae F fae aa, TarAeeq H, tat ate sfore vaya eo oh, aetar a faeeqrarag eqaA Sfaot ag frepe frataat & far fe tet ae a#fsaré SAYA FF Fl, ATH Staarare tact at1 (Tz 18)7 me eat StH ael S fH ga atta a agax carats H fa fas faa weeLAHSra Tata fs stat1 eam afateat sa aaa F SAAT BVA Atel THATaT ATT Aaa:HAT Ga: Saye AA at qaraar F | (zt 19) waren fea to ATMAaETT agraret Sega ATTA H ae ease He ar agar f fe ates, gaHA. Faqartfsaa ar facaa fad afafran, 1950 a aren 13 ater garar a fe efeargaan dag tae & fret coda are| afeas eran can Uae FATT Artaat araicya att ararea eata ag @ fe aatefed geo wr softer str[H][ HTT]ag afr ad seat orlMt sam at H areafaH ara gf alt Teardadt ast Fdfeaa gaan gaa tae at gat ater frcfaa fadt afefrae onfe % aaaae: Aqara fat TT TAT ATAT BT HT HCH seta ATT |1 AGTarma Haft, ates grea cag asda gear gaaa caq tae are faefaaa feat arex fad afafraa, 1950 et aren 13 aret fated frat var ar frataft dt afoarg sara gs 1 aca, ae val Ter aT awa g fH TeaHTT HTT 4efroant fraraat & fry ag aaa arart zal aT fe areca A wforrs Gaye geft (Tar 20)oe_|pe 7argatea favia lo HTTo 280:ae—[1961] [1961] 2 Tao ao Ato 318=:(1961)41 argo——afaett HIG FATAcea, Aare aT Aart6,7, 10, 16aqgiget wantara face fafafes;17, 18,19 at 20[1975] to aro ato 1975 ao Ht 797=(1975)98Algo elo ATTo 209 :-azat sda faraia gate wea Ae ale eT: -16, 18[1968] to atFo Ao 1968 Uae ato 579= (1968) 68|ATRo Eto ATLo 227 :||eat iteaza fofaes aqme gaen aga anfeay, “zw” 6,7, 8, 17,ATS, ALATA BT eT;718, 19|[1956] (1956) 29 aTgoBo MTXo 210:mfRRAT HIG TAGH SA, STTATE TATH Bo ato HTToefava fafate,|6fafa aritet afratitat : 1975at fafa adit do 612 (wo ato). 1972 & faae fafa onaet fo 1797 F aaa sea saa ® arta24]25 fadat, 1974 & fata ate arte & few acter ||| qraata aifar— ag ate afaaret Faqege 1331) & sata fer ayTATA It 1972 % fang fafaa qraea Fear 1797 F Gata Sea qTde carats & fava % fees Ht Tee1 Gara Tea Ba VaHIT F— 2. fraifedt ca sted2 fafaes aaa 2 A qarca teh atte fae F Section: CONCLUSION be allowed to be written off by way of depreciation, whether worked on A the basis of straight line method or written down value. The assessee disputed the mode of assessment and the applicability of the Explanation. Following this Court's decision in ·Dewan Bahadur Ramgopa/ B Mills' Ltd. [1961) 2 SCR 318 this Court dismissing the appeal, HELD: The Saurashtra Income Tax Ordinance was repealed by Section 13 of the Finance Act 1950 and not by any provision in the Indian Income Tax Act. The basic and normal scheme of dwreciation under the Indian Income Tax Act is that it decreases every year, being a percentage of the written down value which in the first year is the c actual cost and in succeeding years actual cost less all depreciation actually allowed under the Income Tax Act or any Act repealed thereby etc. [lSD-E) Commissioner of Income Tax Hyderabad v. Dewan Bahadur D Ramgopal Mills Ltd., [1961) 2 SCR 318. The Saurashtra Income Tax Ordinance having been repealed not by the Indian Income Tax Act but by Sec. 13 of the Finance Act 1950, a difficulty had come into existence, and hence it could not be said that the Government had no good basis to come to the conclusion that a E difficulty had, in fact. arisen. [lSF-G) Madeva Upendra Sinai v. Union of India & Ors., [1975) 98 I.T.R. 209. CIVIL APPELLATE JURISDICTION: Civil Appeal No. 612 F (NT) of1975. From the Judgment and Order dated 24/25.9.1974 of the Gujarat High Court in Special Civil Application No. 1797 of 1972. Harish N. Salve, Mrs. A.K. Verma and Joel Pares for the Appellant. V,S. Desai, M.B. Rao and Ms. A. Subhashini for the Res-pondents. The Judgment of the Court was delivered by the High Court of Gujarat in Special Civil Application No. 1797 of 1972 on a certificate granted under Article 133(1) of the Constitution of India. The relevant facts are as follows: The assessee is a Private Limited Company and carries on the business of manufacturing and selling textile at Porbundar in Saurash-tra in the Gujarat State. Before 1948 Porbundar was a part of the Princely State of that name. No Income-Tax was levied by the erst-while Porbundar State prior to 1948. In 1948 there was a merger of several Princely States and as a result of the merger, the State of Saurashtra was formed. No income-tax was levied by the State of Saurashtra till 1949 when it promulgated the Saurashtra Income-tax Ordinance. Under that Ordinance provision was made for the grant of depreciation allowance based on the written down value. The said Ordinance defined "written down value" as follows: "'Written down value" means: (a) in case of assets acquired in the previous year, the o actual cost to the assessee; and (b) in the case of assets acquired before the previous year the actual cost to the assessee less all depreciation actually allowed to him under this Ordinance or allowed under an act repealed thereby or which would have been allowed to him if the Income-tax Act, 1922 was in force in past." On 26th January, 1950 State of Saurashtra became a part of Union of India as a Part B State. The Indian Income-tax Act, 1922 became applicable to the State of Saurashtra from 1st April, 1950 ~ under the provisions of the Finance Act, 1950. By Section 13 of the Finance Act of 1950, which provides for repeals and savings, the Saurashtra Income-tax Ordinance was repealed. Section 12 of that Act provided for the removal of difficulties as follows: "If any difficulty arises in giving effect to the provisions of any of the Acts, rules or orders extended by Section 3 or Section 11 to any State or merged territory, the Central Government may, by order, make such provision, or give such direction, as appears to it to be necessary for remov-ing the difficulty." A :.Tinancte ActL, 1950(,PthetCBenStral G)ov(eRrnmentissufed~fnf.order k)nowdn as axa 100 aws ar tales emova o 101 1cu 1 Iles 0r er, 1950". Clause (2) of the Order of 1950 reads as follows: feaa Wrage aA CATT IT eRe EA & fafaator ax far Hed lat TTATZata @11948 8 ga deaat eat aa F urea fara at wR wTati 1948 8 ga qaadt teaae tree ster fet gat aT ata-we Varga Tetfeataratati 1948 4 fahret areafeared ar faagaatmarate ea faraa & oferracaeg, ates Use TAT| 1949 wa ates TET gearg Aa-wHt BaTga ael feat rat ar) 1949 F sat alter erHy saeaitgaa veatfta feat| ea aearea & aaa aafafad ger oe araifea aaaareafoittraat are g¢— & fae sade fears) saa;seater staffed ger’ saree *« rafafad year’ A— (a) qdadtad & afsa anfeaat at arad, fratfedt at areafar aITT; AX| (a) qdadf ada cet ata anfecat at araa ga aeareat % areaaaa has at TTI cadet A HH faciad HR fet feraifedt afatran at Aredia aindaAMT aTseA agT SA AA TATfrat stat afe garaieSha Tae, 1922 faite F vaca aglar, aParT eV *HTT Hag TT AHI E: ‘* “Written down value’ means— cost_ to(a) the in assessee case of ; assets and acquired in the prévious. year, the actual +(b)/in*the éd€e “Of ‘assets “deqliired before ‘the ‘previous “Year- the actual-cost to the assessee less<all -depreciation<actually allowedto him under this Ordinanceor allowed under any act repealedthereby or which would have been allowedto him|if the Income-tax .Act, 1922 was in force in past.”| |Rarer fet To AraHT Afra.[eto aTfTaT] 3. 26 HAAR, 1950 BT Stee UST ATTA UTAH VT A ATA AT FTWIT aT TAT| Shera saHA zag Vac, 1922 faa afafrag, 1950 F saa Fafta 1 aia, 19508 diene usa stare at rar. fart afafrae, 1950 aae 13 arr feat facaa atx carafe & far wae &, ahase garHa cagateaa facfad ax feat vat| sa afafraa at are 12, frat aforreatfacrecy & fav sraa s, 2a THIEF — kena are 3 aT ater 11 are feet cegar facta casas atfacarfea fret afafran, fram at arte & sraeat at carat Tata HBTSafoaré sayt dt 2, AT HAT ALHTT, ATT gel, VAT Trae HT THAT2, at tar fataaamdl 2 at ferns freee F fre Ta arazaT setear 4, faa afafraa, 1950 at are 12 srer Ga Tact afaaat Hr Tah Heagu ada aac‘setae ain (oe ateten)(feqaa arg festacéta)arét [wzrara fafa (arta asa) (wfeate fruact) area] 1950 Ferata wa ada are feat1 1950 % ea arse (atea) aT ae (2) ea TaTK ekegefaa aaerag ale ate aafafad Aer Tt ATTAT : éfeaq gay faq daz, 1922 % aaa feat care Hr fate adAAT, AA-HT AT aht-Hr ar feat fafa & Tafa Barz FH ATAT TT HTat atad aT | Tse Fy Paral fafs at faant &aaa areaa H. tase.qaea eAAIT SIA (2)Ras (vi). F-TtaH F GI ae (7) F fataceqafra qaatan ale alt saa astray at are 10 HY TaaTer (5) 4de (a) % data aafafar gear al anya ea aaa fara a oftATTA| gaatHag Fa THT e— In making any assessment under the Indian Income-tax Act,1922, all depreciation actually allowed-under any laws or rules ofa Part B Staterelating to income-tax and Super-tax or any lawrelating to tax on profits of businessshall be. taken into accountin computing the aggregate depreciation allowance referred to insub-clause (c) of the Proviso to clause (vi) of Sub section(2) andthe writtendown value under {clause (b) of sub-section (5) ofSection 10 of the said Act. BeaaA eaTaTaT fora afrst [1990] 1 sHo fio qo rtd 7e fe, wet fret aries at avast aaretaT aT @ tT ateSUT Ueda Val F Fae ae Frater at aaa feel at F fare aaafrat qa a, Tqara stat Ufeat Fa Fae gel way gi feara F at| aaah y”| "Computation of aggregate depreciation allowance and the written down value: Provided that, where in respect of any asset, depreci-ation has been allowed for any year both in the assessment made in the Part B State and in the taxable territories, the greater of the two sums allowed shall only be taken into account." ' This order was made by the Central Government on December E 2, 1950. Subsequently, on March 9, 1953, in exercise of the powers conferred upon it by Section 60A of the Indian Income-tax Act, 1922, an Explanation was added by the Central Government to the above Clause (2) of the Order of 1950 with effect from that date and .that Explanation was in the following terms: · "For the purpose of this paragraph, the expression ';II depreciation actually allowed under any laws or rules of a Part B State' means and shall be deemed always to have meant the aggregate allowan_ce for depreciation taken into account in computing the wriifen down value under any laws or rules of a Part B State or carried forward under the said laws or rules." In Commissioner of Income-tax, Hyderabad v. D.B.R: Mills y· Ltd., [1956] 29 LT.R. 210 the Hyderabad High Court held that this Explanation was ultra vires the powers of the Central Government under Section 60A of the Indian Income-tax Act, 1922. After the said H decision of the High Court the Central Government issued a notifica- 5. 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HPASAT ATH SAHA Tea, Fatrates TATA Stara aergr cag feafafads! ater arte F sactaTa SeqeaTaTa[gs][ a][ Te][ afafaaifea][ fee][ fae][ae]easedfega gama faa ae, 1922 at Ter 60-0 F aaa HAT THTT FY Asay BTafraid at) set aqataa F sat fafreaa Bopara Hela TAHTe A faaafafara, 1950 at arer 12 arer weet afaaal ar sat HAI ST 8 AS, 1956 FTwa afrgaar at at ate ga afagaal H sata gfeas grHT eta Uae, 1922at arer 60-0 % tata fou ae area att aaeatfaa qaadh eqedtaco at afaraney frdaat 4 foqaa ate fentacdta arsz, 1950 % @e( 2) Fw equelaenyHST TAT| Het aH aHarel-frattedt straae zg, saat fratet 1940-41art fafzer fear F Saya sty areit at Seas aaa TE THA aT araT 1940-41& cfeaa gaan fae F aaa fear aan1 ga aat at fratfedt at ara at aatoaysift Harare ot aT TE, fey THT ara HT TAT HIS BAA, fates area F araxat ara fraraa & fw area Toy fear feat qar | fralfedt ar aes saa “For the purpose of this paragraph, the expression|‘alldepreciation actually allowed under any laws or rules of a Part BState’ means and chall be deemed always to have meant the aggre-gate allowancefor depreciation taken into account in computingthe written down value under any laws or rules of a Part B Stateor carried forward under the said laws or rules.” 2a as