Sri.k.mahendar v. The Commissioner Of Income-Taxchennai-34

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 20.03.2007 CORAM: THE HONOURABLE MR.JUSTICE P.D.DINAKARANandTHE HONOURABLE MRS.JUSTICE CHITRA VENKATARAMAN T.C. (Appeal) No.178 of 2003 Sri.K.Mahendar .. Appellant versus The Commissioner of Income-taxChennai-34. .. Respondent PRAYER: Tax Case Appeal filed under Section 260A of the Income Tax Act,1961, against the order dated 21.8.2001 in ITA No.185/Mds/1996 andC.O.No.24/Mds/1996 on the file of the Income Tax Appellate Tribunal,Madras Bench 'C' against the order dated 14.11.95 in ITA.No.59/95/96City Ward II on the file of The Commissioner of Income Tax (Appeals) VI- Madras - 600034 as against the order dated 30.01.95 inPA.No.GIR.No.138-H on the file of the Income Tax Officer, City Ward II(2), Madras - 600034. For appellant : Mr.R.Janakiraman For respondent : Mrs.Pushya Sitaraman Senior Standing Counsel for Income Tax JUDGMENT (Judgment of the Court was delivered by CHITRA VENKATARAMAN,J.) This appeal is by the assessee challenging the order of theTribunal on the following substantial questions of law:" (i) Whether on the facts and in the circumstancesof the case the Income-tax Appellate Tribunal wasright in law in holding that the sum of Rs.2,02,624/-has to be assessed as "capital gains" in theassessment year 1991-92 under Section 45(5)(b) of theIncome-tax Act, 1961?(ii) Whether the Income-tax Appellate Tribunal on thefacts and circumstances of the case was right in lawin upholding the applicability of Section 148 of theIncome-tax Act, 1961 especially when all the factswere placed before the assessing authority even whilehttps://hcservices.ecourts.gov.in/hcservices/filing the return and at the assessment stage itself?Tribunal on the following substantial questions of law:" (i) Whether on the facts and in the circumstancesof the case the Income-tax Appellate Tribunal wasright in law in holding that the sum of Rs.2,02,624/-has to be assessed as "capital gains" in theassessment year 1991-92 under Section 45(5)(b) of theIncome-tax Act, 1961?(ii) Whether the Income-tax Appellate Tribunal on thefacts and circumstances of the case was right in lawin upholding the applicability of Section 148 of theIncome-tax Act, 1961 especially when all the factswere placed before the assessing authority even whilehttps://hcservices.ecourts.gov.in/hcservices/filing the return and at the assessment stage itself? 2. The assessee and his brothers received certain lands in apartition in the year 1956 made by their father who died in the year1969. The said lands were acquired by the Government in the landacquisition proceedings. The assessee received compensation from theGovernment for the first time in the Assessment Year 1984-85. Theassessee went on appeal against the compensation granted under theacquisition proceedings before the Sub Court, Poonamallee, which orderedadditional compensation together with interest. Both the assessee aswell as the State went on appeal before the High Court. Till theassessment year 1990-91, the additional compensation received wasadmitted in the returns. In the Assessment Year 1991-92, the assesseereceived additional compensation of Rs.2,02,624/-. The assessee claimedexemption of this compensation by making an entry in Part-IV of theincome tax return. In the proceedings taken under Section 148, theassessing authority held that in view of the insertion of the Section 45(5)(b) with effect from the Assessment Year 1988-89, the additionalcompensation of Rs.2,02,624/- received by the assessee was taxable underSection 45(5)(b). It was pointed out that the State Government obtainedstay from the High Court, Madras; that it ordered release of 50% of theenhanced compensation. 3. It is seen that the Assessing Officer rejected theassessee's reliance on the decision reported in 161 ITR 524 (CIT Vs.HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST), taking the view that thedecision of the Apex Court would apply only to cases where theadditional compensation was assessed on accrual basis. The AssessingAuthority further pointed out that under Section 155(7-A) (since omittedwith effect from 1.4.1992) introduced the Finance Act, 1978 with effectfrom 1.4.1974 and amended by the Direct Tax Laws (Amendment) Act, 1978with effect from 1.4.1988, the additional compensation was liable to becalculated for the purpose of working out the capital gains in the yearin which the amount was received by the assessee. Noting the differencebetween the law as it stood prior to the amendment by the Finance Act,1987, and the law as on 1988-89 with reference to Section 45(5)(b) thatthe enhanced compensation would be brought to tax on receipt basis, theassessing authority held that the said sum was liable to be consideredfor the purpose of capital gains in the assessment year concerned,namely, 1991-92. 4. Aggrieved by this, the assessee went on appeal before theCommissioner of Income Tax (Appeals), contending that the law declaredby the Supreme Court in the decision reported in 161 ITR 424 (CIT Vs.HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST) still governed the issueeven after the amendment. 5. By order dated 14.11.1995, the Commissioner of Income Tax(Appeals) allowed the appeal. On the question of reopening theassessment, he held that the Assessing Officer was within hisjurisdiction to do so. The Commissioner of Income Tax (Appeals) alsonoted that the High Court, in its order, allowed the assessee tohttps://hcservices.ecourts.gov.in/hcservices/withdraw a part of the amount deposited by the Government. Thereafter, in the appeal preferred before the Apex Court as against the order ofthis Court in its order dated 25.7.1990, the Supreme Court allowed thewithdrawal of the said amount of 50% of compensation on the claimantassessee filing a written undertaking to return the same with interestif called upon. On the question of applicability of Section 45(5)(b),the Commissioner of Income Tax (Appeals) agreed with the assessee thatthe question as regards the right to enhanced compensation was still amatter to be adjudicated upon by the High Court, and hence the assesseedid not have the right to receive the enhanced compensation amount. Thequestion of capital gains could be considered in the year in which thematter was finally decided by the High Court. In so holding, theCommissioner of Income Tax (Appeals) followed the decision of theSupreme Court reported in 161 ITR 534 (CIT Vs. HINDUSTAN HOUSING & LANDDEVELOPMENT TRUST). Thus, on merits, the Commissioner of Income Tax(Appeals) allowed the appeal. 6. The Revenue preferred an appeal before the Income TaxAppellate Tribunal, challenging the correctness of the order of theCommissioner of Income Tax (Appeals) on the question of assessability ofthe compensation enhanced, then pending before the High Court for finalverdict. The assessee filed a cross appeal and challenged the order ofthe Commissioner of Income Tax (Appeals) that the appellate authorityerred in not giving a clear direction that the entire amount ofRs.2,02,624/- received from the Sub Court, Poonamallee, was not incomeand hence, taxable; that the Income Tax Officer bifurcated the saidamount, treating the sum of Rs.1,34,998/- as capital gains andRs.67,626/- as income from other sources, it being the interest onadditional compensation. The assessee challenged the reopening of theassessment under Section 148. By order dated 21.8.2001, the Income TaxAppellate Tribunal allowed the Revenue's appeal, holding that in termsof Section 45(5)(b) of the Income Tax Act, introduced in the statute inthe Finance Act, 1987, the assessee was liable to be assessed on theadditional compensation. As regards the cross appeal preferred by theassessee, the Tribunal held that the intimation sent under Section 143(1)(a) is subject to scrutiny and regular assessment under Section 143(3). The non-application of the provisions of Section 45(5)(b) is aserious irregularity and the same has to be corrected in the course ofregular assessment. Considering the amendment brought forth under theFinance Act, 1987 and the introduction of the provisions of Section 45(5)(b), the Tribunal viewed that the assessee was liable to be assessedto capital gains on the additional compensation received and that thedecision of the Apex Court reported in 161 ITR 524 (CIT Vs. HINDUSTANHOUSING & LAND DEVELOPMENT TRUST) was concerned with the provision priorto the amendment under Section 45(5), which was given effect to from1.4.1988. In the circumstances, the said sum was liable to be assessedunder the provisions of Section 45(5)(b). Consequently, the Tribunalconfirmed the assessment; thereby the liability to capital gains tax. 7. The assessee has now come on appeal before this Court,challenging the said order of the Tribunal. He contended that theintroduction of the amendment to Section 45(5) did not have the effecthttps://hcservices.ecourts.gov.in/hcservices/of nullifying the decision of the Supreme Court reported in 161 ITR 524 (CIT Vs. HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST). The assesseefurther contended that the right to receive the compensation and itscharacter as an income would arise or accrue only after the finaldetermination of the right of the assessee to the enhanced compensation.Consequently, the ruling of the Supreme Court reported in 161 ITR 524(CIT Vs. HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST) would apply in fullforce to the facts of the case. The assessee also questioned theTribunal's order in dismissing the cross objection that the action takenunder Section 148 was well within law. 8. Learned counsel appearing for the assessee submitted thatthe Tribunal ought to have considered the decision of the Apex Court inproper perspective to grant the relief. (CIT Vs. HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST). The assesseefurther contended that the right to receive the compensation and itscharacter as an income would arise or accrue only after the finaldetermination of the right of the assessee to the enhanced compensation.Consequently, the ruling of the Supreme Court reported in 161 ITR 524(CIT Vs. HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST) would apply in fullforce to the facts of the case. The assessee also questioned theTribunal's order in dismissing the cross objection that the action takenunder Section 148 was well within law. 8. Learned counsel appearing for the assessee submitted thatthe Tribunal ought to have considered the decision of the Apex Court inproper perspective to grant the relief. 9. Learned counsel appearing for the assessee pointed out to thepassages from the decision of the Apex Court to contend that theamendment had not brought forth any change in the declaration of law bythe Apex Court. He also referred to the order of the Apex Court dated14.11.1991 in C.A.No.3094 of 1990 etc. and to the order of this Courtdated 22.12.1997 in A.S.Nos.1122 of 1990 etc.; that the mere receipt ofmoney under an undertaking does not make the recipient as havingreceived the income; that until such time the dispute reaches afinality, the recipient need not claim it as his income. In thesecircumstances, placing reliance on the decision of the Karnataka HighCourt reported in [2004] 267 ITR 67 (CHIEF CIT Vs. SMT.SHANTAVVA), theassessee submitted that the decision of the Karnataka High Court fullygoverned the case and hence, prayed for setting aside the order of theTribunal. 10. Learned counsel appearing for the assessee submitted thatthe assessee was permitted to withdraw a portion of the enhancedcompensation only under orders of the Court and after filing a writtenundertaking, to return the same with interest, if called upon to do so.The holding of the said sum, hence, was as per the orders of the Court,pending a final outcome in the appeal preferred by the State. In theabove circumstances, learned counsel appearing for the appellantsubmitted that the final determination of tax is based on the amount ofcompensation receivable by the assessee, the receipt on an undertakinggiven did not have the character of income to attract the provisions ofSection 45(5). Given the circumstances that the final determination onthe amount of compensation was still a matter pending before the HighCourt, he pointed out that the ratio laid down by the Supreme Court inthe decision reported in 161 ITR 524 (CIT Vs. HINDUSTAN HOUSING & LANDDEVELOPMENT TRUST) applies to the facts of the case. In thisconnection, he also placed reliance on the decision reported in [1974]95 ITR 614 (SHAH VRAJILAL MADHAVJI Vs. CIT), apart from [2004] 267 ITR67 (CHIEF CIT Vs. SMT.SHANTAVVA), rendered by the Karnataka High Court.Hence, he prayed that the plea be accepted. 11. Learned standing counsel appearing for the Revenue, however,supported the orders of the Tribunal, placing reliance on Section 45(5)https://hcservices.ecourts.gov.in/hcservices/and the purpose of introduction of the same. 12. A perusal of the documents filed before this Court revealthat by order dated 9.4.1990, the Supreme Court, while granting theSpecial Leave, ordered as follows: 11. Learned standing counsel appearing for the Revenue, however,supported the orders of the Tribunal, placing reliance on Section 45(5)https://hcservices.ecourts.gov.in/hcservices/and the purpose of introduction of the same. 12. A perusal of the documents filed before this Court revealthat by order dated 9.4.1990, the Supreme Court, while granting theSpecial Leave, ordered as follows: " It is not necessary to consider the validity of theHigh Court order in view of the consent that isgiven by the claimants in this case. The claimantshave filed a counter affidavit dated 9.4.1990stating that they have no objection to the HousingBoard being impleaded as a party or co-appellant inthe pending appeals before the High Court. Theyhave also stated that they would give consent to anyapplications for receipt of additional evidence ifthe Housing Board comes forward with suchapplications subject to the liberty reserved to themto adduce rebuttal evidence. They have furtherstated that they would not oppose the applicationsof the Housing Board under Section 5 of theLimitation Act. In the light of the statements contained inthe counter affidavit of the claimants, we disposeof these SLPs. No order as to costs. Stay grantedin this case shall stand vacated. Claimants maymove the High Court for appropriate order forwithdrawing the compensation amount. " 13. The order in the main appeal was passed by the High Courtafter remand from the Supreme Court only on 22.12.1997. The furtherSpecial Leave Petition preferred was dismissed by the Supreme Court on22.1.1999. Hence, at least till orders on the question of additionalenhanced compensation reached a finality, the amount received by theassessee as per the orders of the Supreme Court was on the basis of awritten undertaking given by the assessee to return the receipt of 50%of the enhanced compensation with interest. 14. Dealing with the contention based on the decision of theSupreme Court reported in 161 ITR 524 (CIT Vs. HINDUSTAN HOUSING & LANDDEVELOPMENT TRUST), the Assessing Authority took the view that theprovisions of law under the Finance Act of 1987 made the difference thatthe amendment itself was brought about to cover cases of capital gainsarising out of additional compensation even in cases where finality hadnot been reached. 15. It is an admitted fact that Section 45(5)(b) was insertedwith effect from 1.4.1988 to cover cases of receipt of enhancedcompensation that they shall be deemed as income chargeable; that theyshall be considered for chargeability under the head "capital gains" ofthe previous year in which such amount was received by the assessee. 16. The provisions of Section 45(5)(b), as are relevant to thecase on hand, reads as follows:https://hcservices.ecourts.gov.in/hcservices/ " Section 45(5):Notwithstanding anything contained in sub-section(1), where the capital gain arises from thetransfer of a capital asset, being a transfer byway of compulsory acquisition under any law, or atransfer the consideration for which was determinedor approved by the Central Government or theReserve Bank of India, and the compensation or theconsideration for such transfer is enhanced orfurther enhanced by any Court, Tribunal or otherauthority, the capital gain shall be dealt with inthe following manner, namely:-(a) ....(b) the amount by which the compensation orconsideration is enhanced or further enhanced bythe court, Tribunal or other authority shall bedeemed to be income chargeable under the head"capital gains" of the previous year in which suchamount is received by the assessee;(c) ....Explanation:-- for the purposes of this sub-section, -- (i) ...(ii) ...(iii) where by reason of the death of the personwho made the transfer, or for any other reason,the enhanced compensation or consideration isreceived by any other person, the amountreferred to in clause (b) shall be deemed to bethe income, chargeable to tax under the head"capital gains", of such other person. " 17. A perusal of Section 45(5) shows that two conditions are tobe satisfied for the application of the Section, namely, the capitalgains must arise from the transfer of a capital asset by way ofcompulsory acquisition under any law and the compensation for suchtransfer is enhanced or further enhanced by any Court or Tribunal orother authority. 18. The purport of introduction of Section 45(5) needs to benoted. It is seen that the additional compensation is awarded at severalstages by different appellate authorities. This necessitatedrectification of the original assessment under the Income Tax Act ateach stage. To provide for rectification of the assessment of the yearin which the capital gain was originally assessed, Section 155(7-A) wasintroduced. Section 155 (7-A) of the Income Tax Act, 1961, enabled theIncome Tax Officer to re-compute the capital gains arising from thetransfer of the capital asset by taking the enhanced compensation to bethe full value of the consideration received or accrued as a result ofthe transfer. Thus the provision enabled re-computation by providinghttps://hcservices.ecourts.gov.in/hcservices/for a period of limitation of four years to be reckoned from the end of the previous year in which the additional compensation was received bythe assessee. However, difficulties were also experienced in caseswhere the additional compensation is received by a person other than theoriginal transferor where the legal heirs stepped into the shoes of theoriginal owner. Repeated rectification of assessment on account of theenhanced compensation at different stages often resulted in mistakes ofcomputation of tax liability. To remove these difficulties, sub section(5) of Section 45 was inserted by the Finance Act, 1987, to provide fortaxation of additional compensation in the year of receipt in respect ofthe transfer of capital asset. The explanation to sub section (5) ofSection 45, particularly to clause (iii), shows that where by reason ofthe death of the original owner or for any reason, the enhancedcompensation is received by any other person, the amount referred to inClause (b) shall be deemed to be the income of such other personchargeable to tax under the head of capital gains of the previous yearin which such amount is received by the assessee. The cost ofacquisition in the hands of the recipient is deemed to be nil. Thestreamlining of the provision amply makes it clear that theassessability of the enhanced compensation chargeable under the head"capital gains" is only with reference to the previous year in whichsuch amount is received on a final settlement of the quantum ofcompensation by the Court. A reading of the provision leaves no roomfor any interpretation that unless and until the right becomes anenforceable right, the mere claim cannot be regarded as a receipt toattract the provisions of Section 45(5)(b). With the claim for enhancedcompensation under dispute and the same pending during the AssessmentYear under consideration, conditional receipt does not bestow thecharacter of income under Section 45(5)(b). 19. In the decision of the Apex Court reported in [1954] 26 ITR27 (E.D.SASSOON AND CO. Vs. CIT), it has been held that to have thecharacter of income, a debt must have come into existence and theassessee must have acquired a right to receive the payment. TheApex Court held that unless and until there exist "a debt or a rightto receive the payment or in other words a debitum in praesenti,solvendum in futuro, it cannot be said that any income has accrued tohim." In the light of the above-said law laid down by the Apex Court,the stand of the assessee merits to be accepted. 20. Interpreting the provisions of Section 45(5)(b), theKarnataka High Court, in the decision reported in [2004] 267 ITR 67(CHIEF CIT Vs. SMT.SHANTAVVA), took the view that:" Section 45(5)(b) will be attracted only when theassessee receives the "enhanced compensation", inpursuance of a final award/order of a court, Tribunalor other authority increasing the compensation. Ifany amount is received after stay of the award, inpursuance of any interim order, as a payment subjectto the final result, it will not be an amountreceived as "enhanced compensation" contemplatedunder section 45(5)(b), but only an interim paymenthttps://hcservices.ecourts.gov.in/hcservices/received subject to final decision. It will attract section 45(5)(b) only when the final decision isrendered. We are supported in the said view by adecision of the Supreme Court and a decision of thiscourt. " section 45(5)(b) only when the final decision isrendered. We are supported in the said view by adecision of the Supreme Court and a decision of thiscourt. " 21. The decision of the Supreme Court reported in 161 ITR 524(CIT Vs. HINDUSTAN HOUSING & LAND DEVELOPMENT TRUST) relied on by theassessee and referred to in the above decision may also be noted. Itrelated to a case of an award granted in respect of compulsoryacquisition of land. It was taken up on appeal by the land owner. TheArbitrator made an award enhancing the compensation to Rs.30,10,873/- asagainst the award at a sum of Rs.24,97,249/-, and interest at 5% fromthe date of acquisition was also ordered. The State went on appeal tothe High Court. Pending the appeal, the State Government deposited a sumof Rs.7,36,691/-, being the additional amount payable under the award.The claimant was permitted to withdraw the said amount on furnishing asecurity bond for refunding the amount in the event of the Statesucceeding the appeal. The assessee credited the amount in a suspenseaccount on the same day. The said amount was assessed at the hands ofthe assessee in respect of the Assessment Year 1956-57 on the groundthat it became payable pursuant to the Arbitrator's award dated29.7.1955. The Tribunal held that the amount did not accrue to theassessee as its income during the relevant previous year ended on March31, 1956 and hence, not taxable in the Assessment Year 1956-57. Onfurther appeal, the High Court affirmed the decision of the Tribunal.The Apex Court confirmed the view of the Calcutta High Court. Referringto the decision reported in [1954] 26 ITR 27 (E.D.SASSOON AND CO. Vs.CIT), the Apex Court held, the terms "arising or accruing" referred to aright to receive profits and that there must be a debt owed by somebody.Considering the fact that the assessee therein was permitted withdrawalonly on furnishing security bond for refunding the same in the event ofthe appeal being allowed, the Apex Court held that "there was noabsolute right to receive the amount at that stage. If the appeal wasallowed in its entirety, the right of payment of enhanced compensationwould have fallen altogether." The Apex Court also referred to thedecision of the Gujarat High Court reported in [1978] 114 ITR 237(TOPAN DAS KUNDANMAL Vs. CIT) to hold that the additional compensationwhich are inchoate or contingent, would not create a debt that only on afinal determination of the amount of compensation that the right to suchincome in the nature of compensation would arise or accrue, and tillthen, there was no liability in praesenti in respect of additionalamount of compensation claimed by the owner of the land. The SupremeCourt pointed out that there was a clear distinction between a casewhere the right to receive payment is in dispute and it is not aquestion of merely quantifying the amount to be received and cases wherethe right to receive payment is admitted and the quantification is leftto be determined in accordance with the settled or accepted principles.The Apex Court pointed out that the enhanced compensation accrues onlywhen it becomes payable, i.e., when the Court accepts the claim. 22. This Court had an occasion to consider the question asregards the nature of receipt of the amount as per the interimconditional orders in State appeal in land acquisition matters pendingbefore the Court. In the decisions reported in 282 ITR 614 (CWT/CIT Vs.SMT GIRIJA AMMAL) and 289 ITR 245 (ANIL KUMAR FORMA (HUF) Vs. CIT), thisCourt held that the additional compensation received could not betreated as part of the compensation received for the transfer of theland until it is finally determined by the High Court or the SupremeCourt. The decision reported in 289 ITR 245 (ANIL KUMAR FORMA (HUF) Vs.CIT) followed the decision reported in 282 ITR 614 (CWT/CIT Vs. SMTGIRIJA AMMAL). The view expressed therein fully covers the issue heretoo. 22. This Court had an occasion to consider the question asregards the nature of receipt of the amount as per the interimconditional orders in State appeal in land acquisition matters pendingbefore the Court. In the decisions reported in 282 ITR 614 (CWT/CIT Vs.SMT GIRIJA AMMAL) and 289 ITR 245 (ANIL KUMAR FORMA (HUF) Vs. CIT), thisCourt held that the additional compensation received could not betreated as part of the compensation received for the transfer of theland until it is finally determined by the High Court or the SupremeCourt. The decision reported in 289 ITR 245 (ANIL KUMAR FORMA (HUF) Vs.CIT) followed the decision reported in 282 ITR 614 (CWT/CIT Vs. SMTGIRIJA AMMAL). The view expressed therein fully covers the issue heretoo. 23. It may be seen that following the decision of the SupremeCourt reported in 161 ITR 524 (CIT Vs. HINDUSTAN HOUSING & LANDDEVELOPMENT TRUST), a similar view was also taken by the Allahabad HighCourt in the decisions reported in 246 ITR 622 (CIT Vs. LAXMAN DASS) and[2004] 267 ITR 67 (CHIEF CIT Vs. SMT.SHANTAVVA). These decisions relateto the period prior to the amendment. 24. In the light of the decisions of the Apex Court and thisCourt referred to above, we accept the stand of the assessee and allowthe appeal on the issue relating to capital gains. 25. On the question of reopening of the assessment, we do notfind any error in the order of the Tribunal. The proceedings taken donot suffer from any illegality to warrant an interference by this Court.No serious argument was however made by the appellant too. 26. Considering the view that we have taken as to the scope ofSection 45(5)(b), we allow the Tax Case Appeal on the question ofassessability under Section 45(5)(b) of the Income Tax Act, 1961 andthereby set aside the order of the Tribunal. The appeal is allowed inpart. No costs. ksv https://hcservices.ecourts.gov.in/hcservices/ To: 1. The Assistant Registrar,Income-Tax Appellate TribunalMadras Bench 'C',Rajaji Bhavan, III Floor,Besant Nagar, Chennai - 90. 2. The Commissioner of Income Tax (Appeals)Madras - 600034. 3. The Commissioner of Income Tax-IChennai-34. 4. The Income Tax Officer,City Ward I(2), Madras - 34. 1 cc To Mr.R.Janakiraman, Advocate, SR.17357.1 cc To Mr.Pushya Sitaraman, Sr.Standing Counsel for I.T.Cases, SR.17240. 1 cc To Mr.Pushya Sitaraman, Sr.Standing Counsel T.C. (Appeal) No.178 of 2003 MS(CO)RVL 16.10.2007