1954 (11) TMI 59

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....lant and machinery to the extent of Rs. 1,26,098 in the income, profits and gains of the assessee firm in the assessment for 1951-52 under the second proviso to section 10(2)(vii) of the Income Tax Act. Two questions were agitated before the Tribunal in appeal, one concerning the taxable quantum and the other concerning the validity of the proviso under which the assessment was made. The Tribunal found in favour of the assessee in regard to the quantum of the addition and reduced the addition to a sum of Rs. 86,854. They were unable to hold, however, that the impugned proviso was invalid or inoperative in the eye of law. At the request of the assessee the Tribunal have referred two questions of law for the decision of this Court, name....

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.... or destroyed, the amount by which the written down value thereof exceeds the amount for which the building, machinery or plant, as the case may be, is actually sold or its scrap value : Provided further that where the amounts for which any such building, machinery or plant is sold, whether during the continuance of the business or after the cessation thereof, exceeds the written down value, so much of the excess as does not exceed the difference between the original cost and the written down value shall be deemed to be profits of the previous year in which the sale took place :......" Two submissions have been placed before us in support of the contention that the second proviso is void and of no effect. It is stated in the fir....

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....se two provisions are complementary to each other; they can stand together and can by no stretch of language be regarded as inconsistent with or repugnant to each other. Again, it was contended that as the principal function of a proviso is to except something from the enacting clause and not to extend or enlarge the operation of the statute, neither the Department nor the Tribunal are justified in construing the proviso in question as imposing a liability. It is true that ordinarily a proviso is designed to restrict rather than to enlarge the provision to which it is appended but this is not an inflexible rule and there are cases in which the language might well lead one to the conclusion that the Legislature intended to exercise its en....