9911796707
TMI Blog1973 (11) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... ground of this petition are as under. For the assessment years 1961-62, 1962-63 and 1963-64 the petitioner is said to have incurred expenditure of the sum of Rs. 88,557, Rs. 4,018 and Rs. 47,339, respectively, on account of stamp duty, registration charges, lawyers' fees, acceptance fees of the bank and miscellaneous expenses in connection with the issue of debentures secured on all the fixed assets of the petitioner-company. The petitioner, relying upon the decisions of the Bombay and other High Courts, on the question of deductibility of such expenses, did not specifically claim the deduction thereof from its gross income in the respective years. The Income-tax Officer concerned did not allow these deductions during the course of the respective assessments. These assessments were subsequently rectified on some other points respectively on April 24, 1965, and October 6, 1965. It is an admitted position that the original assessments for all these three years were respectively made on February 25, 1963, February 14, 1964, and March 26, 1964. The expenditure which the petitioner claims to have incurred on account of the above referred charges was disallowed by the concerned Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er by revision application soon after knowing about this decision of the Supreme Court. It is an admitted position that the petitioner in view of these circumstances requested the Commissioner to condone the delay. The Commissioner, however, after hearing the parties, gave his decision on 29th January, 1970, refusing to condone the delay. This order is found at annexure " D ". Reference to it shows that the Commissioner was of the opinion that the fact that the Supreme Court had taken a different view was not a valid ground for condoning delay in filing the revision application. According to the Commissioner, if the petitioner had any doubt in the matter he should have kept the matter alive by taking appropriate action in good time. For this reason the Commissioner dismissed the revision application filed by the petitioner on the ground of limitation. It is against this order that this writ petition is preferred by the petitioner. As stated above, the contentions raised by the petitioner in this writ petition are two-fold. Its first contention is directed against the Commissioner's order rejecting its revision application on the ground of bar of limitation and its second content ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng. In fact, such expenditure was consistently treated by the Bombay and other High Courts as capital expenditure for years together. It was as early as 1921 that in In re Tata Iron Steel Co. Ltd., the High Court relied upon the following observations of Mathew. J. in Texas Land and Mortgage Co. v. Holtham : " The amount paid in order to raise the money on debentures, comes off the amount advanced upon the debentures, and, therefore, is so much paid for the cost of getting it, but there cannot be one law for a company having sufficient money to carry on all its operations and another which is content to pay for the accommodation. This appears to me to be entirely concluded by the decision of yesterday (Anglo-Continental Guano Works v. Bell)." Ever since the decision of the Bombay High Court in In re Tata Iron Steel Co. Ltd., the High Courts of Kerala, Madhya Pradesh, Calcutta and the Court of the Judicial Commissioner of Nagpur are found to have taken the same view at different times. It is, therefore, apparent that this view prevailed in India at least from the year 1921. The view was taken as settled law and, therefore, it is apparent that the petitioner had no cause wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ructuous, did not make any difference. Shri Kaji, who appeared for the respondents, contended that even if this court is of the opinion that the petitioner has been able to make out a case of having a sufficient cause for not preferring a revision application in time, there would be no justification for interfering with the decision of the Commissioner in a writ application unless it is found that the Commissioner has acted without jurisdiction or in excess of jurisdiction vested in him. It is true that the Commissioner had the jurisdiction to decide whether the delay in question should be condoned or not. But it is settled that the Commissioner, acting under section 33A of the Act of 1922 or under section 264 of the Act of 1961, is acting judicially and if he makes a palpable mistake in arriving at a decision by failing to apply the obvious and well-recognised principles of law on the subject, this court acting under article 226 of the Constitution would have full justification to interfere with such a decision with a view to set the matter right. In this case, we find that it was the pronouncement of the Supreme Court which made the whole difference in the situation and which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In this connection the learned Advocate-General tried to distinguish the previous decisions of the Supreme Court in Sha Mulchand Co. Ltd. v. Jawahar Mills Ltd., Bombay Gas Co. Ltd. v. Gopal Bhiva, Town Municipal Council, Athani v. Presiding Officer, Labour Court, Hubli and Nityanand M.Joshi v. Life Insurance Corporation of India as well as the decision given by a Division Bench of this court in Commissioner of Income-tax v. Western India Engineering Co. Ltd. Since we find that the petitioner should succeed in his first prayer on the question of condonation of delay, we do not find it necessary to go into the question whether the matter would be governed by sections 17 and 29 of the Indian Limitation Act. We thus find that the petitioner succeeds in obtaining the first relief claimed by it. On the second relief, the learned advocate for the parties addressed to us lengthy arguments relating to the alternative prayer contained therein for setting aside the original assessment orders on the ground that they are rendered illegal as a result of the decision of the Supreme Court in India Cements Ltd. On behalf of the respondents, Shri Kaji contended that so far as the second praye ..... X X X X Extracts X X X X X X X X Extracts X X X X
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