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Issues involved:
The petitioners sought a declaration that a specific section of the Income-tax Act, 1961 was ultra vires article 14 of the Constitution of India. Judgment Details: Issue 1: Validity of Section 64(1A) of the Income-tax Act, 1961 The petitioners contended that the amendment to section 64, which included the income of a minor child in the total income of the parent, was ultra vires. The court held that such provisions were within the legislative competence of Parliament under List I of the Seventh Schedule to the Constitution. Various statutes already clubbed the properties of minors with those of their parents, and this provision aimed to prevent tax evasion. The court cited precedents and legislative intent to support the validity of the provision. Issue 2: Constitutionality under Article 14 The petitioners argued that the provision violated article 14 of the Constitution by treating minor children differently. The court disagreed, stating that minors form a distinct class and can be treated differently for tax purposes. The court emphasized the wide discretion of the Legislature in tax matters and cited cases supporting the classification of laws to prevent tax evasion. Issue 3: Compliance with Income-tax Act The court found that the impugned provision, section 64(1A), was a machinery provision for computing income and did not contravene section 4 of the Income-tax Act. The court referred to legal observations and cases to support its conclusion that the provision was valid and aimed at curbing tax avoidance. In conclusion, the court dismissed the application, finding no merit in the arguments presented by the petitioners. The judgment upheld the validity of section 64(1A) of the Income-tax Act, 1961, as it fell within the legislative competence and aimed to prevent tax evasion effectively.
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