HARRISONS AND CROSSFIELD Vs. COMMISSIONER QUILON MUNICIPALITY

JUDGEMENT

(1.) This batch of six petitions challenges the writ petitioners' being assessed to the professional tax under the Proviso to R.18(2) of the Taxa-tion and Finance Rules. These had been framed under the Travancore District Municipalities Act, No. XXIII of 1116, hereafter referred to as the Act, whose S.91 authorises the profession tax being levied, if the Council by a resolution determine such a tax being levied. The Section further enacts among other things that every company, which, after the date specified in the notification published under S.79, transacts business within the Municipality governed by the Act, for not less than sixty days in 'the aggregate in any half-year, should pay a half-yearly tax assessed in accordance with the Rules in Schedule II. Such schedule comprises among other things Rules 16 and 18, which alone are relevant for purposes of deciding these writ petitions. R.16 gives slabs of half-yearly income for purposes of assessment to the profession tax with the minimum half-yearly tax against each slab.

(2.) The reference to the Travancore Income Tax Act in Rule 18(1)(a), which evidently extended to the proviso to Rule 18(2) as well, was likely to cause difficulties after the Finance Act had extended the Indian Income Tax Act to Part B States and repealed the State enactment. As was expected, after the aforesaid repealment, an objection to being assessed under the proviso was raised in D. P. No. 34 of 1955, wherein the petitioner is the same that has filed O. P. No. 240 of 1956 before us, and therein also the assessments made on the company were for the same period as in the petition before us, though under the proviso to Rule 18(2) as it then, stood. The petition was allowed by a P.ivision Bench, which held that the proviso to Rule 18(2) had really provided for the adoption of certain figures representing the total profits as disclosed by an income tax assessment for a particular year, in which the emphasis was upon the assessable area, which, on becoming impossible of ascertainment, made the entire proviso absolute. Wide Harrisons and Crossfield, Ltd. v. Commissioner Quilon Municipality, ILR 1955 Tray-Co. 1003 : ((S) AIR 1956 Trav-Co. 174).)

(3.) The effort to make the amendments operate retrospectively was soon after attacked, and a party, assessed to pay the tax, challenged the vires of the amendments on the ground that the power to frame rules could not be exercised retrospectively. The objection was upheld by a learned Judge of the High Court in the Highland Produce Co., Ltd- v. Commr. Alleppey Municipal Council, O. P. Nos. 196 to 202 of 1955, dated 26-10-1956 (T-C.) where he found that the delegated authority under the relevant provisions of the Act could not frame rules with retrospective operations and, therefore, the amendments to Rule 18 (1) (a) were ultra vires. The Kerala Legislature then thought it expedient to enact the Profession Tax (Validation and Reassessment) Act, 14 of 1958, whose S.62 is necessary for purposes of deciding these writ petitions, and reads as follows: