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TMI Blog1979 (11) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... ars assessment years 1962-63 and 1963-64. In the original assessment made for the assessment 1962-63 and 1963-64. In the original assessment year 1962-63, the capital employed was found to be Rs.14,40,792 and 6% thereon was given as a relief under the provisions of s. 84 as it was then in force. Similarly, for the assessment year 1963-64, the assessee was granted relief at 6% on the capital employed as determined by the ITO in accordance with the provisions of the rules. Later, the ITO considered that excessive relief had been granted to the assessee and he, therefore, reopened the assessment under s. 147(a) of the Act. Apparently, the view of the ITO was that excessive relief had been granted by reason of the failure of the assessee to dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate of 6% on the capital employed in the industrial undertaking. The computation of capital is. governed by r. 19 of the I.T. Rules, 1962. This rule has been framed specifically for the purposes of s. 84. Rule 19 reads as under : "...the capital employed in an undertaking or a hotel to which the said section applies shall be taken to be-- (a) in the case of assets acquired by purchase and entitled to depreciation-- (i) if they have been acquired before the computation period, their written down value on the commencing date of the said period ; (ii) if they have been acquired on or after the commencing date of the computation period, their average cost during the said period ......... The expression " average cost " is defin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iving only a proportionate relief to the assessee. As a matter of practice of the administration of this provision it is stated that the six per cent. per annum has all along been applied, on the computation of the capital as made under r. 19. Section 84 had its predecessor in s. 15C of the Indian I.T. Act, 1922, introduced in the year 1949. Section 15C contained more or less identical words. The rule framed earlier under s. 15C was more or less repeated. The rules had not to deal with this aspect of application of six per cent. as the section contemplated rules being made only for computation of capital. The learned counsel for the revenue, however, contended that whatever might have been the practice, about which he did not say anyt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the expressions which it has used, without necessarily attributing to the legislature a precise appreciation of the technical appropriateness of its language. " The words " six per cent. per annum " are ordinarily applied to calculation of interest and in similar contexts. But the words " per annum " would be inappropriate in a taxing statute levying tax on the income earned during the previous year which is not necessarily a period of twelve months, though it would ordinarily be a period of twelve months. In the present case, the words " per annum " could even be dispensed with, as Mr. Jayaraman contended, and yet the section would carry the same meaning. We do not, however, consider the expression a surplusage. The words " per annum " ..... X X X X Extracts X X X X X X X X Extracts X X X X
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