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Income Tax Officer, Central Circle, Jodhpur v/s Jaipur Udyog Limited

    Civil Appeals Nos. 1818-19 (NT) of 1977
    Decided On, 28 March 1995
    At, Supreme Court of India
    By, HON'BLE JUSTICE B. L. HANSARIA
    By, HON'BLE JUSTICE S. P. BHARUCHA AND HON'BLE JUSTICE S. C. SEN
   


Judgment Text
1. Under the provisions of Section 18(3-F) of the Indian Income Tax Act, 1922, the respondent-Company applied to the Income Tax Officer to determine the appropriate proportion of the dividend on which income tax or super tax was not payable by the recipients. The Income Tax Officer made such determination, as the High Court found. It was, however, the case of the successor Income Tax Officer that the determination was faulty and, a accordingly, he invoked the power under Section 18(7) and declared the respondent-Company in default in respect of the tax which, according to him, ought to have been deducted. The respondent-Company approached the High Court of Rajasthan by way of a writ petition and the order under Section 18(7) was quashed, particularly on the ground that once the determination had been made by the Income Tax Officer under Section 18(3-F) and the respondent-Company had acted in accordance with it, the respondent-Company could not be said to be in default under the provisions of Section 18(7). Having heard the learned counsel for the Revenue and perused the impugned judgment, we are of the view that the High Court was jus

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tified in the view that it took 2. Accordingly, the appeals are dismissed. There shall be no order as to costs.
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