Law:

Section:

Section 8A of the Taxation of Income (Investigation Commission) Act, 1947 - Settlement of tax in arrears - Income-tax Investigating Commission determined amount of income-tax payable by petitioner on undisclosed income - Petitioner agreed to pay aforesaid tax in instalments under terms of settlement and also agreed that in case of default in payment of any one of instalments, whole amount of tax outstanding would become immediately payable - Accordingly, a demand notice was issued upon him allegedly on 2-12-1949 - Subsequently, when petitioner failed to make full payment of income-tax dues in accordance with terms of settlement, certain properties belonging to him and his family were attached towards aforesaid payments - On writ, petitioner challenged legality of demand notice on ground that he had allegedly, received notice of demand in or about April, 1950 and after coming into force of Constitution of India on 26-1-1950, demand notice could not be given effect - It was further contended that proceedings taken in pursuance of that notice were unconstitutional inasmuch as they violated his fundamental rights guaranteed by Constitution - Whether, since, on basis of material on record, it was clear that proceedings against petitioner culminating in service of notice of demand were all completed before coming into force of Constitution, petitioner could not challenge said proceedings under article 14 as Constitution is prospective and not retrospective - Held, yes - Whether, further, in view of fact that procedure of recovery of arrears of tax initiated against petitioner under section 8A(2) was one and same for all members who fell in petitioner's class, objection raised by petitioner that he had been subjected to discriminatory procedure after coming in to force of Constitution, could not be accepted - Held, yes Whether, therefore, recover proceedings were rightly initiated in accordance with section 8A(2) - Held, yes FACTS The Income-tax Investigation Commission determined the amount of tax payable by the petitioner on the undisclosed income. On 7-11-1949, the petitioner, his wife and two sons submitted a petition to the Commission in which they accepted the…

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