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2018 (5) TMI 440
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....Act of 2000') with effect from 1-11-2000 upon carving out of the new State of Chhattisgarh. The undivided Bar Council of Madhya Pradesh was availing the exemption granted by the Central Government by notification dated 9-8-1966 from taxation of its income other than those specifically excluded under Section 10(23A) of the Income Tax Act, 1961 (for short, 'the IT Act'). 3. The State Bar Council of Chhattisgarh started functioning with effect from 1-11-2000 upon reorganisation of the State of Madhya Pradesh, but did not make any application for fresh exemption under Section 10(23A) of the IT Act presumably on the ground that the notification issued by the Central Government exempting the Bar Council of Madhya Pradesh from the provisions of the IT Act under Section 10(23A), dated 9-8-1966 would also be applicable to the Bar Council of Chhattisgarh by virtue of the provisions contained in Section 2(f) read with Sections 78 and 79 of the Act of 2000. But the understanding of the State Bar Council of Chhattisgarh did not act as the order of assessment Annexure P-1 for the assessment year 2004-05 and 2005-06 came to be passed by the assessing officer of the Income Tax Depar....
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....secondly, that even though the application was made subsequently, but the Central Government partly granted the application and partly rejected by not granting exemption with effect from 1-11-2000 without assigning and any reason and without holding that the petitioner Council is not exempted from payment of tax from 1-11-2000 that is retrospective effect. Therefore, the impugned orders be set aside. 5. Return has been filed by the respondents / Income Tax Department stating inter alia that no express order has been passed by the Central Government in favour of the petitioner assessee granting exemption under the provisions of sub-section (23A) of Section 10 of the IT Act giving it retrospective effect or with effect from 1-11- 2000 and when the application was made on 4-8-2005, the application has been considered and exemption has been granted with effect from the assessment year 2006-07 and onwards, even otherwise, the order impugned is appealable under Section 246 of the IT Act. Therefore, the writ petitions cannot be entertained and are liable to be dismissed. 6. No rejoinder has been filed. 7. Mr. Neelabh Dubey, learned counsel appearing for the petitioner, would vehe....
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....r. Prasun Kumar Bhaduri, learned counsel appearing for State Bank of India / respondent No.6 in W.P.(T)No.167/2009, would submit that the order of the Income Tax authority was complied with in its letter and spirit. 10. I have heard learned counsel for the parties and considered the rival submissions made herein-above and also went through the record with utmost circumspection. 11. Prior to reorganisation of the State of Madhya Pradesh by the Act of 2000, the undivided State Bar Council of Madhya Pradesh was in existence. The Central Government in exercise of power conferred under sub-section (23A) of Section 10 of the IT Act, granted exemption to the erstwhile State Bar Council of Madhya Pradesh by notification No.37/3/66-IT(AI) dated 9-8-1966 exempting from taxation of its income other than those specifically excluded under Section 10(23A) of the Act of 1961. The notification dated 9-8-1966 has not been produced by the petitioner. However, "Law of Income Tax" authored by A.C. Sampath Iyengar (10th Edition) after Section 10(23A) of the Act of 1961 enlists Approved Bar Councils of different States including Madhya Pradesh as under: - S. No. Bar Council Notification N....
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....r names on the roll of the Bar Council of Chhattisgarh and entitlement to practice in the High Court of Chhattisgarh has also been conferred by virtue of Section 24(3) of the Act of 2000. Thus, the Bar Council of Chhattisgarh was constituted by virtue of the provisions contained in Section 24(1) of the Act of 2000 with effect from 1-11-2000. 15. The State Bar Council of Chhattisgarh so constituted would be a body corporate by virtue of the provisions contained in Section 5 of the A Act. Functions of State Bar Councils have been stated in Section 6 of the A Act, sub-section (1) of which provides as under: - "6. Functions of State Bar Councils.-(1) The functions of a State Bar Council shall be- (a) to admit persons as advocates on its roll; (b) to prepare and maintain such roll; (c) to entertain and determine cases of misconduct against advocates on its roll; (d) to safeguard the rights, privileges and interests of advocates on its roll; (dd) to promote the growth of Bar Associations for the purposes of effective implementation of the welfare schemes referred to in clause (a) of sub-section (2) of this section and clause (a) of....
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....cribed by clause (eee) is obviously charitable in nature, the same being to organise legal aid to the poor. Amongst these various obligatory functions one under clause (d) is to safeguard the rights, privileges and interests of the advocates on its roll and it is difficult to regard it as a primary or dominant function or purpose for which the body is constituted. Even this function apart from securing speedy discharge of obligations by the litigants to the lawyers ensures maintenance of high professional standards and independence of the Bar which are necessary in the performance of their duties to the society. In other words, the dominant purpose of a State Bar Council as reflected by the various obligatory functions is to ensure quality service of competent lawyers to the litigating public, to spread legal literacy, promote law reforms and provide legal assistance to the poor while the benefit accruing to the lawyer-members is incidental. ..." 17. Now, the question would be, whether the law, includes notification dated 9-8-1966 exempting the State Bar Council of M.P. under Section 10(23A) of the IT Act, applicable in the erstwhile undivided State of M.P., would be applicable ....
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....e issue as to whether in light of the Bihar Reorganisation Act, 2000, the law in force would be applicable to the State of Jharkhand, has clearly held that the law in force in the State of Bihar would be applicable in the State of Jharkhand unless modified by the competent Legislature or other competent authority. It was further held as under: - "27. ... The language in these sections is clear and unambiguous. These sections provide that the laws which were applicable to the undivided State of Bihar would continue to apply to the new States created by the Act. The laws that operated continue to operate notwithstanding the bifurcation of the erstwhile State of Bihar and creation of the new State of Jharkhand. They continue in force until and unless altered, repealed or amended. It is not disputed before us and indeed it cannot be disputed in view of the wide definition given to "law" in section 2(f) of the Act that the notification issued under section 7(3)(b) of the Bihar Finance Act, 1981 is law within the meaning of Sections 84 and 85 of the Act. Thus, the notification published in the Bihar Gazette on 22-12-1995 bearing SO No. 478 continues to operate in the State of Jh....
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.... to the fiction. When the law requires that an imaginary state of affairs should be treated as real, then unless prohibited from doing so, one must also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it. As Lord Asquith in East End Dwelling Co. Ltd. v. Finsbury Borough Council (1951) 2 All ER 587 : 1952 AC 109 (HL), All ER at p. 589 observed that having done so, you must not cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs. Section 84 bids us to imagine that despite the division of the erstwhile State of Bihar into two States, any law in force immediately before the appointed day, notwithstanding territorial references in them, shall, until otherwise provided by the competent legislature or other competent authority, be construed as meaning the territories within the existing State of Bihar before the appointed day. In simple words, though the law may refer to the State of Bihar, and though the State of Bihar has been bifurcated into two by creating the State of Jharkhand, the laws in force before the appointed d....
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....ich was in existence in the erstwhile State of M.P. exempting the State Bar Council of Madhya Pradesh under Section 10(23A) of the IT Act and would also be applicable to the State Bar Council of Chhattisgarh till it is modified or altered by the competent authority by virtue of the provisions contained in Sections 78 and 79 of the Act of 2000. 24. Reverting to the facts of the present case, it is quite vivid that the notification dated 9-8-1966 issued by the Central Government exempting the State Bar Council of M.P. from taxation of income other than those specifically excluded under Section 10(23A) of the IT Act, was applicable and was in force in the new State of Chhattisgarh with effect from 1-11-2000 and would fall within the meaning of law under Section 2(f) of the Act of 2000 and by virtue of that, the State Bar Council of Chhattisgarh was entitled to have exemption under Section 10(23A) of the IT Act from the operation of IT Act, but that was not understood properly by the Income Tax Authorities and holding that the petitioner Council is not entitled for the said exemption, the petitioner Council was assessed to income tax imposing tax liability to the extent indicated he....