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Issues Involved:
1. Jurisdiction of the Expenditure-tax Officer under sub-section (2) of section 13 of the Expenditure-tax Act, 1957. 2. Applicability of the Expenditure-tax Act, 1957 to individuals deceased before the Act came into force. 3. Liability of executors, administrators, or legal representatives under section 18 of the Expenditure-tax Act, 1957. Issue-wise Detailed Analysis: 1. Jurisdiction of the Expenditure-tax Officer under sub-section (2) of section 13 of the Expenditure-tax Act, 1957: The petitioners challenged the notice issued by the 1st Expenditure-tax Officer under sub-section (2) of section 13 of the Expenditure-tax Act, 1957. The notice required the executors of the late Maharaja of Morvi to furnish an expenditure-tax return for the financial year 1957-58. The petitioners contended that the Act did not apply to the late Maharaja since he had died before the Act came into force. The court found the action of the 1st Expenditure-tax Officer to be without jurisdiction and void in law, thereby quashing the notice. 2. Applicability of the Expenditure-tax Act, 1957 to individuals deceased before the Act came into force: The court examined whether the Expenditure-tax Act, 1957, which came into force on April 1, 1958, applied to individuals who had died before this date. The petitioners argued that the Act is prospective and affects only those alive at the time it came into force. The court agreed, stating that it is a well-settled principle of law that a person not in existence when the Act came into operation cannot be affected by it. The court emphasized that there was no express provision or clear legislative intent in the Act to impose tax on individuals deceased before its commencement. 3. Liability of executors, administrators, or legal representatives under section 18 of the Expenditure-tax Act, 1957: The respondents argued that under sections 3 and 18 of the Act, the tax is imposed on the expenditure incurred in the previous year, and if the person is deceased, the executor, administrator, or legal representative is liable to pay the tax. The court found this argument unsustainable, noting that section 3 imposes the tax on an individual or Hindu undivided family incurring the expenditure, and not on their estate. The court clarified that section 18(1) applies only to individuals who die after the Act came into force. The court referred to the decision in Commissioner of Income-tax v. D.N. Mehta, which held that similar provisions in the Income-tax Act did not apply retrospectively to individuals deceased before the enactment. Conclusion: The court concluded that the Expenditure-tax Act, 1957, does not apply to the late Maharaja of Morvi as he had died before the Act came into force. Consequently, the notice issued by the 1st Expenditure-tax Officer was without jurisdiction and void. The court set aside the notice and directed the 1st respondent not to take any steps or proceedings under the Act against the petitioners concerning the expenditure incurred by the late Maharaja during the period from April 1, 1957, to August 17, 1957. The rule was made absolute against the 1st respondent, who was ordered to pay the petitioners' costs. The rule against the 2nd respondent was discharged without any order as to costs.
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