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Issues:
1. Whether the owner's share of Municipal tax under the Calcutta Municipal Act 1923 is considered a tenant's tax? 2. Can any deduction be made on account of the Municipal tax payable under Section 149, Calcutta Municipal Act 1923 in calculating the annual value of the property under Section 9 of the Income Tax Act, 1922? Analysis: 1. The case involved the assessment of the assessees' income from two properties in Calcutta, with a dispute arising over the treatment of the owner's share of the consolidated rate under the Calcutta Municipal Act 1923. The assessees argued that this sum should not be included in the calculation of their Income Tax. The Commissioner of Income Tax opined that the owner's share of the tax is a liability of the owner and cannot be deducted from the annual value of the properties as it is not authorized by the Act. 2. The judgment delved into the legal aspects of the case, emphasizing that the owner's liability for the Municipal tax is part of the consideration obtained from the tenant. It was highlighted that the actual terms agreed upon by the landlord and tenant are indicative of the property's annual value. The judgment disagreed with the notion that the tax payment should not be considered in determining the annual value, as it forms part of the total consideration received by the landlord. 3. The judgment also addressed the argument based on specific provisions of the Calcutta Municipal Act 1923 regarding unoccupied property and the remittance of the owner's share of the rate. It was clarified that while the tax may have certain characteristics related to occupation, it does not alter the fundamental principle that the tax is a liability of the owner and should be considered in assessing the property's annual value. 4. The judges unanimously agreed that the tax imposed under Section 149 of the Calcutta Municipal Act 1923 is the owner's liability and should be viewed as a benefit to the owner upon discharge. The judgment concluded by affirming that the annual value of the premises should not be equated to the total consideration paid by the tenant, emphasizing that it is a matter of fact to determine the actual annual value. Judges' Opinions: 1. Rankin, C.J., held that the tax is an owner's liability and should not be deducted from the annual value. 2. Charu Chander Ghose, J., concurred with the Chief Justice's opinion. 3. L.W.J. Costello, J., also agreed with the judgment delivered by Rankin, C.J.
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