TaxTMI 
TaxTMI 
1987 (4) TMI 2
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.... the assessment year 1962-63, which is the year with which this appeal is concerned, the assessee made a profit of Rs. 58,102 from speculation business. In the assessment proceedings for that year, the assessee claimed that the loss of Rs. 60,054 suffered in respect of the assessment year 1960-61 and the loss of Rs. 6,839 suffered in respect of the assessment year 1961-62 should be set off against this speculation profit of Rs. 58,102 for this year. If that had been done, the speculation profits of the year under consideration would have been absorbed completely by the losses brought forward from the preceding years. The Income-tax Officer, however, rejected the assessee's claim. He held that as the assessee was a registered firm, the losses could be carried forward and set off only by the partners and not by the firm. The appeal by the assessee before the Appellate Assistant Commissioner was dismissed. The assessee went up in appeal to the Tribunal. The Tribunal held that the right to carry forward the losses relating to the assessment years 1960-61 and 1961-62 was governed by the Indian Income-tax Act, 1922 (hereinafter called the " 1922 Act ") and that section 75(2) of the In....
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.... of income could be carried forward in the manner indicated therein. So, therefore, the 1922 Act gave a right to set off speculation losses against the speculation profits and to the extent it was unabsorbed, it had a right to carry forward the losses for the future years to be set off against speculation profits of future years. It was admitted that in a way it was a vested right-a right on assessment to set off the losses against the profits of the year in question and if not fully absorbed, to carry it forward to be set off against the profits of future years. It was submitted on behalf of the Revenue that it, therefore, continued so long as the Act permitted the setting off in that manner. It was, however, urged that in view of the coming into operation of the 1961 Act which came into operation on 1st of April, 1962, that right no longer was there with the assessee. Section 75 of the 1961 Act provided an entirely new scheme. It was as follows: " 75. Losses of registered firms.-(1) Where the assessee is a registered firm, any loss which cannot be set off against any other income of the firm shall be apportioned between the partners of the firm, and they alone shall be entitle....
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....to set off its speculation losses, which have been carried forward, against the speculation profits of the firm, the right, if any, created by section 24(2) could not be said to remain intact after the repeal of the 1922 Act. Speculation losses of years anterior to 1962-63 could not, therefore, be carried forward and set off against speculation profits of a registered firm. The Allahabad High Court, considering the decision of this court in State of Punjab v. Mohar Singh, AIR 1955 SC 84, observed that the principle laid down by this court was that where the repealing provision indicated the effect of repeal on previous matters and provided for the operation of the previous law in part and in negative terms as also for the operation of the new law in other part in positive terms, the repealing and the saving provision could be said to be a self-contained Act. While we respectfully agree with the principle applicable in interpreting the application of the Act, we are of the opinion that the Allahabad High Court was not right in the application of that principle in the light of section 297(2) of the 1961 Act in the aforesaid decision. There is nothing in any of the clauses of sub-sect....
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....nd, if so, to what extent. This court in Karimtharuvi Tea Estate Ltd. v. State of Kerala [1966] 60 ITR 262, observed that it was well-settled that the Income-tax Act as it stands amended on the first day of April of any financial year must apply to the assessment of that year. Any amendments in that Act which came into force after the first day of April of a financial year, would not apply to the assessment for that year, even if the assessment was actually made after the amendments came into force. There, the Kerala Surcharge on Taxes Act, 1957, having come into force on September 1, 1957, being the date appointed by the Kerala Government under section 1(3) of the Act, and not being retrospective in operation, by express intendment or necessary implication, could not be made applicable from April 1, 1957. Since the Act was not the law in force on April 1, 1957, no surcharge on agricultural income-tax could be levied under that Act in respect of the assessment year 1957-58. That decision had also not dealt with the question of affecting vested rights. In our opinion, the right given to the assessee for the assessment year 1961-62 under section 24(2) of the 1922 Act was an acc....
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....ssessee would have been entitled to get the relief as granted by virtue of section 25(3) of the 1922 Act. It was observed that on a reading of section 6 of the General Clauses Act, 1897, it was clear that unless contrary intention appears, the repeal of an Act does not affect any existing right, privilege, obligation or liability. It is, therefore, necessary to find out from the provisions of section 297 of the 1961 Act which repeals the 1922 Act, whether the old rights and liabilities have been intended to be destroyed. There was no corresponding provision under the 1961 Act dealing with the type of claims mentioned in sub-section (3) or (4) of section 25 of the 1922 Act. It was contended by the Revenue that what was not said was destroyed and such intention would be apparent in that case from section 297(2)(h) of the 1961 Act. The High Court referred to the 12th Report of the Law Commission, and speaking for the court, one of us (Sabyasachi Mukharji J.) said that it was not possible to accept the submission for the Revenue that whatever was not said was destroyed. The court reiterated that there must be a manifest intention of Parliament to destroy a right or privilege under the ....