Law: Income Tax Act, 1922

Section: 43B

(a) Income-tax Act (XI of 1922)---S. 43-B [as substituted by Finance Act, 1973]--Provision of S. 43-B not retrospective in its operation--Expressions "any income of any previous year" and "previous year"--Connotation. Section 43-B substituted in the Income-tax Act, 1922, by Finance Act of 1973, is not retrospective in its operation. The Finance Act of 1973 which substituted above-quoted S. 43-B in the Income-tax Act of 1922 in place of the old section was promulgated on 30th June; 1973. By reading the preamble and short title and extent contained in S.1 of Finance Act, 1973 there can be no doubt that the amendments brought about in various Acts and Ordinance by Finance Act of 1973 were meant for giving effect to the financial proposal of Federal Government for the year beginning from 1-7-1973. This being so, there is nothing in the language of the Finance Act 1973, to indicate that the legislature intended to give retrospective effect to the amendments introduced in various laws by it. In so far the phraseology "any income of any previous year" is concerned, it is same, both 111 the old as well as newly substituted section 43-B of Income-tax Act, and as such by the use of. expression "any income of any previous year" in the newly substituted section 43-B the legislature intended to bring about any change in the scheme or scope of section 43-B. A comparison of the language of old and the substituted section 43-B of the Income-tax Act, 1922 makes it abundantly clear that the scope of the newly substituted section 43-B was enlarged by including certain other category of persons who were not liable under the old section in respect of un realised tax liability of the company, while the liabilities of the directors of the company which was subject of certain limitation under the old section 43-B was also enlarged under the newly substituted section 43-B by deleting those limitations. There is, however, no indication in the language of the substituted section 43-B that these changes in the scheme and scope of scheme were to be retrospective in their operation. The expression "previous year" had a special meaning in the Income-Tax, Act 1922. An expression defined in a…

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