Kishorchand K. Bansal V. Dy. CIT (Asst.)

TAXAP/23/2001

AI Insights

The case revolves around the taxation of capital gains arising from the sale of a proprietary business, Mahavir Rolling Mill, by Kishorchand K. Bansal to Mahavir Rolling Mills Pvt. Ltd. The primary legal contention was whether the surplus realized from the sale should be taxed as short-term capital gains or long-term capital gains. The Assessing Officer initially treated the surplus as short-term capital gains, which was upheld by the CIT(A) and the Tribunal. However, the High Court, referencing decisions from the Supreme Court, particularly the case of PNB Finance Ltd. and Garden Silk Weaving Factory, found that the surplus should not be taxed under the provisions applied by the lower authorities, leading to the setting aside of their orders.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 805793 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 08-12-2014
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income v. Artex Manufacturing Co., PNB Finance Ltd. v. Commissioner of Income Tax-I, New Delhi, Commissioner of Income Tax v. Garden Silk Weaving Factory, Assessing Commissioner of Income Tax v. Patel Specific Family Trust, Commissioner of Income Tax Shahibaug Enterpreneurs Pvt. Ltd.
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: MAUNA BHATT
• Assessee Lawyers: S N SOPARKAR
• Keywords: Assessment year 1993-94; Block of assets; Capital Gains; Long Term Capital Gains; Proprietorship; Short Term Capital Gains; Slump sale
• Section: 143(3); 48; 234B; 41(2); 234C; 45; 50(2)

Judgement Text

"O/TAXAP/23/2001 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 23 of 2001 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER =========================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ KISHORCHAND K. BANSAL....Appellant(s) Versus DY. C I T (ASST.)....Opponent(s) ================================================================ Appearance: MR SN SOPARKAR, SENIOR ADVOCATE for the Appellant(s) No. 1 MRS MAUNA M BHATT, ADVOCATE for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER Date : 08/12/2014 ORAL JUDGMENT Page 1 of 22 O/TAXAP/23/2001 JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. By way of this appeal, the appellant- revenue has challenged the order dated 14.08.2000 passed by the Income Tax Appellate Tribunal, Ahmedabad Bench ‘A, Ahmedabad [ for short “the Tribunal”] in ITA No.5108/Ahd/1996, whereby the appeal filed by the appellant-assessee was partly allowed by the Tribunal only for the statistical purposes. 2. The facts, in brief, are that the assessee-proprietor of Mahavir Rolling Mill, filed its return for the Assessment Year 1993-94 on 31.10.1993 and declared income at Rs.16,02,665/-. It is pertinent to note that the propertiery business of the assessee was run upto 31.08.1992. On 1.9.1992, the business was sold to Mahavir Rolling Mills Pvt. Ltd. by an agreement for a consideration of Rs.86,21,000/-. The capital account was worked out, which arose on account of the said transfer. The Balance sheet of the propertory concerned was worked out on 31.08.1992 and on that basis, the capital account was arrived at Rs.48,35,773/-. Thereafter, the Assessing Officer, passed order under Section 143(3) on 29.3.1996 and made an addition of Rs.48,35,733/- holding that the appellant is liable to short term capital gains. In the said assessment order, the Assessing Officer also made Page 2 of 22 O/TAXAP/23/2001 JUDGMENT an addition of Rs.9,001/- relating to motor car expense. 2.1. Against the order of the Assessing Officer, the appellant filed an appeal before the Commissioner of Income Tax. The CIT(A) after going through the facts of the case and the case law relied upon by the assessee held that the order passed by the Assessing Officer was correct in so far as levy of capital gain is concerned. However, the CIT(A) held that a part of the gain was long term capital gain and the assessee is liable to pay tax on capital gains accordingly. The CIT(A) confirmed the addition of motor car expense made by the Assessing Officer. 2.2. Being aggrieved and dissatisfied with the order of the CIT(A), the assessee again filed an appeal before the Tribunal. The Tribunal upheld the order of the CIT(A) and held that the appellant was liable to long term capital gains. Hence this appeal is filed at the instance of the assessee. 3. While admitting these appeals, the Court had formulated the following substantial questions of law:- 1. Whether on the facts and in the Page 3 of 22 O/TAXAP/23/2001 JUDGMENT circumstances of the case, the Tribunal has substantially erred in law in holding that the excess on sale of the business undertaking realized on sale of fixed asset is liable to be taxed as gains 2. Whether on the facts and in circumstances of the case, the has substantially erred in law in appreciating that as cost of the undertaking was incapable of determined, the computation of gain was impossible and, therefore, tax was leviable on the alleged surplus ?” 3. Whether on the facts and in circumstances of the case, the has substantially erred in law in appreciating that a business is an asset independent of and from individual assets which make up an undertaking and, therefore,merely because cost of some such assets might be available, the same would not be equivalent to the cost of the business undertaking so as to levy capital tax ? 4. Whether on the facts and in the Page 4 of 22 O/TAXAP/23/2001 JUDGMENT circumstances of the case, the Tribunal has substantially erred in law in not holding that the interest under Sections 234B and 234C was rightly charged then the same was not by specific sections referred to in the assessment order ?” 4. Mr. Soparkar, learned senior advocate for the appellant-assessee has taken us through paragraph 5.16 of the order of the Assessing Officer, which reads as under:- “5.16. It must be stated that the surplus worked out by the assesee on transfer of his properietory concern is on account of block of assets which were the property of his propietory business. In the computation sheet, filed alongwith the return, the assessee has worked out the amount of capital gain as under:- Total realization for the sale of Mahavir Rolling Mill 86,21,000 less: Towards net current assets Total assets (except fixed assets) 281632,24 Less; Total liabilities 27195415 9,67,809 76,53,1921 W.D.V. As per I.T. Act for A.Y. 1992-93 2867418 Less: Sale consideraiton of Maruti 50000 28,17,418 48,35,773 Page 5 of 22 O/TAXAP/23/2001 JUDGMENT 4.1. Learned senior advocate for the appellant-assessee contended that the calculation made by the Assessing Officer is contrary to paragraph No.5.16 of his order as the Assessing Officer has concluded that Rs.48,35,773/- is a short term capital gain. 4.2. He further submitted that before the Assessing Officer, the assesseee vide letter dated 28.2.1996 submitted that “since there is no itemised said of any asset, there is no sale proceeds for individual item comprised in the “going concern” and for this reason, the excess of the sale proceeds over the net assets of the proprietor-ship unit has been treated as long- term capital gains”. However, the Assessing Officer has not accepted the said request of the assessee. 4.3. Mr. Soparkar, learned senior advocate for the appellant-assessee has submitted that the Tribunal has passed its order on the basis of the decision of the Apex Court in the case of Commissioner of Income v. Artex Manufacturing Co. reported in 227 ITR 260. 4.4. Learned senior advocate for the appellant-assessee has relied upon the following decisions in support of his contentions:- Page 6 of 22 O/TAXAP/23/2001 JUDGMENT (i) In the case PNB Finance Ltd. v. Commissioner of Income Tax-I, New Delhi, reported in 307 ITR 75(SC). (ii) In the case of Commissioner of Income Tax v. Garden Silk Weaving Factory, reported in [2005] 279 ITR 136. (iii) In the case of Assessing Commissioner of Income Tax v. Patel Specific Family Trust, reported in [2011] 330 ITR 297 (Gujarat) 4.5. By making such submissions, learned senior advocate for the appellant-assessee has urged that this Court may allow the present appeal and answer the questions raised in this appeal in favour of the assessee and against the revenue. 5. Mr. Bhatt, learned senior advocate for the respondent-revenue has strongly relied on the decision of the Apex Court in the case of Commissioner of Income v. Artex Manufacturing Co. reported in 227 ITR 260, wherein it has been held that (i) “the assessee could not be taxed as a “registered firm” and had to be taxed in the status of a “body of individuals”, (ii) that in Page 7 of 22 O/TAXAP/23/2001 JUDGMENT the agreement of sale, there was no reference to the information that was furnished by the assessee before the Income-tax Officer it became evidence that the amount of Rs.11,50,400 had been arrived at by taking into consideration the value of the plant, machinery and dead stock as assessed by the valuer at Rs.15,87,296/-. Section 41(2) was applicable. (iii) that the liability under Section 41(2) was limited to the amount of surplus to the extent of the difference between the written down value and the actual cost. If the amount of surplus exceeded the difference between the written down value and the actual cost, then the surplus amount to the extent of such excess would have to be treated as capital gains for the purpose of taxation. The Tribunal has not considered this matter. (iv) that on the question relating to the two circulars of the Central Board of Direct Taxes, the Tribunal had stated that one of the circulars related to the tax liability of surplus in the case of nationalized banks and it had no application to the present case and that the second circular was based on the decision of Mugneeram Bangus [1965] 57 299 (SC), and since the said case dealt with the provisions of Section 10(2)(vii), proviso (ii), of the 1922 Act prior to amendment, the said circular had no application and that the matter was governed by the decision in B.M. Page 8 of 22 O/TAXAP/23/2001 JUDGMENT Kharwar [1969] 72 ITR 603 (SC). The view of the Tribunal was correct. 5.1. Mr. Bhatt, learned senior advocate also relied upon the decision of the Apex Court in the case of Goetze India Ltd. v. Commissioner of Income Tax, reported in [2006] 284 322, more particularly paragraph Nos. 3 and 4, which read as under:- “3. This appellant’s appeal before the Commissioner of Income-tax (appeals) was allowed. However, the order of the further appeal of the Department before the Income tax appellate Tribunal was allowed. The appellant has approached this Court and has submitted that the Tribunal was wrong in upholding the Assessing Officer’s order. He has relied upon the decision of this Court in National Thermal Power Company Ltd. v. CIT [1998] 229 ITR 383, to contend that it was open to the assessee to raise the points of law even before the Appellate Tribunal. 4. The decision in question is that the power of the Tribunal under Section 254 of the Income Tax Act, 1961, is to entertain for the first time a point of law provided the fact on the basis of which the issue of law can be raised before the Tribunal. The decision does not in any way relate to the power of the Assessing Officer to entertain a claim for deduction otherwise than by filing a revised return. In the circumstances of the case, we dismiss the Civil appeal. However, we make it clear that the issue in this case is Page 9 of 22 O/TAXAP/23/2001 JUDGMENT limited to the power of the assessing authority and does not impinge on the power of the Income Tax Appellate Tribunal under Section 254 of the Income Tax Act, 1961. There shall be no order as to costs.” 5.2. Thereafter, Mr. Bhatt, learned senior advocate for the respondent-revenue relied upon the decision of this Court in the case of Commissioner of Income Tax Shahibaug Enterpreneurs Pvt. Ltd. reported in [2001] 251 ITR 433, wherein it is held that in CIT v. Artex Manufacturing Co. [1997] 227 ITR 260, the apex Court has held that even if in the agreement there is no reference to the value of the plant, machinery and dead stock, if on the basis of the information that is made available to the Income-tax Officer, it becomes evident that the plant, machinery and dead stock was sold at a price higher than the book value of the plant machinery and dead stock, the provisions of section 41(2) of the Act are applicable. As rightly noted by the Income tax Officer and the Appellate Assistant Commissioner, when the undertakings in question like Swastik Oil Mills were incurring huge loses, its units could not have been sold at price of Rs.2,45 crores when the written down value of its assets other than good-will was only about Rs.45 lakhs. The Appellate Assistant Commissioner was fully justified in remanding the matter to the Income Page 10 of 22 O/TAXAP/23/2001 JUDGMENT Tax Officer for determining the correct valuation of the good-will as the good-will determined by the assessee was at an exaggerated figure for the loss making undertaking. Since the order of the Appellate Assistant Commissioner was only an order of remand requiring the Income tax Officer to determine the value of the good-will by applying the correct principles of accountancy, there was no warrant for the Tribunal to interfere with the said order. Moreover, even if the assessee was not in a position to give the particulars about the market value of various assets, it was certainly open to the assessee to point out the actual cost of the assets and the difference between the written down value and the actual cost was liable to be taxed as balancing charge under section 41(2). 5.3. Mr. Bhatt, learned senior advocate has drawn our attention to Section 48 of the Income Tax Act, which reads as under:- “48. The income chargeable under the head “Capital gains” shall be computed, by deducting from the full value of the consideration43 received or accruing as a result of the transfer of the capital asset the following amounts, namely :— (i) expenditure incurred wholly and exclusively in connection with such transfer; Page 11 of 22 O/TAXAP/23/2001 JUDGMENT (ii) the cost of acquisition of the asset and the cost of any improvement thereto: Provided that in the case of an assessee, who is a non-resident, capital gains arising from the transfer of a capital asset being shares in, or debentures of, an Indian company shall be computed by converting the cost of acquisition, expenditure incurred wholly and exclusively in connection with such transfer and the full value of the consideration received or accruing as a result of the transfer of the capital asset into the same foreign currency as was initially utilised in the purchase of the shares or debentures, and the capital gains so computed in such foreign currency shall be reconverted into Indian currency, so, however, that the aforesaid manner of computation of capital gains shall be applicable in respect of capital gains accruing or arising from every reinvestment thereafter in, and sale of, shares in, or debentures of, an Indian company : Provided further that where long-term capital gain arises from the transfer of a long-term capital asset, other than capital gain arising to a non-resident from the transfer of shares in, or debentures of, an Indian company referred to in the first proviso, the provisions of clause (ii) shall have effect as if for the words “cost of acquisition” and “cost of any improvement”, the words “indexed cost of acquisition” and “indexed cost of any improvement” had respectively been substituted : Provided also that nothing contained in Page 12 of 22 O/TAXAP/23/2001 JUDGMENT the second proviso shall apply to the long-term capital gain arising from the transfer of a long-term capital asset being bond or debenture other than capital indexed bonds issued by the Government :] Provided also that where shares, debentures or warrants referred to in the proviso to clause (iii) of section 47 are transferred under a gift or an irrevocable trust, the market value on the date of such transfer shall be deemed to be the full value of consideration received or accruing as a result of transfer for the purposes of this section ] [Provided also that no deduction shall be allowed in computing the income chargeable under the head “Capital gains” in respect of any sum paid on account of securities transaction tax under Chapter VII of the Finance (No. 2) Act, 2004.] Explanation.— For the purposes of this section,— (i) “foreign currency”48 and “Indian currency”48 shall have the meanings respectively assigned to them in section 2 of the Foreign Exchange Regulation Act, 1973 (46 of 1973); (ii) the conversion of Indian currency into foreign currency and the reconversion of foreign currency into Indian currency shall be at the rate of exchange prescribed in this behalf; (iii) “indexed cost of acquisition” Page 13 of 22 O/TAXAP/23/2001 JUDGMENT means an amount which bears to the cost of acquisition the same proportion as Cost Inflation Index for the year in which the asset is transferred bears to the Cost Inflation Index for the first year in which the asset was held by the assessee or for the year beginning on the 1st day of April, 1981, whichever is later; (iv) “indexed cost of any improvement” means an amount which bears to the cost of improvement the same proportion as Cost Inflation Index for the year in which the asset is transferred bears to the Cost Inflation Index for the year in which the improvement to the asset took place; (v) “Cost Inflation Index”, in relation to a previous year, means such Index as the Central Government may, having regard to seventy-five per cent of average rise in the Consumer Price Index for urban nonmanual employees for the immediately preceding previous year to such previous year, by notification50 in the Official Gazette, specify, in this behalf. 5.4. Mr. Bhatt, learned senior advocate has also drawn our attention to Section 50(2) of the Income Tax Act, which reads as under:- “50.(2) where any block of assets ceases to exist as such, for the reason that all the assets in that block are transferred during the previous year, the cost of acquisition of the block of assets shall be the written down value of the block of assets at the beginning Page 14 of 22 O/TAXAP/23/2001 JUDGMENT of the previous year, as increased by the actual cost of any asset falling within that block of assets, acquired by the assessee during the previous year and the income received or accruing as a result of such transfer or transfers shall be deemed to be the capital gains arising from the transfer of short-term capital assets.” 5.5. By making aforesaid submissions, learned advocate for the respondent-revenue has submitted that this Court may dismiss this appeal and confirm the impugned order of the Tribunal. 6. We have heard learned senior advocates appearing for both the parties and perused the material on record. We have also minutely perused the decisions relied upon by the learned senior advocates appearing for both the parties. The question Nos. 1 and 2 are required to be answered together as they are inter-connected. It appears that the Tribunal had passed its order on basis of the decision of the Commissioner of Income v. Artex Manufacturing Co. reported in [1997]227 ITR 260. However, in view of the subsequent decision of the Apex Court in the case of PNB Finance Ltd. (supra), relied upon by the learned senior advocate for the appellant-assessee, the question Nos. 1 and 2 are required to be answered in favour of the assessee and against the revenue. Page 15 of 22 O/TAXAP/23/2001 JUDGMENT The Apex Court in paragraph No.17 of the aforesaid decision held as under:- “17. As regards applicability of Section 45 is concerned, three tests are required to be applied. In this case, Section 45 applies. There is no dispute on that point. The first test is that the charging section and the computation provisions are inextricably linked. The charging section and the computation provisions together constituted an integrated Code. Therefore, where the computation provisions cannot apply, it is evident that such a case was not intended to fall within the charging section, which, in the present case, is Section 45. That section contemplates that any surplus accruing on transfer of capital assets is chargeable to tax in the previous year in which transfer took place. In this case, transfer took place on 18.7.1969. The second test which needs to be applied is the test of allocation/attribution. This test is spelt out in the judgment of this Court in Mugneeram Bangur & Co. (supra). This test applies to a slump transaction. The object behind this test is to find out whether the slump price was capable of being attributable to individual assets, which is also known as item-wise earmarking. The third test is that there is a conceptual difference between an undertaking and its components. Plant, machinery and dead stock are individual items of an Undertaking. Business Undertaking can consists of not only tangible items but also intangible items like, goodwill, man power, tenancy rights and value of Page 16 of 22 O/TAXAP/23/2001 JUDGMENT banking licence. However, the cost of such items (intangibles) is not determinable. In the case of CIT v. B.C. Srinivasa Setty reported in (1981) 128 ITR 294, this Court held that Section 45 charges the profits or gains arising from the transfer of a capital asset to income-tax. In other words, it charges surplus which arises on the transfer of a capital asset in terms of appreciation of capital value of that asset. In the said judgment, this Court held that the \"asset\" must be one which falls within the contemplation of Section 45. It is further held that, the charging section and the computation provisions together constitute an integrated Code and when in a case the computation provisions cannot apply, such a case would not fall within Section 45. In the present case, the Banking Undertaking, inter alia, included intangible assets like, goodwill, tenancy rights, man power and value of banking licence. On facts, we find that item-wise earmarking was not possible. On facts, we find that the compensation (sale consideration) of Rs. 10.20 cr. was not allocable item-wise as was the case in Artex Manufacturing Co. (supra).” 7. The aforesaid two questions also came for interpretation in the of Garden Silk Factory (supra). Wherein in paragraph Nos. 4, 7, 8 and 10 of the said decision, the Court had held as under:- “4 Mr.Tanvish U.Bhatt, learned Standing Counsel appearing on behalf of the applicant revenue assailed the order of the Tribunal primarily on the ground Page 17 of 22 O/TAXAP/23/2001 JUDGMENT that the Assessing Officer had taken the details which are available on record to compute the balancing charge under section 41(2) of the Act and the Tribunal had wrongly read the agreements between the assessee firm and the limited company to hold that there was transfer of the entire business as a going concern. Alternatively, relying on the decision of Apex Court in the case of CIT Vs. Artex Manufacturing Company (1997) 227 ITR 260 it was contended that even if the transaction was regarded as slump sale on the basis of information that was available with the Assessing Officer the assessee had rightly been held to be taxable under section 41(2) of the Act. He also cited decision of this Court rendered in the case of CIT vs. Shahibaug Entrepreneurs Pvt.Ltd. (2001) 251 ITR 433 to submit that even this Court had read and applied the decision of the Apex Court in case of Artex Manufacturing Company (supra) in the manner revenue was contending. He therefore urged that the Tribunal's order was required to be set aside and the order of Assessing Officer restored. 7. The Assessing Officer by relying on the deed of assignment executed on 17/8/1973 has worked out the surplus liable to tax under section 41(2) of the Act by adopting following figures. The Tribunal has extracted the said portion in paragraph 2 of its order: “In this deed, it was inter-alia mentioned that value of all the assets taken over by the company was determined at Rs.77,37,579/- comprising of the following items : Page 18 of 22 O/TAXAP/23/2001 JUDGMENT (a) Rs.3,76,000 Value of building structure at Bella Mill Compound. b) Rs. 45,837 Being value of goodwill of the firm. (C) Rs.44,80,984 Being the value of plant & machinery and equipment of Rampura Unit and of Bell Mill Compound Units, furniture and the value of stock-in-trade. (d) Rs.28,34,758 Aggregate value of loss, advance, cash, bank balance,investment etc. : Rs.77,37,579 total Rs.62,22,579 Less : liabilities taken over Rs.15,15,000 8. On going through the aforesaid figures it is apparent that the Assessing Officer had adopted the aggregate values of the building structure as well as plant and machineries, furniture and stock in trade. On a plain reading of Section 41(2) of the Act it becomes clear that for the purpose of invoking the said section it is necessary that each individual asset, be it a building or plant or machinery, has to be (a) owned by the assessee, (b) used for the purpose of business of the assessee, (c) should have written down value and actual cost, and (d) there should be excess which does not exceed the difference between the actual cost and the written down value which shall be chargeable to tax as income of the business of the previous year in which monies payable for such building, Page 19 of 22 O/TAXAP/23/2001 JUDGMENT machinery, plant or furniture became due. Therefore, for each asset which is sold the Assessing Officer must have with him the actual cost, WDV and the sale consideration. In absence of the same, Section 41(2) of the Act cannot be applied. In a case like the present one where the entire business is sold as a going concern with all assets and liabilities it is apparent that the provision cannot be invoked unless and until the aforesaid information is available with the Assessing Authority. It is in this context that the ratio of the Apex Court's decision in case of CIT Vs. Artex Manufacturing Company (supra) has to be appreciated and applied when it is observed that provision of Section 41(2) of the Act can be applied on the basis of the information that may be available with the Assessing Officer. 10 Before parting it is necessary to take note of the fact that Supreme Court itself has in similar fact situation in the case of CIT vs. Electric Control Gear Mfg. Co. (1997) 227 ITR 278 distinguished its own decision in Artex Manufacturing Company by holding that there was nothing to indicate that the price attributable to the assets like machinery, plant or building out of the total consideration amount and merely because depreciation had been allowed, it could not be said that the balance was the excess amount between the price and the written down value.” 8. Considering the facts of the case and the subsequent principle laid down in the case of PNB Finance Ltd (supra) and Garden Silk Weaving Page 20 of 22 O/TAXAP/23/2001 JUDGMENT Factory (supra), we are of the considered opinion that the question Nos. 1 and 2 posed in this appeal are required to be answered in favour of the assessee and against the revenue. 9. Insofar as the issue No.3 is concerned, the same is also required to be answered in favour of the assessee in view of paragraph No.17 of the decision of the Apex Court in the case of PNB Finance Ltd.(supra). 10. So far as the fourth question being the last question, is concerned, since the questions Nos. 1, 2 and 3 are held in favour of the assessee the charge of interest under Section 243B and 243C does not arise for the purpose of capital gain. Therefore, the same is also required to be answered in favour of the assessee and against the Revenue. 11. In view of the above, the present appeal stands allowed. Accordingly, the questions of law posed in this appeal are answered in favour of the assessee and against the revenue. The orders of all the authorities i.e. the Assessing Officer, CIT(A) and Tribunal are hereby quashed and set aside. (K.S.JHAVERI, J.) Page 21 of 22 O/TAXAP/23/2001 JUDGMENT (K.J.THAKER, J) pawan Page 22 of 22 "