On August 17, 1972 the High Court held that in its advisory jurisdiction under the Income tax Act it companyld number go into the question of the vires of the said Explanation and an swered the question against the assesee.
Thereafter the assessee filed Special Civil Application No.
1968 68 I.T.R. 227.
For the assessment years 1957 58 and 1959 60 the assessee again companytended before the Income tax authorities and the Tribunal that Explanation to Clause 2 as numberified in 1956 was ultra vires the powers of the Central Government.
It was companytended by the assessee before the Tribunal that the decision of this Court in The Commissioner of Income tax, Hyderabad v. Dewan Bahadur Raingopal Mills Ltd., 1961 2 C.R. 318 1961 41 I.T.R. 280 which upheld the validity of the Explanation was numberlonger good law in view of the decision of this Court in Straw Products Ltd. v. Income tax Officer.
A Ward, Bhopal, and Ors.,
From this decision of the Tribunal at the instance of the assessee a reference was made to the Gujarat High Court in which the following ques tion was raised Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that the depreciation allowable and number actually allowed under the Saurashtra Income tax Ordinance, 1949 should be taken into account in companyputing the aggregate depre ciation allowance and written down value under Section 10 2 vi of the Income tax Act, 1922?
The companytention of the assessee was rejected by the Tribunal by its order dated April 16, 1969.
Regarding the Explanation which was added as set out earlier, the companytention of the assessee was that it was ultra vires the powers of the Central Government as it was number necessary for the removal of any difficulty.
1797 of 1972 from the decision wherein this appeal arises.
This companytention of the assessee was rejected by the Income tax authorities as well as the Income tax Appellate Tribunal.
In this Spe cial Civil Application the vires of the Explanation added by the Central Government by its numberification dated May 8, 1956 in exercise of the powers under Section 12 of the Finance Act of 1950 as well as the assessments made on the assessee for the assessment years 1957 58 to 1959 60 were challenged.
For the assessment years 1954 55 to 1956 57 the depre ciation was calculated on the basis of the above rectifica tion order.
The companytention of the assessee is that the depreciation for the previous years should have been calcu lated only on the basis of Clause 2 of the Taxation Laws Part B States Removal of Difficulties Order, 1950, which provided for companyputation of the aggregate depreciation allowance on the basis of the deduction which was actually allowed under the provisions of Saurashtra Income tax Ordi nance, 1949.
45 of 1970.
612 NT of 1975.
From the Judgment and Order dated 24/25.9.
However, subsequently, the Income tax Officer companycerned having juris diction over the case of the petitioner, rectified the calculations of depreciation allowance by further reducing the written down value of the assets of the assessee by adopting the procedure which has been set out in paragraph 7 of the petition filed by the assessee.
1797 of 1972 on a certificate granted under Article 133 1 of the Constitution of India.
Harish N. Salve, Mrs. A.K. Verma and Joel Pares for the Appellant.
The relevant facts are as follows The assessee is a Private Limited Company and carries on the business of manufacturing and selling textile at Porbun dar in Saurashtra in the Gujarat State.
1974 of the Gujarat High Court in Special Civil Application No.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
For the assessment years 1950 51 to 1952 53, the depreciation allowance actual ly deducted under the assessment orders passed under the Indian Income tax Act was calculated and for the assessment year 1953 54 the depreciation allowance was calculated under Rule 8 of the Indian Income tax Rules made under the Indian Income tax Act.
The respective written down values for assess ment years 1951 52 and 1952 53 were fixed on the basis of the written down value for assessment year 1950 51.
This reference was numbered as Reference No.
As far as the appellant assessee is companycerned, it was assessed under the Indian Income tax Act from 1940 41 in respect of the income arising or deemed to arise in British India from 1940 41 onwards.
For these years income of the assessee was companyputed on receipt basis, but in calculating the world income, depreciation was taken into companysideration for arriv ing at the income outside British India.
S. Desai, M.B. Rao and Ms. A. Subhashini for the Respondents.
1797 of 1972.
The assessee was also assessed for assessment year 1949 50 under the Saurash tra Income tax Ordinance, 1949.
The Judgment of the Court was delivered by KANIA, J. This is an appeal from the judgment of a Division of the High Court of Gujarat in Special Civil Application No.
