Part B State income-tax law governed earlier assessment years, with appeal rights confined by the local statute until 1950-51.

For Part B States, the Indian Income-tax Act, 1922 extended only from assessment year 1950-51 and the corresponding previous year, so earlier assessment years remained governed by the local State income-tax law. On that construction, the Patiala Income-tax Act continued to apply to the assessee's liability for assessment years 1948-49 and 1949-50. As a result, orders passed under sections 18(3a) and 18(7) were not appealable under the Indian Act, and the only remedy lay in revision under the Patiala Act. The legal position therefore determined both the governing statute and the appellate route.

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Issues: Whether, for the assessment years 1948-49 and 1949-50 in the Pepsu area, the applicable law was the Patiala Income-tax Act or the Indian Income-tax Act, 1922, and whether appeals against the Income-tax Officer's orders were competent.

Analysis: Section 13 of the Indian Finance Act, 1950 extended the Indian Income-tax Act, 1922 to Part B States only for assessment year 1950-51 and the corresponding previous year, leaving the earlier assessment years governed by the local State law. Section 2(14A) of the Indian Income-tax Act, 1922, read with the Finance Act, confirmed that the Indian Act operated from 1 April 1950 for the relevant purposes. On that construction, the Patiala Income-tax Act continued to govern the assessee's liability for assessment years 1948-49 and 1949-50, and the orders under sections 18(3a) and 18(7) were not appealable under the Indian Act. The Tribunal's view that only revision lay under section 33 of the Patiala Income-tax Act was consistent with that legal position.

Conclusion: The Patiala Income-tax Act applied to both years in question, and no appeal lay against the Income-tax Officer's orders; the answer was against the assessee and in favour of the Revenue.

Ratio Decidendi: For Part B States, the Indian Income-tax Act, 1922 applied only from assessment year 1950-51 and the corresponding previous year, while earlier assessment years remained governed by the local State income-tax law, with appellate rights determined accordingly.

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