1962 INSC 0009
                                        Southern Roadways (Private) Ltd

                                                           Vs

                                            Union of India and Another

            (CJI B. P. Sinha, J. L. Kapur, M. Hidayatullah, J. C. Shah, J. R. Mudholkar JJ)

                                                      16.01.1962

                                                     JUDGMENT

KAPUR J. ­

This is a petition by the assessee under article 32 of the Constitution challenging the consitutionality
of the second proviso to section 10 (2) (vi-b), Income-tax Act, introduced by the Taxation Laws
(Amendment) Act (28 of 1960). The relevant section with the proviso is as follows :

                  "10. (1) The tax shall be payable by an assessee under the head 'profits and gains of
                  business, profession or vocation' in respect of the profits or gains of any business,
                  profession or vocation carried on by him.

                  (2) such profits or gains shall be computed after making the following allowances,
                  namely :....

(vib) in respect of machinery or plant being new, which has been installed after the 31st of March,
1954, and which is wholly used for the purposes of the business carried on by the assessee, a sum by
way of development rebate in respect of the year of installation equivalent to twenty-five per cent.
of the actual cost of such machinery or plant to the assessee.

Provided that no allowance under this clause shall be made unless the particulars prescribed for the
purpose of clause (vi) have been furnished by the assessee in respect of such machinery or plant :

Provided further that no allowance under this clause shall be made in respect of any machinery or
plant which consist of office appliances or road transport vehicles."

The petitioner is a limited company with its registered office at Madurai in the State of Madras
which owns a fleet of buses and lorries and carries on the business of transport. In respect of
assessment year 1960-61 it claimed a development rebate on all its plants and machinery including
business. The Income-tax Officer disallowed the claim of rebate on transport vehicles under the
proviso above quoted and computed the tax payable without such rebate. It was contended on behalf
of the petitioner that the provision offends article 14 in that it discriminates between machinery
which is office appliance or road transport vehicles and other kind of machinery. It is difficult to
accept such a contention because there is nothing in the Constitution which prevents the Legislature
from choosing the object of taxation from amongst various classes of machinery for the purpose of
giving development rebate. The Constitution does not prohibit any such classification which has
been made in the present case.

The petition is wholly without merit and is therefore dismissed and the rule is discharged. The
petitioner will pay the costs of the respondents.
Petition dismissed.
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