HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Gursahai Saigal v. Commissioner of Income-tax, Punjab
Civil Appeals Nos. 10 to 12 of 1962
[1963] 3 SCR 893 ·
Indian Income-tax Act, 1922: section 18A(3), (6), (8), (9)
Holding and result. Section 18A(8) imposed interest despite complete non-payment; the machinery in section 18A(6) was read from the January when tax ought to have been paid, with the shortfall equal to the full eighty per cent, and the three assessee appeals were dismissed.
Sources & disclosures includedDownload original judgment / order
Three-judge bench; judgment delivered by A. K. Sarkar, J. · J. L. Kapur, J. · A. K. Sarkar, J. · M. Hidayatullah, J.
01 · Facts of the case
A previously unassessed taxpayer was required by section 18A(3) to estimate income and pay advance tax, but did neither. Interest was charged in three assessment orders under section 18A(8). The taxpayer argued that section 18A(6) mentioned the year in which tax “was paid” and therefore supplied no workable start date or shortfall where nothing had been paid.
02 · Discussion by the Hon’ble Court
The Court distinguished the strict construction of a charging provision from ordinary construction of machinery that makes an admitted charge effective. Section 18A(8) plainly created liability for interest and incorporated section 18A(6) only as computation machinery. To make it workable, the start date was the first January in the financial year when tax ought to have been paid; with no payment, the shortfall was the entire eighty per cent.
Source: Primary judgment: reasoning
03 · Judicial decision
Interest under section 18A(8) was chargeable for failure to estimate and pay under section 18A(3). The separate penalty under section 18A(9) was additional and did not displace the interest liability.
Source: Primary judgment: holdings
04 · Outcome / in whose favour
All three appeals dismissed; the Punjab High Court’s answer against the assessee was upheld, with costs to the Commissioner.
05 · AKHB REVIEW POINT
AKHB analysis: do not use a drafting feature in computational machinery to defeat an independently clear charge. First establish that the charge applies; then construe incorporated machinery to make it operational without expanding the charge itself.
Source & verification
Download original judgment / order · Open cited source rendition
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Statutory scope
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Later treatment
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General legal and tax research only; not legal or tax advice. Verify the complete judgment, governing statutory version and subsequent judicial treatment before reliance. The AKHB REVIEW POINT is editorial analysis, not the Court's holding, and no current-law clearance is claimed.