HABIB AND SONS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS reference made to us under Section 66 (1) of the Indian Income-tax Act raises a very short point. By a decision of this Court, Commissioner of Income-tax v. Ekbal & Co., it was held that a notice given pursuant to Section 22 (2) of the Indian Income-tax Act, which requires an assessee to make his return within thirty days, was not a compliance with the sub-section and was an invalid notice. Thereafter, in order to validate all the income-tax notices given in the form referred to in that case, the Governor-General in exercise of his emergency powers under Section 72 of the Ninth Schedule of the Government of India Act promulgated two Ordinance upon which the titles were bestowed of the Income-tax and Excess Profits Tax (Validity of Notices) Ordinance, 1944 and the Income-tax and Excess Profits Tax (Validity of Notices) Amendment Ordinance, 1945. The conjoint effect of these two Ordinances is stated to be that for the removal of doubts it is hereby enacted that every notice published or issued, whether before or after the commencement of this Ordinance, but not later than the 19th of May, 1945 - then, so far as material to this case - under sub-section (2) of the said section or under sub-section (1) of Section 34 of the said Act, requiring a return to be furnished within thirty days of the receipt of the notice....... shall, notwithstanding any judgment or order of any Court, Appellate Tribunal or Income-tax authority to the contrary, and whether or not any specified date on or before which there turn is to be furnished is or has been given in the notice as an alternative, be deemed to give or have given a period of notice in full compliance with law; and the Ordinance goes on to provide that no such notice shall be called in question by any Court.

(2.) SIR Jamshedji Kanga, on behalf of the assessee, has submitted that the Governor-General in the exercise of his emergency powers cannot promulgate a law which is either retrospective to retroactive in its effect, and he points out that although that question was adumbrated in a decision of the Federal Court King Emperor v. Sibnath Banerjee, no decision was made upon it. However, there is a Full Bench decision of this High Court, which is directly in point, and which is indistinguishable, Emperor v. Prabhakar Kondaji Bhapkar. In that case the learned Chief Justice SIR John Beaumont at page 52 said :-

(3.) THE assessee must pay the costs.