Law:

Section:

Section 11(14) of the Finance Act, 1946 - Excess Profits Tax - Refund Of - Assessment year 1963-64 - Assessee, a non-resident company, received refund of post war excess profits tax in United Kingdom - Whether amount in question was assessable and was liable to be included in income of assessee under section 11(14) - Held, yes FACTS The assessee, a non resident company, received refund of post was excess profits tax in the United Kingdom. The Income-tax Officer invoked the provisions of section 11 which provided that the excess profits tax refund was to be deemed as income, for the purposes of the Indian Income-tax Act, 1922. The AAC having found that the Indian Income-tax Act, 1922, was repealed by the Income-tax Act, 1961, and the assessment year under consideration was governed by the Income-tax Act, 1961, held that although the excess profits tax refund was taxable under the Indian Income-tax Act, 1922, the same was not taxable under the Income-tax Act, 1961, because, there was no saving cause in the income-tax Act, 1961, on this account. The AAC further held that the assessee being a non-resident company and the post-war excess profits tax refund having been received in the United Kingdom, the same was not assessable under the Income-tax Act, 1961. The Tribunal upheld the order of the AAC. On reference : HELD The AAC had considered the question of assessability of the amount in question by reference to sub-section (11) of section 11. That was not, however, the appropriate section because that sub-section dealt with the refund of excess profits tax paid under the Indian Finance Act, 1942, or excess profits tax in respect of the payments made in India. In respect of the excess profits tax payable under the law in force in the United Kingdom the appropriate provision was sub-section (14) of section 11. The fact that the AAC had referred to wrong sub-section would not debar the court from examining the question by reference to the proper sub-section of the Act, if that was possible without investigation of any fresh facts. In the instant case, no question of any fresh facts arose. It was apparent that sub-section (14) of section 11 clearly by the operation of…

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