THE INCOME-TAX OFFICER, BANGALORE versus K. N. GURUSWAMY

Citation: [1959] 1 S.C.R. 785 · Decided: 28-04-1958 · Supreme Court of India · Bench: SUDHI RANJAN DAS · Disposal: Appeal(s) allowed

Judgment (excerpt)

s:c.:R. 
SUPREME 'boURT ·REPORTS 
785 
above ~lirow vefr little light. There is, indeed, a dis-
;9ss 
tinction between h.n original or normal assessment 
k •. h· --
, 
d 
23 
d 
d 
· 3 
b 
La s mana Snenoy 
un er s. 
an a re-assessment un er s. 4; ut we . · 
v. 
·· 
· 
have shown that the word "assessment" has been The Income-tax 
used in more than one sense in Income-tax law, and Officer. Ernakulam 
so far as s. 13 (1) of the Finance Act, 1950, is con-
cerned,. there is ·no doubt that the expression 'levy, 
5· K. Das J. 
assessment and collection of income-tax' has been 
used in a comprehensive sense so as to include the 
whole procedure for imposing liability upon the 
taxpayer. 
Result: 
The final result, therefore, is-(a) the Travancore-
Cochin appeals (Civil Appeals 143 to 145 of 1954) are' 
dismissed with costs; and (b) the. Mysore appeals 
(CivU-Appeals 27 to 30 of 1956 and Civil Appeals 161 
to 164 of 1956) are allowed and the judgment and 
orders of the Mysore High Court are set aside. 
The 
appellants in these Mysore appeals will be entitled to 
their costs in this Court and the High Court of 
Mysore. 
Appeals Nos.143 to 145. dismissed. 
Appeals No. 27 to 30 arul 161to164 allowed . 
. THE INCOME-TAX OFFICER, BANGALORE 
z958 
', I , 
v. 
K. N. GURUSWAMY 
(S. R. DAS c. J., VENKATARAMA AIYAR, s. K. DAS, 
A. K. SARKAR and VIVIAN BOSE JJ.) 
Income Tax-Re-assessment-Taxable Area'in• Mysore within 
the jurisdiction of Governor-General in Council, retroceded in r947-
Constitutional changes resulting in Mysore becoming a Part B State 
~Financial agreement between the Presideni of India and the Raj-
pramukh-Income:tax law applicable to Retroceded Area before and 
after the 'Retrocession-Re-assessment proceedings for period prior to 
r949·-Validity-Mysore Income"tax Act, r92j (Mysore Y of r923), 
S; 34-Mysore Income-tax and,· Excess Profits Tax (Application to' 
• 
the Retroceded Area) (Emerg'ency) Act; r-948 ~Myso:·e XXXI of 
April 28. 
786 
SUPREME COURT REPORTS 
[1959] 
1958 
I948), ss. 3, 5 (b), 6-Retroccded Area (Application of Laws) Act, 
I948 (Mysore LV II of I948), ss. 3, 4-Finance Act, I950 (XXV 
The Income-lox of I950), s. I] (I)--Indian Income-tax Act, I922 (XI of I922), 
Officer, Bangalore s. 34. 
v. 
The respondent \Vas carrying on business as an excise con-
J<. N. Gurusuxony tractor in the Civil and Military Station of Bangalore in the 
State of Mysore, called the retroceded area. The jurisdiction 
over this area was originally exercised by the Governor-General 
in Council by virtue of an agreement with the Maharaja of 
Mysore, and the income-tax law applicable was the Indian 
Income-tax Act, 1922. On July 26, 1947, the retroceded area 
was given back to the State of Mysore but the income-tax law in 
force in that area prior to that date continued to have effect and 
be operative till June 30, 1948, on which date was promulgated 
the Mysore Income-tax Act and Excess Profits Tax (Application 
to the Retroceded Area) (Emergency) Act, 1948, the effect of 
which was that the Indian Income-tax Act, 1922, stood repealed 
and the Mysore Income-tax Act, 1923, came into force subject to 
certain saving provisions. On August 5, 1948, was prom11lgated 
the Retroceded Area (Application of Laws) Act, 1948. 
Between 
1947 and 1950 there were political and constitutional changes 
which ultimately resulted in Mysore becoming a Part B State 
within the Constitution of India. · The legal effect of these 
changes was that the income-tax law applicable to the retroceded 
area till June 30, 1948, was the Indian Income-tax Act, 1922 ; 
from July l, 1948, the Mysore Income-tax Act, 1923, became 
applicable except that the Indian Income-tax Act continued 
to apply in respect of the total income chargeable to income-tax 
in the retroceded area prior to July l, 1948, and the provisions of 
that Act as in force in the retroceded area prior to that date 
applied to all proceedings relating to the assessment of such 
income upto the stage of assessment and determination of 
income-tax payable thereon. This position continued till April 
I, 1950, when the Finance Act, 1950, came into force and as a 
result the Indian Income-tax Act, 1922, became applicable again 
to the retroceded area, subject to the saving provisions of s. 13(1) 
of the former Act. In respect of the assessment for the four 
years between 1945 and 1949, the respondent was assessed to 
income-tax under the law then in force in that area; subsequent-
ly, in 1954 the I

Excerpt shown. Read the full judgment & AI analysis in Lexace.