9911796707
TMI Blog1936 (5) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... ital sum plus interest computed de die in diem from the last due-interest-date to date of purchase, is the said computed interest deductable from the interest actually received by him, in assessment under section 8 of the Act?" The assessment in question was made on a total income of ₹ 3,00,099 including ₹ 2,68,785 under Section 8 of the Income tax Act. The latter sum is made up as follows:- Interest (gross) received from Government in respect of securities purchased 1926-32 ... 2,55,750 0 0 Interest (income-tax free) received in respect of securities purchased from April to November 1933 ...13,035 0 0 Total ... 2,68,785 0 0 From this sum the assessee wishes to take the sum of ₹ 9,102-1-4 on the ground that it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest on securities' in respect of the interest receivable by him on any security of the Government of India etc. This section can only have one meaning and that is that income-tax is payable on the interest receivable from Government by any holder of such a security. This was the view taken by a Special Bench of the Patna High Court in Ranjit Prasad Singh v. Commissioner of Income Tax, Bihar and Orissa. There the opinion was expressed that section 8 of the Income-tax Act was conclusive so far as this question was concerned. The interest, it was said, was undoubtedly receivable by the assessees. It was received by them and the section thus made them liable. It was pointed out that interest on Government securities did not Accrue from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the owner of the security and credit shall be given to him therefore in the assessment, if any, made for the following year. Lastly, Section 48(3) provides for refund of the excess so credited to the owner of the security, if in the event the due charge is less than the deduction. The credit, therefore, under Section 18(5) can only be allowed to the owner of the security on his producing the certificate necessary under rule 38 while it is impossible to consider computed interest in the hands of the vendors. These machinery sections, therefore, support the view that the tax is chargeable only on the owner of the security at the time when the interest becomes receivable. The same question has arisen in England and is fully discussed in Wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istration of the Act, and I cannot conceive how the Acts could be administered, except at great cost and inconvenience not only to the Revenue but to private people who now are not concerned with these minutiae, if the contention which the Crown put forward here, not in their own interest but in the interest of purchasers really, was to succeed." The last observation of ROWLATT, J., has already been alluded to by me when dealing with the machinery sections. Clearly it would be impossible to keep track of interest adjustments between transferors and transferees of negotiable securities, and a statute, as remarked by Dunnedin, L.J., in Whitney v. Commissioners of Inland Revenue (10 T.C. at page 110) is designed to be workable and the in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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