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Issues:
1. Interpretation of the Hindustan Tractors Ltd. (Acquisition and Transfer of Undertakings) Act, 1978. 2. Adjustment of refund against liabilities predating the appointed day. 3. Commissioner's refusal to entertain application under section 264 of the Act. Analysis: The judgment pertains to a petition by a Government company, Gujarat Tractor Corporation Ltd., which was taken over by the Central Government under the Hindustan Tractors Ltd. (Acquisition and Transfer of Undertakings) Act, 1978. The Act mandated the transfer of all assets, rights, and liabilities of the company to the Central Government, free from encumbrances. The petitioner sought a review of an Income-tax Officer's order adjusting a refund against liabilities predating the takeover. The Commissioner, citing past non-compliance by the petitioner, refused to entertain the revision under section 264 of the Act. The Court emphasized that the petitioner, as a public undertaking, was obligated to discharge liabilities predating the takeover as per the Act. It criticized the Commissioner's refusal based on procedural delays, stating that such grounds should not hinder the application's consideration, as it would contradict the Act's provisions. The Court highlighted that liabilities not excluded under section 5(2) of the Act could not be enforced against the Central Government or the Government company post-takeover. The judgment underscored the Act's provisions, specifying the liabilities that become the responsibility of the Central Government or the Government company after the takeover. The Court quashed the earlier order and directed the Commissioner to re-examine the petitioner's case, emphasizing adherence to the Act's provisions. The ruling was in favor of the petitioner, with no costs imposed.
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