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TMI Blog1962 (11) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... COURT]Grant dated May 2, 1945, was not law and did not continue as such in Kotah and, secondly, article 295(1)(b) did not in any way invalidate the Finance Act, 1950, which extended the Indian Income-tax Act, 1922, to the territories of the State of Rajasthan including Kotah. - - - - - Dated:- 27-11-1962 - JUDGMENT The judgment of the court was delivered by S. K. DAS J.-This is an appeal on a certificate granted by the High Court of Rajasthan under article 132(1) of the Constitution. This appeal was heard along with two other appeals, Maharaja Shree Umaid Mills Ltd. v. Union of India (1), in which we have delivered judgment today. The short facts are these. The Associated Stone Industries (Kotah) Ltd., appellant before us, was incor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e enactment governing the levy, assessment or collection of the aforesaid taxes. The State of Kotah integrated with the other States of Rajasthan by a process the history of which we have described in the judgment delivered today in the other two appeals. By that process of integration Kotah first came within the United State of Rajasthan ; thereafter on January 26, 1950, the United State of Rajasthan became the Part B State of Rajasthan in the Union of India within the framework of the Constitution of India. By virtue of the Finance Act, 1950, the Indian Income-tax Act, 1922, was extended to the territories of the Part B State of Rajasthan. The Government of India appointed a Commissioner of Income-tax for Rajasthan. An Income-tax Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aration that the application of the Indian Income-tax Act, 1922, to the appellant during the continuance of the grant was a violation of article 295 of the Constitution and therefore illegal and void. The appellant also claimed certain other reliefs the details whereof need not be set out. The suit was contested by the Union of India as also by the State of Rajasthan, the two defendants in the action. The learned District Judge who tried the suit framed as many as eleven issues and gave his findings on most of them. While dealing with issue No. 11 which raised the question of the reliefs to which the appellant was entitled, the learned district judge referred to section 113 of the Code of Civil Procedure and then said : " In this case I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 which related to the question of reliefs to which the appellant would be entitled. Obviously enough, the decision on issue No. 11 would depend on the decision of other issues of law and fact. The High Court, however, decided the constitutional question which arose in the case and this question the High Court formulated as follows : " Whether in view of article 295 and clause 18 of the grant, it can be said that the legislative power of the Union of India contained in article 245 is in any way fettered so that the Union of India cannot pass any law which would take away the exemption in clause 18, assuming it to be there. " The High Court answered the question against the appellant. It also rejected two other arguments, one based on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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