9911796707
TMI Blog1931 (2) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... ve been made by the company. In this manner the average net profits for one year have been found to be ₹ 34,707. The company was for the first time assessed to Income Tax for the year 1928-29 on the basis of this income and there is no dispute as to this. But during the year 1928 the Income Tax Officer also proceeded to assess the company to Income Tax in respect of its profits for the year 1927-28 professing to act under Section 34, Income Tax Act. To this course an objection was taken on behalf of the company that the Income Tax Officer had no legal power to proceed under that section in the circumstances of the case. Consequently on the application of the company the following question has been referred for the opinion of this Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It therefore appears to me that during the year 1927-28 no machinery existed which made it possible in law for the Income Tax authorities to assess the income, profits or gains of the company during that year. 7. Section 59, Income Tax Act, provides that the Central Board of Revenue may...make rules for carrying out the purposes of the Act and for the ascertainment and determination of any class of income; it further particularly provides that it may make rules prescribing the manner in which and the procedure by which the income, profits and gains of the insurance companies shall be arrived at. In pursuance of the powers conferred upon the Central Board of Revenue rules have been framed (sic) it and the relevant rule is Rule 25 which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovides the only manner in which the income, profits and gains of Life Assurance Companies can be determined. It does not give any discretion to the assessing officer to depart from its provisions and to have recourse to the other provisions of the Income Tax Act for the purpose of determining and assessing the income, profits and gains of a Life Assurance Company. 9. That being so, it is clear, in my opinion, that in the year 1927-28 it was not possible under the provisions of the existing law for the Income Tax Officer to assess the Lakshmi Insurance Company to Income Tax. Can it therefore be urged that the income, profits and (sic) of the company escaped assessment during that year as that term is used in Section 34, Income tax Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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