ABHAY RAM vs COMMISSIONER OF INCOME TAX.

The Tribunal (Delhi Bench C New Delhi) referred the following question for the opinion of this Court :

"Whether the amendment of s. 64(1)(iii) of the IT Act coming weft. 1st April, 1976 could be applicable for asst. yr. 1976-77 in the case of the applicant-assessee and particularly for the Accounting period ending on 30th September, 1975".

Assessment year relevant in this case is 1976-77 for which the accounting period ended on 30th September, 1975. The contention of the assessee is that income having accrued upto 30th September, 1975 cannot be brought to tax under s. 64(1)(iii) of the IT Act, 1961, which came into force weft. 1st April, 1976.

The question is as to which law will apply to the facts of this case. In Reliance Jute and Industries Ltd. Vs. Commissioner of Income Tax, West Bengal, the Supreme Court held that it is a cardinal principle of the tax law that the law to be applied is that in force in the assessment year, unless otherwise provided expressly or by necessary implication. Sec. 64(1)(iii) came into force on the first day of the assessment year and, therefore, that being the law throughout the assessment year would be applicable. It is not shown by counsel for the assessee that anything was otherwise provided either expressly or by necessary implication to exclude the above cardinal principle of law. We, are, therefore, of the view that the view taken by the Tribunal fully accords the legal position and hence the aforementioned question is decided in the affirmative, that is, in favour of the Revenue and against the assessee.