CANARA INDUSTRIAL AND BANKING SYNDICATE LTD Vs. SARVOTHAMA KAMATH
HIGH COURT OF KERALA
CANARA INDUSTRIAL AND BANKING SYNDICATE LTD.
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(1.)In a suit filed after the commencement of Act XXXI of 1958 a decree was passed under S.10(2) thereof for payment of the decree debt in 17 instalments applying the other provisions of the Act regarding interest, etc. Thereafter, amending Act II of 1961 effected some changes to some of the provisions of the parent Act. The amending Act also provided that the amendments should be deemed to have come into force on 14th July 1958, i. e., the date of commencement of the parent Act. Subsequently the decree holder, who is a banking company, filed an application under S.7 of the Act for amending the decree in accordance with the provisions of the amending ;Act, The lower court dismissed that application and hence the Civil Revision Petition by the banking company.
(2.)Mr. Rama Shenoi, the learned advocate of the petitioner, draws my attention to the decision of the Supreme Court in M. K. Venkatachalam v. Bombay Dyeing and Mfg. Co. Ltd. ( AIR 1958 SC 875 ). In that case the Income Tax Officer made an order of assessment for the year 1952-53 on 9th October 1952. Thereafter, S.18A(5) of the Income Tax Act was amended and by the amending Act the amendment was to be deemed to have been included in the parent Act as from 1st April 1952. After the said amendment the Income Tax Officer started proceedings under S.35 of the Act purporting to rectify the mistake apparent from the record. The matter was taken up before the High Court of Bombay and the High Court held that the mistake mentioned by S.35 had to be apparent on the face of the order and it could only be judged in the light of the law as it stood on the date when the order was passed. On appeal the Supreme Court held, following the observation of Lord Asquith in East End Dwellings Co. Ltd. v. Finsbury Borough Council [ 1952 AC 109 at p. 132], that the effect of the retrospective operation of the amending Act was that the proviso inserted by the amending Act would, for all legal purposes, have to be deemed to have been included in the parent Act as from 1st April 1952. It was argued before the Supreme Court that in applying an amendment retrospectively, the finality of the order passed by the Income Tax Officer should not be impaired. On this contention their Lordships held that the order of assessment passed by the Income Tax Officer was not final and it remained always to be modified under S.35 of the Act. Their Lordships also observed that the action taken by the Income Tax Officer under S.35 was not in revision of his own order in the light of the retrospective amendment. In that view, their Lordships held that that principle could not be applied to the case.
(3.)It is apparent from this judgment that their Lordships of the Supreme Court approved of the principle that the finality of an order could not be impaired by the retrospective application of an amendment. Their Lordships referred to two decisions of the Privy Council, namely: The Colonial Sugar Refining Company v. Irving ( 1905 AC 369 ) and Delhi Cloth & General Mitts Co. Ltd. v. Income Tax Commissioner [ AIR 1927 PC 242 ]. In the earlier case the Privy Council held that while provisions of a statute dealing merely with matters of procedure might properly have retrospective effect attributed to them, provisions which touched a right in existence at the passing of the statute would not be applied retrospectively in the absence of express enactment or necessary intendment. In the next case the Privy Council again held that provisions which, if applied retrospectively, would deprive of the existing finality of orders, which, when that statute came into force, were final, were provisions which touched existing rights. The effect of these Privy Council decisions, which were approved by the Supreme Court, is that the existing finality of orders will not be affected by the retrospective application of an amendment in the absence of express enactment or necessary intendment.
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