9911796707
TMI Blog1922 (1) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... Indian Income Tax Act, VII of 1918. It is their contention that they are not such agents, and that they are not in receipt of any income of the persons whose agents they are alleged to be. 2. The Board has held that they were such agents and the matter has been referred to us upon the application of the Company. One substantial question is whether Sections 31 and 34 of the Indian Income Tax Act are to be read together or disjointly, in which latter case it would not be necessary in all cases that the agent should be in receipt of the income. On a consideration of this matter I am of opinion that Section 34 merely defines who may be included as an agent under Section 31. If so, the agent whether we look to Sections 31 or 34 must be in rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to pay super-tax on their income so derived. The profits due to those share-holders were sent to them by the Company to their residence outside British India. The Company was assessed for the super tax due on the income of those six share-holders as agent of the non-resident persons under the provisions of the Income Tax Act and the Company has raised the objections that it cannot be so assessed. The questions on which the decision of this Court is sought are, (1) whether the Collector of income-tax is right in holding that the Company is agent for these share-holders under Section 34, Act VII of 1918; and (2) if so, whether the Company has rightly been assessed to super-tax on their account. 7. A Company incorporated according to l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... behalf of such non-resident person of any income chargeable under the Act is held liable for the tax. If he is actually an agent and in receipt of income on behalf of the principal nothing more is necessary in order to render him liable, but the tax is to be levied upon and recoverable from him under Section 31 irrespective of any other provision in any other section of the Act. If is not necessary in such a case for the Collector to give the agent so liable any notice under Section 34 of his intention of treating him as agent of the non-resident person, because he is in fact the agent. Section 32 refers to the case where the income chargeable is received by the Court of Wards and certain other persons. This section has no direct beating o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng in accordance with the provisions of this section. Section 34, in my opinion, was enacted for the purpose of assessing the incomes of persons residing outside British India who are chargeable with income-tax here but who have not appointed any agents residing in British India who might be assessed under Section 33(1). To hold otherwise, it seams to me, would be to support an anomaly that a person receiving his income through an agent in this country would be assessed, but if he asks his debtor to remit the income direct to him he would escape liability to pay the tax, a thing which this section was intended to remove. It is only necessary that the person on whom the collector has served a notice under Section 34 is a person employed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to income-tax for another resident abroad, although he might not receive any income on behalf of such a person might, in some cases, cause great hardship. The answer to this is two-fold; (1) If is a well-established rule that Courts ought not to be influenced by any notion of hardship in exceptional or individual cases in interpreting a Statute, and (2) in order to prevent any case of hardship the proviso to Section 34 has been enacted and the Collector may be trusted to give effect to any reasonable objection before treating a person as agent under this section. In the present case, however, there can be no such question of hardship. It may be observed that under Section 21 of the repealed Income Tax Act (II of 1886) the tax was chargeab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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