JAIPUR UDYOG LIMITED Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) WE have before us three writ petitions under Art. 226 of the Constitution questioning the validity of certain provisional assessments made under S. 141 of the INCOME TAX ACT, 1961, hereinafter to be referred as the "Act" , and as common questions of law are involved in them they can conveniently be disposed of together. As there is no dispute on facts, it will be sufficient to narrate the facts from Writ Petition No. 51 of 1964 (Jaipur Udhyog Ltd. vs. CIT).

(2.) THE petitioner No. 1 is a joint stock company registered under the Companies Act and runs a cement factory at Sawai Madhopur and is engaged in the business of manufacturing and distributing cement. The petitioner No. 2 is a shareholder of the company. They claim that the factory was established by the company in pursuance of an agreement between the company and the erstwhile Jaipur State whereby the company was exempted from the payment of all taxes including taxes on income for a period of 15 years from the date the company started the manufacture of cement from April, 1953. The petitioners proceed to say that in spite of this agreement the ITO assessed the company to income -tax. Aggrieved of this the petitioner -company filed a writ petition before this Court whereby it challenged the assessment order on the ground that on account of immunity of taxes conferred by the Ruler of the former Jaipur State the IT Department had no jurisdiction to assess the company. This writ petition was, however, dismissed by this Court on November 21, 1963. Against that decision, of course, the petitioner -company has obtained a certificate from this Court for appealing to the Supreme Court. The company continued to file its income -tax returns and the position about the assessment of these years will be clear from the subjoined statement : Assessment year . Returned figure . Assessed figure . . Rs. . Rs.

(3.) THE petitioners submit that the company filed representations to higher authorities against the provisional assessment made by the ITO and it also filed a revision application before the CIT under S. 264 of the Act, but without any success. The order of the CIT has also been placed on record. The CIT in his order observed that as the claim for carry -forward loss and not been determined in pursuance of the return filed under section 139 of the Act, S. 80 of the Act forbade the set -off in respect of such a carry -forward loss under sub -s. (1) of S. 71 or sub -s. (2) of S. 73 or sub -s. (1) of S. 74 of the Act.