9911796707
TMI Blog1999 (10) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... Act in section 2(h) defines "owner". The definition "sick textile undertaking" is found in section 2(j). Reading the two together, it is clear that the "owner" is distinct from the "sick textile undertaking". What the Act provided for is only the acquisition of the sick textile undertaking. The owner of the undertaking was to be paid compensation, the amount of which is set out in the Schedule to the Act. Cambodia Mills is mentioned in the Schedule at serial No. 23. The amount payable to it as compensation is Rs. 64,40,000. Section 5 of the Act makes it clear that the owner of the undertaking continues to be liable for all liabilities other than those specified in sub-section (2) of section 5, and that such liabilities shall be enforceable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, Rs. 64,40,000. Chapter VI of the Act deals with Commissioners of Payments. Section 20 therein requires every person having a claim against the owner of a sick textile undertaking to prefer such claim before the Commissioner within thirty days from the specified date which can be extended by a further period of thirty days by the Commissioner. Section 21 of the Act deals with priority of claims. The order of priorities for the discharge of liabilities of a sick textile undertaking is set out in the Second Schedule. The liabilities are classified into six categories. Revenue, taxes, cesses, rates or any other duties to the Central Government or a State Government fall under Category II. The claims when properly made are required to be exa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, the National Textile Corporation (Tamil Nadu and Pondicherry), and held that it was liable to pay the tax dues of Cambodia Mills Limited that had accrued up to April 1, 1974. That order was made by him oil December 28, 1984. The assessee filed an appeal against that order to the Commissioner (Appeals) who set aside the same The Revenue then preferred an appeal to the Tribunal, which affirmed the order of the Commissioner. At the instance of the Revenue, the following two questions have been referred to us by the Tribunal : "(1) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right 'in law in holding that the order of the Income-tax Officer under section 170(3) of the Income-tax Act, 1961, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by way of revenue, cess, tax or other dues to the Central Government were classified under Category II, which in terms of priority come only after the satisfaction of the liabilities mentioned in Category I. We are surprised that the second question should have at all been framed or referred to us. The provisions of the Act can leave no room for doubt that the company-Cambodia Mills Limited, was not taken over by the Central Government under the provisions of the Nationalisation Act. The finding of the Tribunal that it was not so taken over is undoubtedly correct. After the acquisition of the undertaking of Cambodia Mills Limited, in terms of Central Act 57 of 1974, that undertaking vested initially in the Central Government by virtue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s compulsorily acquired, for the purposes of section 170 of the Income-tax Act. The transferee from the Government similarly is not a successor, much less a transferee from such transferee of the Central Government. The order made by the Income-tax Officer treating the National Textile Corporation (Tamil Nadu and Pondicherry) Limited as the successor-in-interest of Cambodia Mills Limited, notwithstanding this provision made in the Act for the payment of compensation to that company is wholly untenable in law. The Sick Textile Undertakings (Nationalisation) Act is also a special enactment in so far as sick textile undertakings are concerned. To the extent provision is made therein for the revenue arrears of the Central Government, the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to Cambodia Mills Limited, cannot indirectly be enhanced by the Income-tax Officer by compelling the transferee whose title is traceable to the Central Government to pay amounts in addition to the amounts of the compensation provided for in the Act. It is not the province of the Income-tax Officer to amend or add to legislation enacted by Parliament directly or indirectly. The revenue arrears of Cambodia Mills Limited could only have come out of compensation payable to it under the provisions of the Nationalisation Act or out of any other asset that may have been owned by Cambodia Mills Limited apart from the sick textile undertaking acquired under the Act. After the vesting of the undertaking in the Central Government, there was no scop ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
