AZAM JHA BAHADUR (DEAD) BY HIS LEGAL REPRESENTATIVES versus EXPENDITURE TAX OFFICER, HYDERABAD

Citation: [1972] 1 S.C.R. 470 · Decided: 30-08-1971 · Supreme Court of India · Bench: K.S. HEGDE · Disposal: Case Partly allowed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

470 
AZAM JHA BAHADUR (DEAD) BY ms 
LEGAL REPRESENTATIVES 
v. 
EXPENDITURE TAX OFFICER, HYDERABAD 
August 30, 1971 
[K. S. HEGDE AND A. N. GROVER, JJ.] 
Expenditure Tax Act, 1957-S. 2(g) (i) as amended by Finance Act, 
1957-"Dependent"' meaning of-S. 16, validity of notice under Legisla-
tive competence-Act covered by entry 97 List /, 
Constitution of India. 1950-Article 14-Taxing statute-Incidence of 
tax different on different classes of assessees-Does not a1nount to legislation 
without classification: 
Section 2(g) of the Expenditure Tax Act, 19'57, before its amendment 
by the Finance Act, 1959, defined 'dependent" to mean "where the assessee 
is an individual, his or her spouse or child wholly or mainly dependent on 
the assessee for support and maintenance". After the amendment 'depen-
dent' meant "where the assessee is an individual, his or her spouse or minor 
child, and includes any person wholly or mainly dependent on the assessee 
for support and maintenance". 
The appellant was assessed as an individuol to expenditure tax for the 
assessment years 1959-60, 1960-61 and 1961-62. After the completion of 
the assessment, the Expenditure Tax Officer issued notice under section 16 
of the Act calling upon the appellant to file supplementary returns for the 
three years on the ground that be had reason to believe that the appellant's 
expenditure had escaped assessment dr had been under assessed. 
The 
assessments were sought to be reopened for including the expenditure in-
curred by the wife of· the appellant. The appellant, thereupon, filed a 
writ petition in the High Court challenging the reopening of the assess-
ments on various grounds. The petition was dismissed. In appeal to 
this Court it was contended : 
(1) the appellant's wife, who admittedly 
had her own properties and assets and had substantial income therefrom 
could not be regarded as 'dependent' within the meaning of section 2(g) 
(i) and, therefore, her expenditure could not be included under section 
4(ii) for computing the expenditure of the assessee; 
(2) that there was 
no reasonable basis for making a distinction between an assessee, who was 
an individual and an assessee which was a Hindu undivided family; (3) 
that the action of the Expenditure Tax Officer in reopening the assessments 
under s. 16(a) was wholly arbitrary and illegal; that there had been no 
omission or failure on the part of the assessee to make a return of hi~ ex-
penditure or to disclose fully and truly all material facts; and the Act was 
void for want of legislative competence. 
Dismissing the appeal. 
HELD : (I) The Act divided the assessees mto well known classes, 
namely, an assessee who was an individual and an assessee which was a 
Hindu Undivided Family. The two cases were dealt with separately in 
s. 2(g) and in s. 4(ii). Where the assessee was an individual one had to 
look for his "deoendent" in cl. •(il and where the assessee was a Hindu 
Undivided Family the "deoendent" ,had to be found in cl. (g) (ii) of sec-
tion 2. After the amendment cl. g(i) of s. (2) under went a complete 
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PRINCE AZAM JHA v. E.T.O. (Grover, J.) 
471 
change. Before the inclusive part of the definition the meaning of the 
word "dependent" had been clearly and completely specified. The legisla· 
ture stopped short of making the spouse or the minor child "dependent on. 
the assessee for support and maintenance" and employed those words only 
for the new category of persons who came to be included, namely, any 
one who was neither the spouse nor the minor child of the assessee but was 
otherwise wholly ot mainly dependent on him for support and maintenance. 
In the absence of any ambiguity in the language employed in the first part 
of s. 2(g) (i) the plain meaning had to be taken. The whole construction 
of that clause left no room for doubt that in the first part, no question of 
dependence in fact arose and the spouse or the minor child simplicitcr had 
to be treated as .a "dependent". [477 A-H; 480 B-C] 
Commissioner of Expenditure Tax, Madras v. T. S. Krishna, 78 I. T. R. 
541 and Rajku1nar Singhji v. Conunissioner of Expenditure Tax, Nl.P., 
78 l..T.R. 405, disapproved. 
M. N. Patwardhan v. Co1nniissioner of Expenditure, Tax, 
Poona, 78 
I.T.R. 338, referred to. 
No double taxation would be involved if the meaning of the word 
"dependent" as given in the first part of s. 2(g) (i) was to be applied with-
out qualifying the same with w

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