Contextual reading of "payable" upheld compulsory pre-assessment deposit under the revenue scheme

The compulsory deposit scheme was upheld as a valid revenue measure because the statute authorised the time and manner of deposit, and the first proviso to paragraph 4(1) was treated as a special, severable time limit for the relevant year. The word "payable" in section 4(3) was construed in its ordinary, contextual sense, not by importing the Income-tax Act meaning, because the scheme required deposit before assessment and linked it to deduction from surcharge. The discrimination challenge also failed, as no unequal treatment was shown and the longer period in the proviso was available to the petitioners.

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Issues: Whether paragraph 4(1) and its first proviso of the Compulsory Deposit (Income-tax Payers) Scheme, 1963, were invalid for requiring compulsory deposit before assessment, whether the word "payable" in section 4(3) of the Compulsory Deposit Scheme Act, 1963, meant payable only after assessment, and whether the proviso was discriminatory.

Analysis: The statutory scheme contemplated compulsory deposits to augment revenue and empowered the Central Government under section 5 to fix the manner and time for deposit, while sections 12 and 13 showed that the deposit had to be made within a time specified by the scheme. The first proviso to paragraph 4(1) supplied a special and severable time limit for the relevant assessment year, so the challenge based on sub-paragraph (1) itself could not defeat it. The word "payable" in section 4(3) was construed in its ordinary sense and in the context of the Act, not by borrowing the technical meaning it had in the Income-tax Act, because the compulsory deposit was intended to be made before assessment and to earn a deduction from the surcharge charged by the Finance Act. Reading the provision otherwise would create inconsistency between sections 4(3), 12 and 13 and would require two determinations of surcharge. The discrimination argument also failed because the petitioners were not shown to have suffered any unequal treatment; they could have made the deposit within the longer period provided by the proviso.

Conclusion: The challenge failed. Paragraph 4(1) and its first proviso were upheld, the deposit was not required to await assessment, and the petitions were dismissed.

Ratio Decidendi: Where a taxing or revenue-compulsion statute authorises a scheme to fix the time of deposit, the word "payable" must be construed contextually and in harmony with the penal and recovery provisions, so that the deposit may be required before assessment if that construction best effectuates the statutory object.

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