LexKARIMTHARUVI TEA ESTATE LTD. versus STATE OF KERALA
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• • A B c D KARIMTHARUVI TEA ESTATE LTD. v. STATE OF KERALA December 15, 1965 [P. B. GAJENDRAGADKAR, C.J., K. N. WANCHOO, M. HIDAYATULLAH, V. RAMASWAMI AND P. SATYANARAYANA RAJU, JJ.j The Kera/a Surcharge on Taxes Act ( 11 of 1957), s. 2-Wliether applicable to' the assessment year 1957-58, For the assessment year 1957-58, the appellant-company was assessed' to agricultural income-tax under the Kerala Agricultural Income-tu Act; 1950 and a •urcharge was also levied and collected from the appellant under the provisions of the Kerala Surcharge on Taxes Act, 1957. The· appellant appealed to the Deputy Commissioner, objecting to the imposi- tion of surcharge on the ground that the Jaw applicable to the assess- ment for 1957-58, under the provisions of the Agricultural Income-tax Act, was the law in force on 1st Ap,il 1957, and as the Surcharge Act came into force only from ht September 1957 and did not have retros- pective effect, the surcharge could not be levied for that year. The- Deputy Commissioner rejected the objections but the Appellate Tribunal on further appeal upheld the contentic>n. The High Court, on a reference,. held against the appellant. In appeal to this Court, HELD : The Surcharge Act having come into force on !st September· 1957, and not being retrospective in operation. it could not be regarded' E as law in force at the commencement of the Herir of assessment 1957-58 .. F G Since it was not the law in force on 1st .April 1957, no surcharge could be levied under it against the appellant in the assessment year 1957-58 .. [98 A-BJ Commissioner of Income-tax, Bo1nbay v. Scindia Steam Navigation' Co. Ltd. [1962] 1 S.C.R. 788 and The Commissioner of Sales Tax U.P. v .. The Modi Sugar Mills, [1961] 2 S.C.R. followed. l.T. Commissioner v. l.S. Lines, A.I.R. 1953 S.C. 439, explained. CIVIL APPELLATE JURISDICTION : Civil Appeal No. 980 of 1964. Appeal by special leave from the judgment and order, dated July 25, 1963 of the Kerala High ·court in Income-tax Referred' Case No. 10 of 1962 (Agrl.). · M. C. Setalvad, 0. P. Malhotra, V. 0. Abraham, .T. B. Dada- ' chanji, 0. C. Mathur and Ravinder Narain, for the appellant. ; P. Govinda Menon, A. Sreedharan Nambiar and M. R. K .. Pillai, for the respondent. U The Judgment of the Court was delivered by Satyanarayana Raju, J. This appeal, by special leave, against the judgment and order of the Kerala High Court, dated July 25. 94 SUPREME COURT REPORlS ( 1966 J 3 S.C.R. 1963 in Income-tax Referred Case No. 10 of 1962 (Agricultural), raises the question as to the true scope and operation of s. 2 of the Kerala Surcharge on Taxes Act, 1957 (Ker. Act XI of 1957), hereinafter called the Surcharge Act. The facts which have given rise to this appeal may be brietly stated. For the assessment year 1957-58, the appellant company was asscs~ed to agricultural income-tax under the Kcrala Agricul- tural lncemc-tax Act, 1950. In the assessment, a surch:1rgc at the rate of 5 % on the agricultural income-tax and '11pcr tax was also levied and collected from the appellant under th: provisions -0f the Surcharge Act. The appellant appealed to the Deputy Con11nissioner of Agricultural Income-tax and Sales Tax, South :Zon~. Quilon, · objecting tc the imposition of surcharge on the gwund that the law applicable to assessment for 1957-58 under the provii!ions of the Agricultural Income-taic Act was 1he law in force on April I, 1957 and as the Surcharge Act which came into force only from September l. 1957 did not have any retrospective effect. the sur- charge could not be levied for that year. By his order, dated November 14, 1959, the Deputy Commissiona re.iectecl these -Objections. A B c D Thereupon. the appellant preferred a further appeal to the E Kerala Agricultural Income-tax Appellate Tribunal, Trivandrum. By its order, dated August 2, 1961, the appellate Tribunal upheld the contention of the appellant holding that the Surcharge Act could not have retrospective operation unless there was a specific provisi0n therein to that effect. On the application of the respondent, the Tribunal stated a case to the Kcrala High Court and referred the following question ·Of law: "Whether any surcharge can be levied en the agricultural income-tax payable for the assessment year 1957-58 ?" By judgment. dated July 25, 1963, lhe Division Bench of the High Comt answered the question in the affirmative,
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