LexSHRI MANNA LAL AND ANOTHER versus COLLECTOR OF JHALAWAR AND OTHERS
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
962 SUPREME COURT REPORTS [1961) x960 _ the amount immediately not expended was not tax- Hoshiarpur Efoc- able as revenue. t.ic supply Co. The receipts though related to the business of the . v'. assessee as distributors of electricity were not inciden- Commissioncr of t l · th f h · f I t S . 1 a to norm e course o t e carrymg on o the asses- ncome- ax, im a , b . h _ see s usmess; t ey were receipts for bringing into exist- Shah J. ence capital of lasting value. Contributions were not ma.de merely for services rendered and to be rendered, but for installation of capital equipment under an agreement for a joint venture. The total receipts being capital receipts, the fact that in the installation of capital, only a certain amount was immediately ex- pended, the balance remaining in hand, could not be regarded as profit in the nature of a trading receipt. On that view of the case, in our judgment, the High Court was in error in holding that the excess of the receipts over the amount expended for installation of service lines by the assessee was a trading receipt. 1960 Dacember 7 The appeal is allowed and the question submitted to the High Court is answered in the negative. The assessee is entitled to its costs in this court as well as in the High Court. Appeal allowed. SHRI MANNA LAL AND ANOTHER v. COLLECTOR OF JHALAW AR AND OTHERS (B. P. SINHA, c. J., s. K. DAS, A. K. SARKAR, N. RAJA- GOPALA AYYANGAR and J. L. MUDHOLKAR, JJ.) Public Demand-Loan due to Jhalawar State Bank-Assets transferred to United State of Rajasthan under covenant, later vested in State of Rajasthan-If recoverable as a public demand-Certifi- cate--Reqt<irements, if applicable to loans due to Government- Special f~cilities to ~overnment as f!anker, whet':er discriminatory- Constitut1on of India, Art. r4-Ra;asthan Public Demands Recovery Act, r952 (Raj. V of 1952), s. 4· The Jhalawar State Bank was originally a Bank belonging ' to the rulin!,l State of Jhalawar and its assets, including moneys • ..... • 2 s.c.R. SUPREME COURT REPORTS 963 due to it, became vested in the United State of Rajasthan under the covenant executed by the Ruler of Jhalawar along with other Rulers by which the United State of Rajasthan was form- ed. On the promulgation of the Constitution of India, the United State of Rajasthan became the State of Rajastban in the Indian Union and all its assets, including the Jhalawar State Bank and its dues, vested in the State of Rajasthan. Moneys due from the appellants in respect of advances made to them by the Jhalawar State Bank at a time when it belonged to the ruling State of Jhalawar, could be recovered by the State of Rajasthan after the Bank had become vested in it, as a public demand under the lfajasthan Public Demands Recovery Act, i952. The form prescribed in the Rajasthan Public Demands Re- covery Act, in which a certificate has to be drawn up and filed under s. 4 of the Act for commencing proceedings for recovery of public demands under the Act in so far as it required a state- ment as to the period for which a public. demand is due, was not applicable to a public demand like a loan due to the Government in respect of which there is no question of any period for which it is due. The Rajasthan Public Demands Recovery Act did not offend Art. 14 of the Constitution as giving special facility to the Government as a banker for the recovery of the bank's dues for, the Government can legitimately be-put in a separate class for this purpose. CIVIL APPELLATE JURISDICTION: Civil Appeal No. 88 of 1957. Appeal from the judgment and order dated January 18, 1956, of the Rajasthan High Court (Jaipur Bench) in D.B.C. Writ Petition No. 262 of 1954. S. K. Kapur and Ganpat Rai, for the appellants. N. S. Bindra and D. Gupta, for the respondents. 1960. December 7. The Judgment of the Court was delivered by SARKAR, J.-The appellants are traders of Jhala- war. Respondent No. 1, the Collector of Jhalawar, served on the appellants a notice under s. 6 of the Rajasthan Public Demands Recovery Act, 1952, here- after called the Act, for the recovery from them as a public demand, of Rs. 2,24,607 /6/6 said to be due on account of loans taken by them from the Jh~lawar State Bank. The appellants filed a petition under s. 8 of the Act contending, among other things, that Shri Manna Lal a;. Another v. Collector of jhalawar a;. Others Sarkar j. 964 SUPREME CO
Excerpt shown. Read the full judgment & AI analysis in Lexace.