UNION OF INDIA Vs. INDIA FISHERIES PRIVATE LTD

JUDGEMENT

(1.) This appeal pursuant to a certificate of fitness granted by the High Court of Maharashtra at Bombay under Art. 133(1)(e) of the Constitution is directed against the judgment of the said High Court in a petition under Art. 226 of the Constitutions filed by the respondent.

(2.) The Indian Fisheries (P) Ltd. hereinafter called the respondent was a private limited company and was directed to be wound up by an order of the Bombay High Court dated October 11, 1950, and a Court Liquidator was appointed as the Officer Liquidator thereof with all powers under S. 179 of the Indian Companies Act, 1913 (VII of 1913) to be exercised by him under S. 180 without sanction or intervention of the Court save and except in case of sales of immovable property belonging to the respondent. For the assessment year 1948-49, the respondent was assessed on December 8, 1950, the tax being assessed at Rs. 8,737/15/- On or about March 15, 1951, the Income Tax Officer lodged a claim in respect of this tax with the Official Liquidator. That claim was adjudged and allowed as an ordinary claim and certified as such on April 2, 1952. In August, 1954, the Official Liquidator declared a dividend of 9 1/2 annas in a rupee and paid to the Income Tax Department a sum of Rs. 5,188/3/- against the claim made by the Income Tax Officer as an ordinary creditor. Thus a balance of Rs. 3,549/12/- still remained payable to the Income Tax Department from the assets of the respondent.

(3.) For the year 1955-56, the Department made a demand from the respondent on June 22, 1954, for a sum of Rs.2,565/6/- as advance tax. This was paid by the Official Liquidator. On a regular assessment being made for the said year, only Rs. 1,126/12/- was assessed as payable by the respondent. After adjusting this sum against the advance payment of Rs. 2,565/6/-, Rs. 1,460/1/- because refundable to the respondent, inclusive of interest. Instead of refunding the said balance to the respondent, the Income Tax Officer set off the said amount against the balance of Rs. 3,549/12/- which was still outstanding in respect of the Income tax demand for the year 1948-49. The respondent filed a revision petition to the Commissioner of Income-tax, but the said petition was rejected by the Commissioner on September 21, 1959, holding that the action of the Income Tax Officer was perfectly justified under the provision of S. 49E of the Income Tax Act.