M.C. Chagla, C.J.
1. The facts leading up to this reference may be briefly stated. The assesses are a registered partnership firm carrying on business in the name of Kikabhoy Chandabhoy. Kikabhoy Chandabhoy himself was the sole proprietor of this firm and then there were changes in the constitution of that firm. He took Bai Fatima Bai, his daughter, as a partner in samvat year 1994 (1938-39) under an instrument dated October 13, 1938. Kikabhoy died on March 22, 1942. By an instrument of partnership dated March 29, 1942, a new partnership was brought into existence and that partnership was to commence business from April 1, 1942. That partnership consisted of the widow of Kikabhoy, his daughter and an outsider by the name of Abbasbhai Mohamedali. This partnership was dissolved on October 30; 1942.
2. In the assessment of this firm, for the year 1942-43 a claim was made that the firm was entitled to relief both with regard to income-tax and super-tax under Section 25(3) and Section 25(4) of the Act. The contention was that there was either a discontinuance or a succession within the meaning of either of these two Sub-sections on April 1, 1942, on the death of Kikabhoy or a new partnership coming into existence on that date. The Income-tax Officer who made the assessment rejected the contention of the assesses and refused to grant any relief either under Section 25(3) or Section 25(4) of the Act.
3. Then the matter came before the Income-tax Tribunal. The Income-tax Tribunal took a different view from the view taken by the Income-tax Officer and they held that there was a succession to the business within the meaning of Section 25(4) on April 1, 1942 and the assesses were entitled to relief under that section and no tax was payable within the meaning of Section 25(4) of the Act. Having come to that decision, the Income-tax Appellate Tribunal sent back the assessment to the Income-tax Officer with a direction that the assessment was to be made conformably to the finding arrived at by the Tribunal and the directions contained in Section 25(4) of the Act. The Income-tax Officer gave relief to the assesses with regard to the income-tax under Section 25(4) but refused to grant any relief with regard to super-tax, and the contention of the assesses both before the Tribunal and before us is that they were entitled to relief not only with regard to income-tax but also with regard to super-tax. The Tribunal rejected the contention of the assesses, and thereupon & reference has been made to us under Section 66(1,) of the Indian Income-tax Act; and two questions have been framed by the Tribunal for our consideration.
4. Now the first contention of Sir Jamshedji is that in view of the decision of the Tribunal that the assesses are entitled to relief under Section 25(4), it was not open to the Income-tax Officer not to give relief to the assesses with regard to super-tax also. It is argued that the effect of the Tribunal's decision was that no tax was payable in respect of the income, profits and gains of the particular broken period, namely, between October 20, 1941, the end of the previous year, and the date of succession and, therefore, 'no tax' included not only income-tax but also super-tax.
5. Now, in my opinion, it is impossible to read the decision of the Tribunal as amounting to a finding that no super-tax was payable in respect of the broken period contemplated by Section 25(4) of the Act. The contention of the assesses before the Income-tax Officer was that they were entitled to relief both with regard to income-tax and super-tax. The Income-tax Officer came to the conclusion that the contention of the assesses was not well-founded and they were not entitled to any relief. All that the Income-tax Tribunal held in appeal was that the contention of the assesses was well-founded, that there was a succession and that they were entitled to relief under Section 25(4) of the Act.
6. The question whether the assesses were entitled to relief with regard to super-tax in contradistinction to income-tax was never argued, never considered and never decided by the Tribunal. Obviously the Tribunal could not consider this question, because in order to decide that a question of fact had to be found which would enable the Tribunal to come to a conclusion whether the assesses was entitled to relief in respect of super-tax or not, because Section 25(4) contains a proviso which is material with regard to relief to super-tax and that proviso does not grant relief as to super-tax except where the income, profits and gains of a profession or vocation were assessed to super-tax for the first time either for the year beginning on April 1, 1920, or for the year beginning on April 1, 1921. Therefore it is only if the assesses paid super-tax for the first time for the year beginning from April 1, 1920, or April 1, 1921, that they are entitled to relief under Section 25(4); and in order to determine whether the proviso applied or did not apply, it was necessary to determine when the assesses paid super-tax for the first time and, therefore, when the matter was remanded back to the Income-tax Officer by the Tribunal, the Income-tax Officer went into the question on the facts before him and held that the assesses were not entitled to relief as regards super-tax as they had paid super-tax anterior to the period mentioned in the proviso. Now Sir Jamshedji says that as the Tribunal has not mentioned the proviso to Section 25(4) in its judgment, we must hold that the Tribunal was only considering Section 25(4); and as the expression used by them is that no tax was payable in respect of the particular broken period, they meant by 'no tax' not only income-tax but super-tax. We cannot attribute to the Tribunal a complete ignorance of the proviso to Section 25(4). When they stated that no tax was payable under Section 25(4), they meant Section 25(4) with all the qualifications and provisos and exceptions contained in that sub-clause; and that is made perfectly clear because there is a direction, as I have pointed out earlier, to the Income-tax Office to assess the income in conformity with the directions contained in Section 25(4) of the Act, and one of the most clear and specific directions is contained in Section 25(4), proviso (a), and that proviso is that the assesses are liable to super-tax if they paid super-tax prior to April 1, 1920. Therefore, in our opinion, there is no substance in the contention urged by Sir Jamshedji that it was not competent to the Income-tax Officer to assess the assesses to super-tax in view of the order of the Tribunal remanding this matter back to the Income-tax Officer.
7. The second submission made by Sir Jamshedji is that the first proviso to Section 25(4) has been nullified and set at naught by the provisions of Section 56 of the Act. Now Section 56 falls under Chapter IX of the Act which deals with super-tax, and Section 55 is the charging section which charges income to super-tax, and that section charges to super-tax in respect of the total income of the previous year of any individual, Hindu undivided family, company, local authority, unregistered firm or other association of persons. When we come to Section 56, the position is that the section has been amended in 1944, and we agree with Sir Jamshedji that, in order to determine the rights of the assesses, we must look at the section as it stood when the assessment was made and before the amendment, which is as follows:
Subject to the provisions of this Chapter, the total income of any individual, Hindu undivided family, company, local authority, unregistered firm or other association of persons shall, for the purposes of super-tax, be the total income as assessed for the purposes of income-tax, and where an assessment of total income has become final and conclusive for the purposes of income-tax for any year, the assessment shall also be final and conclusive for the purposes of super-tax for the same year.
Now, in the first instance, I should like to point out that this section does not deal with a registered firm. In terms registered firms are excluded from the operation of this section, and the assesses before us is a registered firm. But as a very careful argument has been advanced before us by Sir Jamshedji as to the effect of this section, I think it is necessary to consider that argument and to deal with it. The argument of Sir Jamshedji is that Section 56 is mandatory in its character, and it provides that the total income for the purposes of income-tax and for the purposes of super-tax shall be the same; and when the assessment of total income with regard to income-tax becomes final and conclusive, it also becomes final and conclusive for the purposes of super-tax. Therefore, according to Sir Jamshedji, there can never be any difference between the total income for the purposes of income-tax and the total income for the purposes of super-tax. Once you arrive at a particular figure as representing the total income liable to payment of income-tax, you must take the same figure as representing the amount liable to payment of super-tax. Now when we turn to the proviso to Section 25(4), clearly it provides two different standards for total income for the purposes of income-tax and total income for the purposes of super-tax; and although an assesses may have exemption under Section 25(4) as far as income-tax is concerned, he may not get exemption with regard to super-tax if he does not fall within the terms of the proviso. Therefore we have a case here where the total income for the purposes of income-tax would be different from the total income for the purposes of paying super-tax. Sir Jamshedji says that that is not permissible under the law; Section 56 is so mandatory and so clear that the effect of that section is to set at naught what the Legislature has in clear terms laid down in the proviso to Section 25(4). It would indeed be a startling conclusion to arrive at that in the same Act you find the Legislature with great deliberation making a distinction between the total income for the purposes of income-tax and the total income for the purposes of super-tax; and later on in the Act directing that in no case and under no circumstances can the total income for one purpose be different from the total income for the other purpose. Now, in my opinion, that is not a proper canon of construction to adopt in order to construe Section 56 and the proviso to Section 25(4). One of the well accepted canons of construction of a statute requires the Court as far as possible to reconcile the different sections of the Act in order to carry out the object of the Legislature; and, in my opinion, in this particular case there is no difficulty whatsoever in applying that canon in construing and reconciling these two sections we are considering. Section 56 lays down the ordinary normal method of assessing super-tax, and the ordinary normal method is that you must take the same total income for the purposes of super-tax as for the purposes of income-tax. But there are exceptions to this normal method and these exceptions are to be found in other parts of the Act, and one of those exceptions is the proviso to Section 25(4). Section 56 does not mean that you must adopt the normal method although the Legislature in terms clearly says that in a particular case you must depart from the normal course. I therefore see no irreconcilable conflict between the proviso to Section 25(4) and Section 56, and, therefore, in my opinion, Section 56 applies to those cases of computations of income-tax and super-tax which are not otherwise dealt with by the Legislature in specific sections of the Act. Sir Jamshedji has drawn our attention to the fact that in the amendment passed by the Legislature to Section 56 the proviso (a) to Section 25(4) is now expressly dealt with, and the amendment to the extent that it is material is in these terms:
Except in cases to which by Clause (a) of the proviso to Sub-section (4) of Section 25 that sub-section does not apply.
Sir Jamshedji contends that but for the amendment Section 56 would have nullified the effect of proviso (a) to Section 25(4).
8. Now it is not necessary to hold that in every case where the Legislature amends the law that it does so because but for the amendment the effect would have been something different. There are innumerable cases in the history of legislation where the Legislature has added or deleted words in order to clarify the position, and I refuse to read the amendment as meaning that but for it Section 56 would have overridden the clear provisions of the proviso (a) to Section 25(4).
9. The third contention urged by Sir Jamshedji is as to the construction to the proviso (a) to Section 25(4). It has been found as a fact by the taxing authorities that the assesses did not pay super-tax for the first time either in the year beginning from April 1, 1920, or in the year beginning from April 1, 1921. Super-tax was paid by them for the year 1919-20. Sir Jamshedji points out to us that the whole object of this proviso is just the same as the object of Section 25(3) and (4), i.e. to give relief to the assesses against double taxation. Sir Jamshedji says that the intention of the Legislature was that when an assesses paid super-tax under the Super-tax Act XIX of 1920, he paid double taxation and the Legislature wanted to relieve the assesses from the payment of super-tax twice over and, therefore, Sir Jamshedji wants us to read the words 'assessed to super-tax for the first time either for the year 1920 or for the year 1921' as assessed under the Super-tax Act XIX of 1920. Now really we can only ascertain the intention of the Legislature from the words used by it in the legislation we are considering. Relief's to assesses, avoiding hardship to them, are all matters of policy with which the Legislature is more concerned than ourselves. If there is ambiguity or doubt, we must give the benefit of that to the subject and relieve him from taxation; but when the language is clear and admits of no other interpretation, it is impossible for us merely by looking at the history of the legislation and speculating as to the object for which the Legislature enacted a particular piece of legislation to get away from the plain natural meaning of the language used by the Legislature and to give to it an interpretation which is entirely unwarranted. We must, therefore, construe the proviso as it stands and give to it its plain natural grammatical meaning, and if we do that, it is impossible to hold that relief was intended to be given to those who had been assessed to super-tax under the Super-tax Act XIX of 1920. Relief was only to be given to those assesses who paid super-tax for the first time either for the year beginning on the April 1, 1920, or for the year beginning on April 1, 1921.
10. The result, therefore, is that we must agree with the view taken by the Tribunal on all the three points urged by Sir Jamshedji
11. The answer, therefore, I would suggest to both the questions submitted by the Tribunal is in the negative.
12. Assessees to pay the costs.
13. I agree.