RAM SWARUP KAUSHAL Vs. UNION OF INDIA UOI

JUDGEMENT

(1.) For the assessment year 1974-75, petitioner, R.S. Kaushal, was assessed to income-tax in the capacity of an HUF. As, apart from Ram Swarup Kaushal, other members of the said family also had independent sources of income, in respect of which they had been separately assessed to income-tax as individuals, the amount of tax payable by the petitioner was computed in accordance with the rates laid down in sub-para. II of Para. A of Pt. I of the First Schedule to the Finance Act of 1974. By this petition under Article 226 of the Constitution, the petitioner challenges the validity of the rates, for computing the income-tax payable by an HUF which at any time during the previous year had at least one member whose total income of the previous year, relevant to the assess- ment year commencing on April 1, 1974, exceeded Rs. 5,000, prescribed by sub-para. II mentioned above.

(2.) The petitioner claims that till the year 1974 various Finance Acts passed by the Union of India used to lay down rates for computing income-tax and surcharge which were uniformly applicable to all assessees. However, the Finance Act, 1974, laid down two different sets of rates mentioned in sub-para. I and sub-para. II of Pt. A to the First Schedule. Whereas, the rates mentioned in sub-para. I were to be applied in the cases of every individual, HUF (other than that mentioned in sub-para, II) registered firm or other association of persons or body of individuals, whether incorporated or not and every artificial person referred to in Section 2(31)(viii) of the Income-tax Act, sub-para. II laid down the rates applicable to an HUF which at any time during the previous year had at least one member whose total income of the previous year relevant to the assessment year commencing on April 1, 1974, exceeded Rs. 5,000. The rates so prescribed is in sub-para. I.

(3.) Learned counsel for the petitioner contends that the prescription of higher rates for the taxation of an HUF of which at least one member had an income above Rs. 5,000, is unconstitutional for the reason that it has the effect of contravening the provisions contained in articles 15(2), 14, 19(1)(g) of the Constitution and also because it has the effect of making the provisions of the Hindu Gains of Learning Act, otiose.