KALAWATI DEVI HARLALKA vs. COMMISSIONER OF INCOME-TAX, WEST BENGAL & ORS.

CIVIL APPEAL No. 1421/1966Supreme Court[1967] 3 S.C.R. 83301 May 1967Bench: 3 JudgesAuthor: J.C. SHAH, S.M. SIKRI, V. RAMASWAMI B15 pages
AI SummaryDismissed

What were the facts?

The appellant, Kalawati Devi Harlalka, received a notice on January 24, 1963, from the Commissioner of Income-tax, West Bengal, initiating revision proceedings under Section 33B of the Indian Income-tax Act, 1922, for assessment years 1952-53 to 1960-61. The appellant challenged this notice in the High Court under Article 226 of the Constitution, arguing that the 1922 Act was repealed by the Income-tax Act, 1961, effective April 1, 1962, rendering the Commissioner without jurisdiction. The High Court dismissed the petition, and a subsequent appeal to a Division Bench was also dismissed. The matter then proceeded to the Supreme Court.

What did the Supreme Court hold?

The Supreme Court held that the proceedings initiated by the Commissioner were valid. Firstly, it was determined that the term 'assessment' in Section 297(2)(a) of the 1961 Act has a comprehensive meaning, encompassing the entire procedure for ascertaining and imposing tax liability. Therefore, revision proceedings under Section 33B of the repealed Act were covered by this expression, as Section 297 was intended to address all contingencies arising from the repeal. Secondly, the Court ruled that Section 6 of the General Clauses Act was inapplicable because Section 297(2) of the 1961 Act clearly indicated a contrary intention by providing for various matters, some in accordance with and some contrary to the result under Section 6. Thirdly, Section 298 of the 1961 Act was held to be valid, and Clause 4 of the Income-tax (Removal of Difficulties) Order, 1962, promulgated under this section, covered the present case, granting the Commissioner jurisdiction. The appeal was dismissed.

What were the issues?

1. Whether the proceedings initiated by the Commissioner under Section 33B of the Income-tax Act, 1922, after its repeal by the Income-tax Act, 1961, were valid, specifically if they were covered by the expression 'proceedings for the assessment' in Section 297(2)(a) of the 1961 Act. Assessee's arguments: (i) The repeal of the 1922 Act by the 1961 Act divested the Commissioner of the power to initiate proceedings under Section 33B of the 1922 Act. (ii) Section 6 of the General Clauses Act, 1897, did not authorize the initiation of these proceedings as no steps were taken while the 1922 Act was in force. (iii) Section 298 of the 1961 Act was void, and even if valid, its powers could only be exercised concerning matters in Section 297, which did not cover Section 33B proceedings. Revenue's arguments: (Not explicitly recorded, but implied by the judgment's findings in favor of the revenue).

Which sections of the Income-tax Act were involved?

Section 297,Section 298,Section 33B,Section 6

AI-generated summary — verify with the full judgment below

A B c D E F G H KALAWATI DEVI HARLALKA v. COMMISSIONER OF INCOME-TAX, WEST BENGAL & ORS.

May 1, 1967 [J. C. SHAH, S. M. SlKR! AND V. RAMASWAMI, JJ.)

Income-tax Act, 1961, ss. 297 and 298-Commissionu issuing notice of revision of assessment under s. 33B of the Income-tax Act, 1922- whether such proceedings covered by the expression "proceedings for the assessment" in , .. 297(2) (a)-S. 6 General Clauses Act, 1897-Effect of s. 298 and the Income-tax (Remol'al of Dilfu:ulties) Orders, 1962-Vali- dilY of.

The appeljant received a notice on January 24, 1963 from the Com- missioner of Income-tax, We.t Bengal, initiating a revision under s. 33B of the Income-tax Act, 1922, of her asse.sments for the years 19S2-S3 to 1960-61. The appellant thereupon filed a petition in tlie High Court under Art. ~26 of the Constitution ?raying that the notice be quashed and the 1espondent restrained from giving effect to it. A single Bench of the High Court dismissed the petition and an ·appeal to a Division Bench was also dismissed.

It was contended on behalf of the appellant (i) that the Income-tax Act, . 1922, having been repealed by the Act of 1961 which came into force on A

The order continues below.

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