1. This is an application in revision under section 5(2) of the Bombay Court Fees, 1959.
2. The petitioners are a private limited company and carry on the business of manufacture and sale electrodes and welding and electronic equipments. They are being assessed under the, 1961, as a private limited company and are also assessable under the provisions of the Companies (Profits) Surtax Act, 1964 (hereinafter for the sake of brevity referred to as 'the Surtax Act'). In respect of the assessment year 1964-65 the petitioners were assessed both under the was made on March 30, 1972, and as is shown by the said assessment order the designation of the officer who made the said order was Surtax Officer, Companies Circle I(9), Bombay.
3. Being aggrieved by this order of assessment the petitioners filed an appeal to the Appellate Assistant Commissioner, which was dismissed on February 27, 1973. The petitioners thereupon filed a second appeal to the Income-tax Appellate Tribunal. This appeal too was dismissed by the Tribunal's order dated January 22, 1974. Thereupon, the petitioners applied to the Tribunal under section 256(1) of the Income-tax Act, 1961, read with section 18 of the Surtax Act to state a case and refer certain questions of law to this High Court. This application was rejected by the Tribunal's order dated September 7, 1974. Thereupon, the petitioners filed a petition in this High Court, being the petition from which this application in revision arises, for a direction to the Tribunal to draw up a statement of the case and to refer to the High Court the questions of law set out in the said petition. When this petition was filed, the petitioners paid thereon court fees under article 1(f)(iii) of the Second Schedule to the Bombay Court Fees Act, 1959. The officer charged with seeing that the correct court fees was paid on the plaints, petitions, applications, etc., presented to this court was of the opinion that the court fees were payable under article 16 of Schedule I to the Bombay Court Fees Act, 1959. The question was thereupon referred by the Prothonotary and Senior Master of this court to the Taxing Master as provided by section 5(2) of the Court Fees Act. By her judgment and order dated March 25, 1976, the Taxing Master upheld the contention of the petitioners. It is against this order of the taxing master that the present application in revision has been filed by the applicant who is the officer appointed for this purpose under section 5(2) of the Bombay Court Fees Act.
4. In order to complete the narration of facts it may be mentioned that by a consent order dated November 10, 1975, the petitioner's petition was allowed and the Tribunal directed to make a reference as desire by the petitioners. On that day the petitioners gave an undertaking to the court to pay such additional court fees as may be found payable in respect of the said petition.
5. In order to understand the precise nature of the controversy between the parties it is necessary first to set out certain statutory provisions. Under Section 5(1) of the Bombay Court Fees Act, 1959, the court fees are payable as provided by the relevant articles in the Schedules to the said Act. Schedule I provides for ad valorem fees, while Schedule II provides for a fixed fee. Article 16 of the said Schedule I is as follows :
'16. Application or petition One-half of ad valorem feemade by any assessee to the leviableHigh Court under section 66 of on the amount in dispute,namely the difference between theamount of tax actually of taxadmitted by the assessee as payableby him, subject to the minimum feeof fifty rupees.'Article 1(f)(iii) of the said Second Schedule is as follows :'1. Application or petition ...(f) When presented to the HighCourt - ...(iii) in any other case nototherwise provided for by thisAct.'
6. It may be mentioned at this stage that though article 16 of Schedule I refers to section 66 of the Indian Income-tax Act, 1922, there is no dispute that since that Act has been repealed and re-enacted by the Income-tax Act, 1961, by reason of the provisions of section 8(1) of the General Clauses act, 1897, the reference to section 66 of the Indian Income-tax Act, 1922, is to be read as a reference to section 256 of the Income-ax Act, 1961. Surtax Act. An 'assessee' is defined by clause (1) of section 2 of the Supreme Court Act as follows :
''Assessee' means person by whom surtax or any other sum of money is payable under this Act and includes every person in respect of whom any proceeding under this Act has been taken for the assessment of his chargeable profits or of the amount of refund due to him or of the chargeable profits of any other person in respect of which he is assessable or of the amount of refund due to such other person.'
7. Under section 6 of the Surtax Act the assessment under the Supreme Court Act is to be made by an Income-tax Officer. There is a provision for appeal to the Appellate Assistant Commissioner and for a further appeal to the Appellate Tribunal. Section 18 of the Surtax Act provides as follows :
'18. Application of Provisions of Income-tax Act. - The provisions of the following sections and Schedules of the Income-tax Act and Income-tax (Certificate Proceedings) Rules, 1962, as in force from time to time, shall apply with such modifications, if any, as may be prescribed, as if the said provisions and the rules referred to surtax instead of to income-tax and Surtax :
2(44), 131 to 136 (both inclusive), 138, 140, 156, 160, 161, 162, 163, 166, 167, 170, 173, 175, 176, 178, 179, 220 to 229 (both inclusive), 231, 232, 233, 237 to 242 (both inclusive), 244, 245, 254 to 262 (both inclusive), 265, 266, 268, 269, 281, 282, 284, 287 to 293 (both inclusive), the Second Schedule and the Third Schedule :
Provided that references in the said provisions and the rules to the 'assessee' shall be construed as references as to an assessee as defined in this Act.'
8. Section 18 thus applies certain provisions of the Income-tax Act., including section 255 which provides for a reference to the High Court, to the Surtax Act. The provisions so applied are the procedural and penal provisions of the Income-tax Act. For purposes of levy and assessment of surtax Parliament has thus availed itself of the machinery provided for under the Income-tax Act. The sections of the Income-tax Act, which are made applicable by the said section 18 of the Surtax Act, are, however, not applied subject to three modifications set out in the section itself. These modifications are : (1) the modifications made in those sections by the Rules made under the Surtax Act, (2) as if for the words 'income-tax and Surtax' appearing in those sections the word used was 'surtax', and (3) the word 'assessee' used in those sections is to bear a different meaning than the one given in the Income-tax Act, that is, it is to bear the meaning which has been given to it by clause (1) of section 2 of the Surtax Act and not by clause (7) of section 2 of the Income-tax Act. We have already seen the definition of 'assessee' given in the Surtax Act. The definition of 'assessee' as contained in clause (7) of section 2 of the Income-tax Act is as follows :
''assessee' means a person by whom any tax or any other sum of money is payable under this Act, and includes -
(a) every person in respect of whom any proceeding under this Act has been taken for the assessment of his income or of the income of any other person in respect of which he is assessable, or of the loss sustained by him or by such other person, or of the amount of refund due to him or to such other person;
(b) every person who is deemed to be an assessee under any provision of this Act;
(c) every person who is deemed to be an assessee in default under any provision of this Act.'
9. Mr. Sanghavi, learned counsel for the applicant, submitted that article 1(f)(iii) of Schedule II to Bombay Court Fees Act, 1959 would apply to petitioners' said petition only if section 18 of the Surtax Act can be so construed as to mean that the sections of the Income-tax Act referred to therein are bodily incorporated in the Surtax Act and that if the construction were otherwise, then the court-fees which would be payable would be under article 16 of Schedule I to the Bombay Court Fees Act. Mr.Sanghavi further submitted that the said section 18 on a proper construction did not incorporate the said sections of the Income-tax Act into the Surtax Act. In support of his submission he relied upon a decision of the Supreme Court in Collector of Customs v. Nathella Sampathu Chetty : 1983ECR2198D(SC) , in which the Supreme Court held that when the provisions of one statute are incorporated into another, what is incorporated are the provisions as existing at the date of incorporation and not the subsequent amendments thereto. The Supreme Court pointed out that incorporation in effect meant the bodily lifting of the provisions of one enactment and making them part of another so that the repeal of the former enactment left the latter wholly untouched. In the course of the judgment their Lordships of the Supreme Court referred to several well-known formulae employed for effecting incorporation. Some of these formulae are, as pointed out by the Supreme Court (page 335 :
'... shall, for that purpose, be deemed to form part of this Act in the same manner as if they were enacted in the body thereof;' and
'The provisions of section... of the said Act... shall apply as if they were herein re-enacted.'
10. Mr. Sanghavi has laid considerable emphasis upon the fact that under section 18 of the Surtax Act what is made applicable in express terms are not certain sections of the Income-tax Act as they stood at the date of the passing of the Surtax Act but the said sections of the Income-tax Act 'as in force from time to time'. Relying upon these words in the said section 18, Mr. Sanghavi contended that the intention of Parliament was not to incorporate into the Supreme Court Act the sections of the Income-tax Act referred to in the said section 18 but merely to make a passing reference to them so as to make the procedural and penal provisions of the Income-tax Act as in force from time to time for the purposes of assessment to surtax under the Surtax Act.
11. In my opinion, the question whether the sections of the Income-tax Act, including section 256, which are mentioned in the said section 18, were incorporated into the Surtax Act or not has no relevance to the point which I have to decide. I, therefore, think it unnecessary to refer to the other authorities cited at the Bar. What I am concerned with is the construction to be placed upon article 16 of Schedule I do the Bombay Court Fees Act, 1959. Under that article the court fees at the rate provided therein is to be paid on an application or petition made by an assessee to the High Court under section 256 of the Income-tax Act and on no other application or petition. The Bombay Court Fees Act is an Act which levies a charge on citizens. Being an Act which levies a charge by way of court fee, it must be construed strictly. An application under section 256 of the Income-tax Act read with section 18 of the Surtax Act in the exact form in which it occurs in the Income-tax Act. It applies with the modifications made in it by section 18 of the Surtax Act, namely, that the word assessee' is to bear the meaning given to it by clause (1) of section 2 of the Surtax Act and not by clause (7) of section 2 of the Income-tax Act. If there were any modifications made hereafter in the said section 256 by the rules made under Surtax Act, though no such modifications have been made till today, then the said section 256 as further so modified. In this connection, it is also pertinent to note that in the assessment order the designation of the assessing officer is shown as Surtax Officer, Companies Circle I(9). Bombay. It is further pertinent to note that the order of the Tribunal dated September 7, 1974, rejecting the petitioner's application to state a case to the High Court opens thu :
'By this application under section 256(1) of the Income-tax Act, 1961, as applied to surtax by section 18 of the Companies (Profits) Surtax Act, 1964...'
12. Thus, the application which was made by the assessee to the Tribunal was not made under section 256(1) of the Income-tax Act simpliciter but was made under the said section 256(1) read with section 18 of the Surtax Act, and similarly the application which was made by the assessee to this High Court under section 256(2) of the Income-tax Act was not made under that section simpliciter but was under that section read with section 18 of the Surtax Act. This is also shown by the title of this petition which i : 'In matter of section 256(2) of the Income-tax Act, 1961, as applied by section 18 of the Companies (Profits) Surtax Act, 1964'. In Chairman of the Municipal Commissioners of Howrah v. Shalimar Wood Products (Private) Ltd., : 1SCR47 their Lordships of the Supreme Court pointed out that when by an enactment, the provisions of another enactment are made to apply to the former enactment with the modifications mentioned in such former enactment, the provisions so modified are not the statutory provisions as occurring in the Act which is made applicable but are different provisions altogether.
13. For the reasons mentioned above, I therefore, hold that the Taxing Master was right in the view which she took, and I, accordingly dismiss this chamber summons with costs fixed at Rs. 150.