{"id":149103,"date":"1981-02-11T00:00:00","date_gmt":"1981-02-10T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/bhagwan-dass-jain-vs-union-of-india-on-11-february-1981"},"modified":"2017-05-01T09:20:54","modified_gmt":"2017-05-01T03:50:54","slug":"bhagwan-dass-jain-vs-union-of-india-on-11-february-1981","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/bhagwan-dass-jain-vs-union-of-india-on-11-february-1981","title":{"rendered":"Bhagwan Dass Jain vs Union Of India on 11 February, 1981"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Bhagwan Dass Jain vs Union Of India on 11 February, 1981<\/div>\n
Equivalent citations: 1981 AIR 907, \t\t 1981 SCR (2) 808<\/div>\n
Author: E Venkataramiah<\/div>\n
Bench: Venkataramiah, E.S. (J)<\/div>\n
           PETITIONER:\nBHAGWAN DASS JAIN\n\n\tVs.\n\nRESPONDENT:\nUNION OF INDIA\n\nDATE OF JUDGMENT11\/02\/1981\n\nBENCH:\nVENKATARAMIAH, E.S. (J)\nBENCH:\nVENKATARAMIAH, E.S. (J)\nSEN, A.P. (J)\n\nCITATION:\n 1981 AIR  907\t\t  1981 SCR  (2) 808\n 1981 SCC  (2) 135\t  1981 SCALE  (1)276\n CITATOR INFO :\n R\t    1989 SC1949\t (8)\n R\t    1990 SC  85\t (23)\n R\t    1990 SC1637\t (46)\n E&D\t    1990 SC1664\t (6)\n RF\t    1991 SC1676\t (31)\n\n\nACT:\n     Income-tax Act,  1961, S.\t23(2)(1) &  Constitution  of\nIndia 1950,  Seventh Schedule  List I, Entry 82 and List II,\nEntry  49-Income-Income\t from  house  property-Self-occupied\nproperty-Whether  amounts  to  income-Legislative  practice-\nInterpretation of entries in Lists.\n     Words and\tPhrases-'Income'-Meaning of-Constitution  of\nIndia, 1950, Seventh Schedule List I, Entry 82.\n\n\n\nHEADNOTE:\n     Section 22\t to 27 of the Income-tax Act, 1961 relate to\nthe levy  and  computation  of\ttax  on\t income\t from  house\nproperty. Section  23(2)(i) states  that where\tthe property\nconsists of  a house  in the occupation of the owner for the\npurposes of  his residence,  the annual\t value of such house\nshall first  be determined  in the  same manner\t as  if\t the\nproperty had  been let and further be reduced to one half of\nthe amount  so determined  or  one  thousand  eight  hundred\nrupees whichever  is less.  Where the  property consists  of\nmore than  one house  in the occupation of the owner for the\npurposes of  his own  residence. Section  23(2)(ii) provides\nthat the  provisions of\t clause\t (i)  shall  apply  only  in\nrespect of  one of such houses which the assessee may at his\noption specify in that behalf.\n     The petitioner,  an assessee  under the  Act, contended\nbefore the High Court in a petition under Article 226 of the\nConstitution, that  inclusion of  any amount  under  section\n23(2) of the Act in his income was unconstitutional as there\ncould be  no income at all in such a case accruing to him in\na true\tsense of  that term  and that the liability that was\nsought to  be imposed  under  the  Act\tin  respect  of\t his\nresidential house  was in  its pith  and substance  a tax on\nbuilding falling  under Entry  49 of  List II of the Seventh\nSchedule to  the Constitution and hence Parliament could not\nimpose the  said liability  under a  law made in exercise of\nits legislative\t power under  Entry 82\tof  List  I  of\t the\nSeventh Schedule  which authorised it only to levy 'taxes on\nincome other  than  agricultural  income'.  The\t High  Court\nrejected the plea and dismissed the Writ Petition.\n     In the  Special Leave  Petition to\t this Court  it\t was\ncontended on  behalf of\t the petitioner\t that as  he was not\nderiving any  monetary benefit by residing in his own house,\nno tax\tcould be  levied on  him, on  the ground  that he is\nderiving income\t from that house, and that the word 'income'\nonly means  realisation of  monetary benefit and that in the\nabsence of any such realisation, the inclusion of any amount\nby way\tof notional income under section 23(2) of the Act in\nthe chargeable\tincome was  impermissible as  it was outside\nthe scope  of Entry  82 of List I of the Seventh Schedule to\nthe Constitution.\n809\n^\n     HELD : 1. The tax levied under the Income-tax Act is on\nthe income (though computed in an artificial way) from house\nproperty and  not on  house property. Entry 49 of List II of\nthe Seventh  Schedule to the Constitution is not, therefore,\nattracted. The\tlevy in\t question squarely falls under Entry\n82 of  List I  of the  Seventh Schedule to the Constitution.\n[816 C-D]\n     2. The  expression 'income'  means 'a  thing that comes\nin'. Income  is also  defined as  the gain derived from land\ncapital or  labour or  any two\tor more of them. Even in its\nordinary economic sense, the expression 'income' include not\nmerely what  is received  or what comes in by exploiting the\nuse of\ta property  but also  what one\tsaves  by  using  it\noneself. That  which can  be converted\tinto income  can  be\nreasonably regarded as giving rise to income.\n\t\t\t\t\t      [812 B, 816 B]\n     3.(i) The\tGovernment of  India Act,  1935 was  enacted\nwhen the Indian Income-tax Act, 1922 was in force. Section 9\nof the\tIndian Income-tax  Act, 1922  provided for  levy  of\nincome tax on the basis of the bona fide annual value of the\nproperty even  when it was in the occupation of the assessee\nfor the\t purposes of his own residence. While enacting Entry\n54 of  List I  of the  Seventh Schedule to the Government of\nIndia Act,  1935 the British Parliament must have had in its\nview the  Indian Income-tax Act, 1922 which was probably the\nonly law  relating to  tax on  incomes in  force in  British\nIndia. Similarly  the Constituent  Assembly  while  enacting\nEntry  82   of\tList  I\t of  the  Seventh  Schedule  to\t the\nConstitution must  have understood  that the  word  'income'\nused in\t that Entry  would in  any event  include within its\nscope all  items which\tcame within the definition of income\nand were  subjected to\tcharge in the Indian Income-tax Act,\n1922 which  was in  force at  the time\tthe Constitution was\nadopted. [815 D-F]\n     (ii) The  Constitution makers had the Indian Income-tax\nAct, 1922  in their view is borne out from Article 270(1) of\nthe Constitution  which provides  for collection of taxes on\nincome by  the Government  of India and distribution thereof\nbetween the  Union and\tthe  States.  Article  366(i)  which\ndefines 'agricultural income' as defined for the purposes of\nthe enactments\trelating to  Indian Income-tax\tand  Article\n366(29) which  defines 'tax on income' as including a tax in\nthe nature  of excess  profits tax.  In the circumstances it\nwould not  be wrong  to construe the word income in Entry 82\nas  including\tall  items  which  were\t taxable  under\t the\ncontemporaneous law  relating to tax on incomes which was in\nforce at the time when the Constitution was enacted. [815 G-\n816 A]\n     4. This  Court in Navinchandra Mafatlal v. Commissioner\nof Income-tax,\tBombay City<\/a> 1955 SCR 829, held that the word\n'income' in Entry 82 is capable of a wider meaning than what\nwas given  to it  in the  Indian Income-tax Act, 1922 or the\nEnglish Act of 1918. [814 H]\n     5. In  Australia the  annual value\t of the\t tax payers'\nresidence owned\t by himself  or used  rent free is taken for\nconsideration for purposes of levy of income tax. In England\ntoo in\tthe case of a residence of the assessee, computation\nof income is on the basis of presumed income. [815 A]\n     Resch v.  The  Federal  Commissioner  of  Taxation,  66\nC.L.R. 198  at p.  224 and Governors of the Rotunda Hospital\nDublin v.  Coman (7  T.C. 517 at 586 587) Simon's Income tax\n(second Edn.) Vol. I p. 502 referred to.\n810\n     6. It  is well-settled that the entries in the Lists in\nthe Seventh  Schedule to the Constitution should not be read\nin a  narrow or\t restricted sense and each and every subject\nmentioned in  the entries should be read as including within\nits scope  all ancillary  and subsidiary  matters which\t can\nfairly and  reasonably be  comprehended in  it. Words in the\nConstitution conferring\t legislative power  should receive a\nliberal construction  and should  be  interpreted  in  their\nwidest amplitude. [811 H-812 B]\n\n\n\nJUDGMENT:\n<\/pre>\n
     CIVIL APPELLATE  JURISDICTION :  Special Leave Petition
\nNo. 8720 of 1979.\n<\/p>\n
     From the  Judgment and  Order  dated  27-10-79  of\t the
\nMadhya Pradesh High Court in M.P. No. 636\/78.\n<\/p>\n
     Shiv Dayal,  Mrs.\tBagga  and  Mr.\t S.  Bagga  for\t the
\nPetitioner.\n<\/p>\n
     The Order of the Court was delivered by
\n     VENKATARAMIAH, J.-The  short question  which arises for
\nconsideration in  this petition\t for special leave to appeal
\nfiled under Article 136 of the Constitution is whether it is
\nopen to the Income-tax Officer while computing the liability
\nof an  assessee\t to  tax  under\t the  Income-tax  Act,\t1961
\n(hereinafter referred  to as  ‘the Act’)  to include  in the
\nincome of  the assessee\t any amount calculated in accordance
\nwith section  23(2) of\tthe Act in respect of a house in the
\noccupation of  the assessee  for the  purposes\tof  his\t own
\nresidence. The\tpetitioner who\tis an assessee under the Act
\ncontended before  the High  Court of  Madhya  Pradesh  in  a
\npetition filed\tunder Article  226 of  the Constitution that
\ninclusion of  any amount  under section\t 23(2) of the Act in
\nhis income  was unconstitutional as there could be no income
\nat all\tin such\t a case accruing to him in the true sense of
\nthat term, the liability that was sought to be imposed under
\nthe Act\t in respect of his residential house was, therefore,
\nin its\tpith and  substance a  tax on building falling under
\nEntry  49  of  List  II\t of  the  Seventh  Schedule  to\t the
\nConstitution and  hence Parliament could not impose the said
\nliability under\t a law\tmade in\t exercise of its legislative
\npower under  Entry 82  of List\tI of the Seventh Schedule to
\nthe Constitution  which authorised  it only to levy taxes on
\nincome\tother  than  agricultural  income.  The\t High  Court
\nrejected the  plea of  the petitioner and dismissed the writ
\npetition. The  petitioner has  now applied to this Court for
\nspecial leave  to appeal  against the  decision of  the High
\nCourt.\n<\/p>\n
     When the  petition came  up for  hearing on February 5,
\n1981 before us, we did not find that there was any ground to
\ngrant special  leave to appeal but since the case was argued
\nwith some  persistence,\t we  decided  to  give\treasons\t for
\nrejecting the  prayer of  the petitioner which we proceed to
\ngive hereunder :\n<\/p>\n
811<\/span><\/p>\n
     Section 4\tof the\tAct lays down that where any Central
\nAct  enacts   that  income-tax\tshall  be  charged  for\t any
\nassessment year\t at any\t rate or  rates, income-tax  at that
\nrate or\t those rates  shall be\tcharged\t for  that  year  in
\naccordance with, and subject to the provisions of the Act in
\nrespect of the total income of the previous year or previous
\nyears, as  the case  may be,  of every person. Section 14 of
\nthe Act\t mentions ‘income from house property’ as one of the
\nheads of  income liable\t to charge. Sections 22 to 27 of the
\nAct relate  specifically to  the levy and computation of tax
\non income  from house property. Section 22 provides that the
\nannual value  of property  consisting of  any  buildings  or
\nlands appurtenant  thereto of  which  the  assessee  is\t the
\nowner, other  than such\t portions of such property as he may
\noccupy for  the\t purposes  of  any  business  or  profession
\ncarried on  by him  the profits\t of which  are chargeable to
\nincome-tax, shall be chargeable to income-tax under the head
\n“income from  house property”.\tSection 23(2)(i)  of the Act
\nstates that  where the\tproperty consists  of a house in the
\noccupation  of\tthe  owner  for\t the  purposes\tof  his\t own
\nresidence, the\tannual value  of such  house shall  first be
\ndetermined in  the same\t manner as  if the property had been
\nlet and\t further be  reduced by\t one-half of  the amount  so
\ndetermined  or\t one  thousand\tand  eight  hundred  rupees,
\nwhichever is  less. Section  23(2) (ii)\t of the Act provides
\nthat where  the property  consists of more than one house in
\nthe occupation\tof the\towner for  the purposes\t of his\t own
\nresidence, the\tprovisions of  clause (i)  of section  23(2)
\nshall apply only in respect of one of such houses, which the
\nassessee may,  at his  option, specify in that behalf. There
\nare some  other ancillary  and incidental  provisions in the
\nAct dealing with the computation of the annual value of such
\nproperty with  which we\t are not  concerned in\tthe  present
\npetition.\n<\/p>\n
     The argument  urged on behalf of the petitioner is that
\nas the\tpetitioner is  not deriving  any monetary benefit by
\nresiding in  his own  house, no\t tax can be levied on him on
\nthe ground that he is deriving income from that house. It is
\ncontended that\tthe word  ‘income’ only means realisation of
\nmonetary benefit  and  that  in\t the  absence  of  any\tsuch
\nrealisation by\tthe assessee, the inclusion of any amount by
\nway of notional income under section 23(2) of the Act in the
\nchargeable income  was impermissible,  as it was outside the
\nscope of  Entry 82  of List I of the Seventh Schedule to the
\nConstitution.\n<\/p>\n
     Entry 82  of List\tI of  the Seventh  Schedule  to\t the
\nConstitution empowers  Parliament to  levy ‘taxes  on income
\nother than agricultural income’. Now it is well-settled that
\nthe entries in the list in the
\n812<\/span>
\nSeventh Schedule to the Constitution should not be read in a
\nnarrow or  restricted  sense  and  each\t and  every  subject
\nmentioned in  the entries should be read as including within
\nits scope  all ancillary  and subsidiary  matters which\t can
\nfairly and  reasonably be  comprehended in  it. Words in the
\nConstitution conferring\t legislative power  should receive a
\nliberal construction  and should  be  interpreted  in  their
\nwidest amplitude.\n<\/p>\n
     The expression  ‘income’ according to Oxford Dictionary
\nmeans ‘a thing that comes in’. Income may also be defined as
\nthe gain  derived from land, capital or labour or any two or
\nmore of them.\n<\/p>\n
     In Resch v. The Federal Commissioner of Taxation Dixon,
\nJ. of the High Court of Australia observed :\n<\/p>\n
\t  “The subject\tof  the\t income\t tax  has  not\tbeen
\n     regarded  as  income  in  the  restricted\tsense  which
\n     contrasts gains  of the  nature of\t income with capital
\n     gains, or\tactual receipts\t with increases of assets or
\n     wealth. The  subject has  rather been  regarded as\t the
\n     substantial gains\tof persons or enterprises considered
\n     over intervals  of time and ascertained or estimated by
\n     standards appearing sufficiently just, but nevertheless
\n     practical and  sometimes concerned\t with  avoidance  or
\n     evasion  more   than  with\t accuracy  or  precision  of
\n     estimation.  To   include\tthe   annual  value  of\t the
\n     taxpayer’s residence owned by himself or used rent free
\n     and to fix it at five. percent of the capital value has
\n     not  been\t considered  to\t  introduce  a\tnew  subject
\n     [Hardinge’s Case  (1917) 23  C.L.R. 119]. To treat part
\n     of the  undistributed profits earned during the current
\n     year  as\tpart  of   the\tassessable   income  of\t the
\n     shareholder imports  no  new  subject  [Cornell’s\tcase
\n     (1920) 29\tC.L.R. 39  cf. Kellow-Falkiner\tPty. Ltd. v.
\n     Federal Commissioner of Taxation (1928) 34 A.L.R. 276],
\n     nor does  it to  substitute, in  the case of a foreign-<\/p><\/blockquote>\n
     controlled\t business,  for\t taxable  income  ordinarily
\n     calculated a  percentage of gross receipts fixed by the
\n     discretionary judgment  of\t the  Commissioner  [British
\n     Imperial Oil  Cases (1925)\t 35 C.L.R.  422;  (1926)  38
\n     C.L.R. 153]. (emphasis supplied)
\n     In Simon’s\t Income Tax  (Second Edition) Volume I, page
\n502 dealing with the question of computation of income under
\nSchedule ‘A’ to the English Income-tax Act, which related to
\ntax on\tthe income attributable to property, it is stated as
\nfollows:-\n<\/p>\n
813<\/span><\/p>\n
\t  “It is now clear however, that
\n\t  (1)  income tax  is but  one tax  imposed  by\t the
\n\t       Income Tax Acts;\n<\/p><\/blockquote>\n
\t  (2)  income tax is a tax upon income; and
\n\t  (3)  Sched. A\t is but\t one of five Schedules which
\n\t       provide varying\tmethods\t of  estimating\t the
\n\t       measure of that income from different sources
\n\t       for the purposes of charge to tax.\n<\/p><\/blockquote>\n
\t  The theory  behind Sched. A is that the possession
\n     of an  interest in\t property gives\t rise to  income,  a
\n     theory which  is not  always borne\t out in\t fact.\tThat
\n     there may\tbe no income in fact is disregarded when the
\n     assessment is  made. The  actual or hypothetical income
\n     has to be measured by some standard for the purposes of
\n     taxation and  the standard\t prescribed  is\t the  annual
\n     value. This  principle  has  been\tsubject\t to  adverse
\n     comment, but once the theory is appreciated, the method
\n     may be understood and any confusion of thought, created
\n     by the  words of  the charging  section, dispelled. The
\n     use to  which land\t is put\t does not  (apart  from\t the
\n     excepted concerns\tmentioned in  the proviso to para. 1
\n     of Sched. A above) prevent it from being assessed under
\n     Sched. A;\tbut if\ta trade\t which is  not one  of those
\n     excepted concerns is carried on property which is owned
\n     by the  trader and\t is  assessed  under  Sched.  A,  an
\n     allowance for the annual value is made in computing the
\n     profits of the trade”. (emphasis supplied)
\n     In the  Governors of  the Rotunda\tHospital, Dublin  v.\n<\/p><\/blockquote>\n
Coman which  was a  case arising from Ireland, Lord Atkinson
\nobserved thus :\n<\/p>\n
\t  “It would,  I think, be well to bear in mind that,
\n     to\t use  Lord  Macnaghten’s  words\t in  his  celebrated
\n     judgment in  the London  County Council v. The Attorney
\n     General (4\t T.C. 265)  (1901 A.C.\t35), “Income Tax….
\n     “is a  tax on income”. When the amount of the income to
\n     be taxed under the Act of 1842 and the Acts amending it
\n     comes to be measured, different standards are selected,
\n     and the  words “profits or gains” are used in reference
\n     to all the Schedules in the Act of 1842 to describe the
\n     income, the subject of charge. The standard selected as
\n     a measure of the amount of the income to be taxed under
\n     Schedule\tA    in\t  respect   of\t lands,\t  tenements,
\n     hereditaments and\theritages capable  of occupation  is
\n     the annual value. If the owner of such pro-\n<\/p><\/blockquote>\n
814<\/span><\/p>\n
     perties as\t these should  be himself  in occupation  of
\n     them, it  by no  means follows  that he  will, in fact,
\n     derive from  them an income equal to this annual value;
\n     but, as he has the use and enjoyment of the properties,
\n     it is,  for the  purposes of the Statute, presumed that
\n     he does  derive from  them an income equal in amount to
\n     this annual  value, and  the tax  is accordingly, under
\n     Schedule  A,   assessed  upon  this  presumed  income”.
\n     (emphasis supplied).\n<\/p><\/blockquote>\n
     In Navinchandra Mafatlal v. The Commissioner of Income-<\/a>\n<\/p><\/blockquote>\n
tax, Bombay  City(1) while justifying the levy of income tax
\non capital gains under section 12-B of the Indian Income-tax
\nAct, 1922  enacted by the Central Legislature in exercise of
\nthe power  conferred under  Entry No.  54 of  List I  of the
\nSeventh Schedule  to  the  Government  of  India  Act,\t1935
\ncorresponding to  Entry 82 of List I of the Seventh Schedule
\nto the\tConstitution,  Das,  J.\t (as  he  then\twas)  having
\nobserved at page 837 thus :\n<\/p>\n
\t  “What,  then,\t  is  the   ordinary,  natural\t and
\n     grammatical meaning  of the word “income”? According to
\n     the dictionary  it means  “a thing that comes in”. (See
\n     Oxford Dictionary,\t Vol. V,  page 162; Stroud, Vol. II,
\n     pages 14-16).  In the  United States  of America and in
\n     Australia both  of\t which\talso  are  English  speaking
\n     countries the  word “income”  is understood  in a\twide
\n     sense so as to include a capital gain. Reference may be
\n     made to  Eisner v.\t Macomber (1920)  252 U.S.  189;  64
\n     L.Ed. 521,\t Merchants’ Loan  & Trust  Co. v.  Smietanka
\n     (1925) 255 U.S. 509; 65 L.Ed. 751, and United States v.
\n     Stewart (1940) 311 U.S. 60; 85 L. Ed. 40, and Resch. v.
\n     Federal Commissioner  of Taxation (1942) 66 C.L.R. 198.
\n     In each  of these\tcases very wide meaning was ascribed
\n     to the word “income” as its natural meaning”
\n     proceeded to hold at page 838 :\n<\/p><\/blockquote>\n
\t  “As already observed, the word should be given its
\n     widest connotation\t in view  of the fact that it occurs
\n     in a legislative head conferring legislative power”.<\/p><\/blockquote>\n
     In the  above  case  this\tCourt  held  that  the\tword
\n“income” in  Entry No.\t54 of List I of the Seventh Schedule
\nto the\tGovernment of  India Act,  1935 should\tbe  given  a
\nmeaning wider  than the\t connotation  given  to\t it  in\t the
\nEnglish Income-tax Act, 1918 under which income attributable
\nto property was chargeable under Schedule ‘A’ thereof.\n<\/p>\n
815<\/span><\/p>\n
     Now coming\t to the\t specific  question  of\t the  charge
\narising under  section 23(2)  of the  Act it is already seen
\nthat in\t Australia the\tannual\tvalue  of  the\ttax  payer’s
\nresidence owned\t by himself  or used  rent free is taken for
\nconsideration for purposes of levy of income tax. In England
\ntoo in\tthe case of a residence of the assessee, computation
\nof income  is made on the basis of presumed income. In D. M.
\nVakil v. Commissioner of Income-tax which was a case arising
\nunder the  Indian Income-tax  Act, 1922,  the High  Court of
\nBombay held  that under\t section 9  of that  Act the tax was
\npayable by  an assessee\t in respect  of the bona fide annual
\nvalue of  the property\tirrespective of the question whether
\nhe received that value or not. The High Court of Gujarat has
\nalso taken  the same view in Sakarlal Balabhai v. Income Tax
\nOfficer, Special Investigation Circle IV, Ahmedabad & Anr.\n<\/p>\n
     There is  one other  circumstance which persuades us to
\ntake the  view that  computation of  income for\t purposes of
\nlevy of\t income tax  in accordance with section 23(2) of the
\nAct is\tjustifiable under  Entry 82 of List I of the Seventh
\nSchedule to the Constitution. It is to be borne in mind that
\nthe Government\tof India  Act, 1935  was  enacted  when\t the
\nIndian Income-tax  Act, 1922  was in force. Section 9 of the
\nIndian Income-tax  Act, 1922 provided for levy of income tax
\non the\tbasis of  the bona fide annual value of the property
\neven when  it was  in the occupation of the assessee for the
\npurposes of  his own  residence. While\tenacting entry 54 of
\nlist I\tof the\tSeventh Schedule  to the Government of India
\nAct, 1935,  the British Parliament must have had in its view
\nthe Indian  Income-tax Act, 1922 which was probably the only
\nlaw relating  to tax  on incomes  in force  in British India
\nthen. Similarly\t the  Constituent  Assembly  while  enacting
\nEntry  82   of\tList  I\t of  the  Seventh  Schedule  to\t the
\nConstitution must  have understood  that the  word  ‘income’
\nused in\t that Entry  would in  any event  include within its
\nscope all  items which\tcame within the definition of income
\nand were  subjected to\tcharge in the Indian Income-tax Act,
\n1922 which  was in  force at  the time\tthe Constitution was
\nadopted. That the Constitution makers had the Indian Income-
\ntax Act, 1922 in their view is borne out from Article 270(1)
\nof the\tConstitution which  provides for collection of taxes
\non income  by  the  Government\tof  India  and\tdistribution
\nthereof between\t the Union  and the  States, Article  366(1)
\nwhich defines  ‘agricultural income’  as agricultural income
\nas defined  for the  purposes of  the enactments relating to
\nIndian Income-tax  and Article 366(29) which defines ‘tax on
\nincome’ as  including a\t tax in\t the  nature  of  an  excess
\nprofits tax. In the circumstances it
\n816<\/span>
\nwould not be wrong to construe the word ‘income’ in Entry 82
\nas  including\tall  items  which  were\t taxable  under\t the
\ncontemporaneous law  relating to tax on incomes which was in
\nforce at  the time when the Constitution was enacted when as
\nobserved by  this Court in the case of Navinchandra Mafatlal
\n(supra) the  word ‘income’ in Entry 82 is capable of a wider
\nmeaning than  what was\tgiven to it in the Indian Income-tax
\nAct, 1922 or the English Act of 1918.\n<\/p>\n
     Even in  its ordinary  economic sense,  the  expression
\n‘income’ includes  not merely what is received or what comes
\nin by  exploiting the  use of  a property  but also what one
\nsaves by  using it oneself. That which can be converted into
\nincome can  be reasonably regarded as giving rise to income.
\nThe tax\t levied under  the Act\tis  on\tthe  income  (though
\ncomputed in  an artificial  way) from  house property in the
\nabove sense  and not  on house property. Entry 49 of List II
\nof  the\t  Seventh  Schedule  to\t the  Constitution  is\tnot,
\ntherefore, attracted.  The levy\t in question  squarely falls
\nunder Entry  82 of  List I  of the  Seventh Schedule  to the
\nConstitution.\n<\/p>\n
     Hence we do not find any merit in the contentions urged
\non behalf of the petitioner.\n<\/p>\n
     For the  foregoing reasons,  the leave  prayed  for  is
\nrefused and the petition is dismissed.\n<\/p>\n
N.V.K.\t\t\t\t\t Petition dismissed.\n817<\/span>\n\n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Bhagwan Dass Jain vs Union Of India on 11 February, 1981 Equivalent citations: 1981 AIR 907, 1981 SCR (2) 808 Author: E Venkataramiah Bench: Venkataramiah, E.S. (J) PETITIONER: BHAGWAN DASS JAIN Vs. RESPONDENT: UNION OF INDIA DATE OF JUDGMENT11\/02\/1981 BENCH: VENKATARAMIAH, E.S. (J) BENCH: VENKATARAMIAH, E.S. (J) SEN, A.P. (J) CITATION: […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-149103","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nBhagwan Dass Jain vs Union Of India on 11 February, 1981 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/bhagwan-dass-jain-vs-union-of-india-on-11-february-1981\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bhagwan Dass Jain vs Union Of India on 11 February, 1981 - 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