2001 PLP 2627 (PTD)
GORELAL DUBEY Versus COMMISSIONER OF INCOME‑TAX
| Citation | 2001 PLP 2627 (PTD) |
| Forum / Court | 248 I T R 3 |
| Bench Members | S.P. Bharucha and V.N. Khare, JJ |
| Parties | GORELAL DUBEY Versus COMMISSIONER OF INCOME‑TAX |
| Primary Law | Income‑tax‑‑‑ |
Q1: What are the key laws and sections cited in 2001 PLP 2627 (PTD)?
This judgment primarily cites: Income‑tax‑‑‑ as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2001 PLP 2627 (PTD)?
The case was heard and decided by the 248 I T R 3 bench comprising: S.P. Bharucha and V.N. Khare, JJ.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2001 PLP 2627 (PTD) (GORELAL DUBEY Versus COMMISSIONER OF INCOME‑TAX). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Representation
- Prakash Shrivastava, Advocate for Appellant.
- Dr. V. Gaurishankar, Senior Advocate (Ms. Laxmi Iyengar, Advocate with him) for Respondent.
Headnotes / Summary
(Appeal by special leave from the judgment and order, dated April 24, 1996 of the Madhya Pradesh High Court in M.C.C. No.598 of 1992). ‑‑‑‑Business expenditure‑‑‑Deduction only on actual payment‑‑‑Tax or duty‑‑ Royalty is a tax for all purposes including application of S. 43B of Income- tax Act‑‑‑Indian Income Tax Act, 1961, S.43B. The Constitution Bench judgment in the case of India Cement Ltd. v. State of Tamil Nadu (1991) 188 ITR 690 laid down the law that royalty is a tax. Therefore, it is a tax for all purposes including section 43B of the income Tax Act, 1961, and the unpaid liability for royalty for extraction of limestone cannot be deducted. CIT v. Gorelal Dubey (1998) 232 ITR 246 affirmed. India Cement Ltd. v. State of Tamil Nadu (1991) 188 ITR 690 (SC) applied. State of Madhya Pradesh v. Mahalaxmi Fabric Mills Ltd. AIR 1995 SC 2213; (1995) Supp. 1 SCC 642 and Quarry Owners' Association v. State of Bihar AIR 2000 SC 2870; (2000) 5 Scale 538 ref.
Judgment & Decree
India Cement Ltd. v. State of Tamil Nadu (1991) 188 ITR 690 (SC) applied. State of Madhya Pradesh v. Mahalaxmi Fabric Mills Ltd. AIR 1995 SC 2213; (1995) Supp. 1 SCC 642 and Quarry Owners' Association v. State of Bihar AIR 2000 SC 2870; (2000) 5 Scale 538 ref. Prakash Shrivastava, Advocate for Appellant. Dr. V. Gaurishankar, Senior Advocate (Ms. Laxmi Iyengar, Advocate with him) for Respondent. The question with which the High Court (see (1998) 232 ITR 246 (MP)) was concerned read thus (page 247): "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law to hold that the provisions of section 43B of the Income Tax Act, 1961, were not applicable to the unpaid liability towards royalty payment of Rs.76,956, since royalty was neither tax nor duty?" The High Court answered the question in the negative and against the assessee relying upon the judgments of this Court in India Cement Ltd. v. State of Tamil Nadu (1991) 188 ITR 690 and State of Madhya Pradesh v. Mahalaxmi Fabric Mills Ltd. (1995) AIR 1995 SC 2213; (1995) Supp. 1 SCC
642. The assessee is in appeal by special leave. This Court in Quarry Owners Association v. State of Bihar (2000) AIR 2000 SC 2870; (2000) 5 Scale 538 has considered afresh the submission that royalty was not a tax.. It has, however, followed the decisions in India Cement Ltd.'s case (1991) 188 ITR 690 (SC) and Mahalaxmi Fabric Mills Ltd.'s case (1995) AIR 1995 SC 2213, and explained that tax on royalty is distinct from other forms of taxes; it does not constitute usual tax as commonly understood. Learned counsel for the assessee relied upon this latest judgment to contend that royalty was not a tax within the meaning of section 43B of the Income Tax Act, 1961. It is not possible to accept the submission. The Constitution Bench judgment in India Cement Ltd. v. State of Tamil Nadu (1991) 188 ITR 690 (SC), lays down the law, namely, royalty is tax, and it is a tax for all purposes including section 43B. In the result, the judgment and order of the High Court is affirmed and the appeal is dismissed. No order as to costs. M.B.AJ933/'FC Appeal dismissed.