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IN THE HIGH COURT OF BOMBAY
Chagla, C.J. and P.V. Dixit, J.
Appellants: Jethalal Nagji Shah
Vs.
Respondent: Municipal Corporation for Greater Bombay
First Appeal Nos. 481 and 482 of 1952. F.A. No. 481 of 1952
Decided On: 17.06.1953
Counsels:
For Appellant/Petitioner/Plaintiff: M.V. Desai, Adv.
For Respondents/Defendant: G.A. Thakkar, Adv.
B.Notice - Section 80 of Code of Civil Procedure - third party notice served - the only defence which the Union seems to have is a very technical defence under Section 80 - it would not be proper for the Union of India to refuse to pay the Municipality the amount which in law it is entitled to merely on the ground that no proper notice was given under Section 80. ( para 16)
Extract of Judgement : Now, the principle has been fairly well established that if you have a prior Act and the Legislature passes a subsequent Act and the Legislature wishes to incorporate into the subsequent Act certain provisions of the prior Act, the Legislature instead of bodily incorporating all those provisions may incorporate them merely by reference. This the Legislature does for convenience. But the incorporation in the sub-sequent Act makes the incorporation such a part of the subsequent Act as if it had been expressly put in that subsequent Act. Once the provisions of the prior Act have been incorporated into the subsequent Act, those provisions have, as it were, an independent existence and that existence is in no way affected by the fate of those provisions in the prior Act, whether the prior Act is repealed or the prior Act is modified.(Para 6)
suit decree in favour of plaintiff -
1. This is an appeal from a judgment of Mr. Hathi, Judge of the City Civil Court, Bombay, by which he dismissed the plaintiffs suit. The suit came to be filed under the following circumstances.
2. One Rowji Sojpal entered into a contract with defendant No. 1, the Municipal Corporation of Bombay, for construction of certain sewers and admittedly under that contract a sum of Rs. 14,517-10-0 was due by the Muncipality to Rowji Sojpal on March 31, 1950. On March 20, 1950, Rowji Sojpal on March 31, 1950. On March 20, 1950, Rowji Sojpal assigned the benefit under this contract to the plaintiff and the plaintiff has sued the Muncipality to recover this sum of Rs. 14,517-10-0. The Municipality does not dispute its liability under the contract. Its defence is that it made this payment to the Union of India under a notice served by the Excess Profits Tax Officer on April 29, 1950, and the payment was made on May 5, 1950. The contention of the Municipality is that this payment discharges the Municipalitys debt to Rowji Sojpal and therefore the plaintiff is not entitled to use on the assignment. The trial Judge upheld the contention of the Municipality and dismissed the suit. A third party notice was also taken out against the Union of India claiming this sum of Rs. 14,517-10-0 in the event of the court holding that the payment made by the Municipality to the Union of India was unjustified. No question arose with regard to the decision on the third party notice in view of the decision of the trial court that the plaintiff was not entitled to sue the Municipality, but the learned Judge held that in the event of the appellate court taking a different view the third party notice was bad inasmuch as no notice was given to the Union of India by the Municipality under Section 80 of the Code of Civil Procedure.
3. It seems that a sum was due by Rowji Sojpal for excess profits tax and the Municipality being the debtor of Rowji Sojpal, th e Excess Profits Tax Officer called upon the Municipality to pay the sum of Rs. 14,517-10-0 towards the liability of Rowji Sojpal for excess profits tax. This demand was made under Section 21 of the Excess Profits Tax Act, and the question is whether this demand was justified in law. Section 21 of the Excess Profits Tax Act makes certain sections of the Indian Income-tax Act, 1922, applicable with such modifications, if any, as may be prescribed and the mode of bringing about these modifications is by making rules under the rule-making power conferred under Section 27 upon the Central Board of Revenue. In making these provisions of the Indian Income-tax Act applicable Section 21 specifically states that these sections shall apply as if the provisions of those sections were provisions of the Excess Profits Tax Act, and one of the sections which is made applicable is Section 46 with which we are concerned in this case. Section 46 deals with the mode of recovery of income-tax and the first four sub-section of that section deal with the mode of recovery through the Collector. Sub-section (5) provides for a different mode of recovery and that mode is where an assessee is in receipt of any income chargeable under the head "Salaries", the Income-tax Officer is given power to require any person who has to pay the salary to deduct from the payment of the salary any amount which is due for arrears of income-tax. Now, under the rules framed under Section 21 which authorised the Central Board of Revenue to make modifications in the sections of the Indian Income-tax Act made applicable to the Excess Profits Tax Act sub-section (5) of Section 46 was deleted. Therefore, as far as the Excess Profits Tax Act was concerned, the only mode of recovery was the mode prescribed in the first four sub-sections and not the mode prescribed in sub-section (5). The Income-tax Act was amended by Act No. XLVIII of 1948 and by that amendment a new sub-section was enacted to of Section 46 was deleted. Therefore, as far as
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