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Riverside (Bhatpara) Electric Supply Co. Ltd. v. Commissioner Of Income-Tax, West Bengal-I.
Summary of the Court's Opinion (Sabyasachi Mukharji, J.)
Factual and Procedural Background
The assessee is a company engaged in distribution of electricity. It installed service lines, a portion of whose cost was borne by consumers by way of contributions. Under the Indian Income-tax Act, 1922, the issue arose whether such contributions received from consumers should reduce the "actual cost" of service-line assets for purposes of depreciation.
The Patna High Court decision in Commissioner of Income-tax v. Ranchi Electric Supply Co. Ltd. held that “actual cost” meant the actual cost incurred irrespective of contributions received from consumers. Assessments of the assessee up to assessment year 1962–63 were made on that basis.
The Income-tax Act, 1961 introduced definitions for "actual cost" (section 43(1)) and "written down value" (section 43(6)) which, unlike the 1922 Act, required deduction of contributions made "by any other person" (including consumers) when computing actual cost. For assessment year 1962–63 the Income-tax Officer adjusted depreciation claimed by the assessee to reflect contributions (Rs. 59,207) received from Government and local authorities.
The Appellate Assistant Commissioner directed recomputation of depreciation treating gross cost less contributions received from consumers and Government/local authorities; the Tribunal confirmed that the 1961 Act's definitions (sections 43(1) and 43(6)) should be applied with reference to the assessment year 1962–63 and to all assets in use that year. Under section 256(1) of the Income-tax Act, 1961, this question was referred to the court:
“Whether, on the facts and in the circumstances of the case, depreciation could be computed on the basis of the definition of ‘actual cost’ and ‘written-down value’ in sections 43(1) and 43(6) respectively of the Income-tax Act, 1961, even with reference to the assets in use in the previous year for the assessment year 1962–63 but which were acquired prior thereto?”
Legal Issues Presented
- Whether depreciation for assessment year 1962–63 could be computed using the definitions of "actual cost" and "written down value" contained in sections 43(1) and 43(6) of the Income-tax Act, 1961, even in respect of assets that were acquired prior to the previous year (i.e., assets acquired before the timeframe to which the assessment year relates).
Arguments of the Parties
Assessee's Arguments
- The 1961 Act was not intended to operate retrospectively; the concept of "actual cost" is tied to the time of acquisition and must be determined according to the tax law prevailing at acquisition.
- Contributions made by consumers prior to the 1961 Act should not be used to recompute the actual cost for later assessments; to do so would amount to impermissible retrospection and would interfere with rights established under prior assessments.
- Applying the 1961 definition retrospectively would create anomalies and absurdities: it could produce negative written down values (on which depreciation cannot be calculated) and produce absurd results under Explanation 2 (gift/inheritance) and conflict with provisions such as section 34(2) and section 32(3).
- Cited authorities on statutory interpretation: where an absurd result would follow, courts should avoid absurd constructions or supply omitted words to give effect to legislative intent.
Revenue's Arguments
- The intent and purpose of the 1961 legislation was to apply the new definitions from the relevant year (i.e., from the coming into operation of the 1961 Act) and therefore the 1961 Act should govern computations for assessment years falling after its commencement.
- Depreciation for the assessment year in question should be computed in terms of section 43(1) and section 43(6) of the 1961 Act for all assets in use in that year, regardless of the year of acquisition.
Tribunal / Appellate Assistant Commissioner's Position
- The Appellate Assistant Commissioner directed recalculation of depreciation treating actual cost at gross less contributions from consumers and Government/local authorities; the Tribunal confirmed that sections 43(1) and 43(6) of the 1961 Act applied to all assets in use in assessment year 1962–63.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Commissioner of Income-tax v. Ranchi Electric Supply Co. Ltd., [1954] 26 ITR 89 (Pat) | The Patna High Court held that “actual cost” meant the actual cost incurred in installing connections irrespective of contributions received from consumers. | Used as historical background: assessments up to 1962–63 were made on this basis; the court contrasted this earlier position with the 1961 Act's broader definition. |
| Maharana Mills (Pvt.) Ltd. v. Income-tax Officer, [1959] 36 ITR 350 (SC) | Reiterated that there is no estoppel or res judicata from a previous year's assessment to a subsequent year's assessment; addressed power to rectify prior mistakes. | Relied on to support the proposition that each year's assessment is self-contained and prior determinations do not bind later assessments; court invoked this to reject the assessee's estoppel/res judicata argument. |
| Karnani Industrial Bank Ltd. v. Commissioner of Income-tax, [1954] 25 ITR 558 (Cal) | Reiterated the principle that one year's tax determination does not estop subsequent assessments. | Referred to as consistent authority supporting the court's view that prior-year determinations do not prevent redetermination under changed law. |
| Colquhoun (Surveyor of Taxes) v. Brooks, [1889] 2 TC 490 (HL) | Authority on statutory interpretation: courts should avoid constructions that lead to absurd results and may, where appropriate, supply omitted words to give effect to legislative intent. | Cited among interpretative authorities; court acknowledged the principle but found no absurdity in giving plain meaning to “actual cost” and “written down value” under the 1961 Act. |
| Perry (EM. Inspector of Taxes) v. Astor, [1935] 19 TC 255 (HL) | Authority on avoiding absurd constructions in statutory interpretation. | Cited as part of the body of interpretative authorities; court agreed with the principle but held it did not compel departing from the 1961 Act's plain words in this case. |
| R.B. Jodha Mal Kuthiala v. Commissioner of Income-tax, [1971] 82 ITR 570 (SC) | Interpretative authority referenced regarding avoiding absurd results and supplying omitted words where necessary. | Placed among authorities on interpretation; court observed these principles but concluded no absurdity or defeat of legislative intent would arise from applying section 43 as written. |
| Maharajah of Pithapuram v. Commissioner of Income-tax, [1945] 13 ITR 221 (PC) | Principles relevant to interpretation and tax law (as cited in the opinion). | Cited as consonant with the court's view; the court stated its conclusion aligned with principles enunciated in this decision. |
| Reliance Jute Mills Co. Ltd. v. Commissioner of Income-tax, [1972] 86 ITR 570 (Cal) | Decision of this Court relevant to the present line of reasoning (as cited in the opinion). | Referenced as being in consonance with the view adopted by the court in the present matter. |
Court's Reasoning and Analysis
The court's analysis proceeded from statutory text and the structure of the 1922 and 1961 Acts. It identified the crucial statutory difference: under the 1922 Act only contributions by Government or public/local authorities were required to be excluded in computing "actual cost", whereas the 1961 Act (section 43(1)) required deduction of contributions made by "any other person" (including consumers).
The court examined section 43(6) (written down value). Clause (a) clearly applies the 1961 definition of "actual cost" to assets acquired in the previous year. Clause (b) applies to assets acquired before the previous year and defines written down value as the actual cost to the assessee less all depreciation actually allowed under the 1961 Act or the 1922 Act (or under executive orders when the 1886 Act was in force). The court interpreted the specific reference to "depreciation actually allowed" under the 1922 Act as intended to safeguard prior depreciation actually granted, not to freeze the definition of "actual cost" as determined under the 1922 Act.
Addressing the assessee's contention that applying the 1961 definition to assets acquired earlier would be retrospective and would impinge on vested rights, the court rejected that contention. It reasoned that each year's assessment is self-contained, and prior determinations do not give rise to estoppel or res judicata in subsequent years; the court relied on Maharana Mills and Karnani Industrial Bank to support this position.
The court considered the argument that applying section 43 would produce absurd results (for example, negative written down values or absurd consequences under Explanation 2 for gifts/inheritances and other provisions). It rejected that argument for two primary reasons stated in the opinion:
- Negative written down values do not, in practice, translate into a basis for computing depreciation — if an asset becomes valueless for the purpose of depreciation, a negative numeric figure is not an operative basis for awarding depreciation; hence the supposed absurdity is not a valid reason to avoid the 1961 Act's plain meaning.
- Explanation 2 (gift/inheritance) and other cited provisions must be applied in the context and meaning provided by the 1961 Act when computing actual cost for assessments that come into operation after the 1961 Act; the court held that using the 1961 definitions does not necessarily produce the alleged absurdities.
The court acknowledged authorities on statutory interpretation (Halsbury, Craies, Maxwell, and several cases) that courts should avoid absurd constructions and, where necessary, supply omitted words to effect legislative intent. However, after considering those authorities, the court concluded that the plain meaning of "actual cost" and "written down value" in the 1961 Act could and should be given effect to in assessments coming into operation after the Act, including for assets acquired in earlier years.
Holding and Implications
Holding: The court answered the referred question in the affirmative and in favour of the revenue. In other words:
HOLDING: Depreciation for the assessment year 1962–63 must be computed on the basis of the definitions of "actual cost" and "written down value" contained in sections 43(1) and 43(6) of the Income-tax Act, 1961, even in respect of assets acquired prior to the previous year.
Implications:
- Direct effect on the parties: The assessee's depreciation for the assessment year 1962–63 must be recomputed in accordance with the 1961 Act's definitions; the Tribunal's and Appellate Assistant Commissioner's approach (applying section 43(1) and 43(6) to all assets in use in the relevant year) is confirmed.
- The court rejected the contention that giving effect to section 43(1) and section 43(6) would amount to impermissible retrospection or infringe vested rights. It held that each year's assessment is a self-contained computation under the law in force for that assessment year.
- No broader implications or novel interpretive exception beyond the decision's effect on computation for the assessment year and assets in use in that year are discussed in the opinion; the court did not state that it was establishing any new general principle beyond applying the clear language of the 1961 Act to the facts presented.
Costs: Each party was ordered to pay and bear its own costs.
Pyne, J. agreed with the opinion.
Sabyasachi Mukharji, J.:— The assessee is a company carrying on business of the distribution of electricity. It has service lines through which electricity is transmitted for distribution. In the case of such service lines a portion of the cost thereof is borne by the consumer concerned. Prior to the coming into force of the Income-tax Act, 1961, the Indian Income-tax Act, 1922, then in force, provided for depreciation allowance on such service lines. At that time question arose as to whether the contribution received from the consumers of electricity in respect of the service lines would go to reduce the actual cost of the said assets for the purpose of calculation of depreciation. In the case of Commissioner of Income-tax v. Ranchi Electric Supply Co. Ltd., [1954] 26 ITR 89 (Pat), it was held by the Patna High Court that the “actual cost” was the actual cost incurred in installing the connections irrespective of any contribution received from any consumer. Consequently, the amount paid by the consumers of such service lines could not be taken into account in calculating the actual cost. The assessments of the assessee-company up to the assessment year 1962–63 were made on that basis. Section 10(2)(vii) of the Indian Income-tax Act, 1922, provided that “depreciation would be allowed on the assets at such percentage of written down value thereof as may in any case or class of cases be prescribed”. “Written down value” was defined in section 10(5) of the Indian Income-tax Act, 1922, after the amendment in 1953, as under:
“(5) …… ‘written down value’ means—
(a) in the case of assets acquired in the previous year, the actual cost to the assessee:…….
(Provisos to this clause are omitted as they have no relevance)
(b) in the case of assets acquired before the previous year the actual cost to the assessee less all depreciation actually allowed to him under this Act, or any Act repealed thereby, or under executive orders issued when the Indian Income-tax Act, 1886 (II of 1886) was in force:……”
(Provisos to this clause also are omitted as being of no relevance).
2. The Explanation to the said section defined “actual cost” as follows:
“For the purposes of this sub-section, the expression ‘actual cost’ means the actual cost of the assets to the assessee reduced by that portion” of the cost thereof, if any, as has been met directly or indirectly, by Government or by any public or local authority and any allowance in res pect of any depreciation carried forward under clause (b) of the proviso to clause (vi) of sub-section (2) shall be deemed to be depreciation ‘actually allowed’.”
3. In short, therefore, depreciation under the old Act had to be allowed on the written down value of the assets as defined in clause (a) and clause (b) of section 10(5) of the Indian Income-tax Act, 1922, on the basis of “actual cost” as defined to mean the cost of the assets as reduced by the portion thereof as might have been made directly or indirectly by Government or by any public or local authority. When the Income-tax Act, 1961, came into effect definitions of “actual cost” and “written down value” were provided by section 43(1) and section 43(6) respectively of the Act. It may be relevant to refer to section 43 which is as follows:
“43. Definitions of certain terms relevant to income from profits and gains of business or profession.— In sections 28 to 41 and in this section, unless the context otherwise requires—
(1) ‘actual cost’ means the actual cost of the assets to the assessee, reduced by that portion of the cost thereof, if any, as has been met directly or indirectly by any other person or authority:……
Explanation 2.— Where an asset is acquired by the assessee by way of gift or inheritance the actual cost of the asset to the assessee shall be the written down value thereof as in the case of the previous owner for the previous year in which the asset is so acquired or the market value thereof on the date of such acquisition, whichever is the less……”
“Written down value” has been defined under section 43(6) as follows:
“43.(6) ‘Written down value’ means—
(a) in the case of assets acquired in the previous year, the actual cost to the assessee;
(b) in the case of assets acquired before the previous year, the actual cost to the assessee less all depreciation actually allowed to him under this Act or under the Indian Income-tax Act, 1922 (11 of 1922), or any Act repealed by that Act, or under any executive orders issued when the Indian Income-tax Act, 1886 (2 of 1886), was in force ………..(once again the proviso and the Explanation to the said section are omitted as being of no relevance).”
4. The difference between section 10(5Xa) of the Indian Income-tax Act, 1922, and section 43(1) of the Income-tax Act, 1961, is that under the Act of 1922 in assessing the actual cost only the contribution by Government or any other public or local authority had to be excluded while under the Act of 1961 the contribution received from any person had to be excluded. When the assessment for the year 1962–63 of the assessee came to be made by the Income-tax Officer, he found that the claim for depreciation made by the assessee included depreciation on the written down value of the service lines put into use in the assessment year 1961–62 as part of its record. The assessee had received Rs. 59,207 as and by way of contribution from the Government and local authorities. In the assessment of 1961–62 there was disallowance of proportionate depreciation on the sum of Rs. 59,207, as to that extent claim of the assessee had exceeded. In making the assessment for 1962–63 he similarly reduced the figure of depreciation claimed by the assessee taking into account the contribution received from the local authorities and the Government mentioned above. The assessee appealed to the Appellate Assistant Commissioner. According to the Appellate Assistant Commissioner's view, the actual cost for the assessment year under reference, viz., 1962–63, in respect of the assets had to be taken at gross cost subject to the deduction of the contributions received from the consumers and also the depreciation actually allowed. He directed, accordingly, recomputation of the depreciation on the above basis and if the result turned out to be a negative figure, according to him, the assessee would not be entitled to any depreciation. There was a further appeal to the Tribunal and it was contended on behalf of the assessee that the provisions of the 1961 Act were not retrospective and interpretation of section 43 should be such as would be applicable to contributions received in the accounting years relevant for the assessment year 1962–63 and thereafter. It was further contended that if the definition of the 1961 Act was applied in respect of asset acquired in earlier years it would amount to making the Act retrospective in operation for which there is neither any express provision nor any necessary implication in the Act. It was further urged that if such retrospective effect was given certain anomalies would result with reference to the assets acquired in the earlier years. It was on the other hand contended by the revenue that the intent and purpose of the legislation was that from the relevant year the 1961 Act should be applied. The Tribunal after considering the relevant contentions came to the conclusion that the provisions of sections 43(1) and 43(6) of the Income-tax Act, 1961, should be applied with reference to the assessment year 1962–63 and depreciation had to be calculated by taking into account the provisions of the Act of 1961 with reference to all the assets in use in that year. It, accordingly, confirmed the order of the Appellate Assistant Commissioner. In the premises, under section 256(1) of the Income-tax Act, 1961, the following question has been referred to this court:
“Whether, on the facts and in the circumstances of the case, depreciation could be computed on the basis of the definition of ‘actual cost’ and ‘written-down value’ in sections 43(1) and 43(6) respectively of the Income-tax Act, 1961, even with reference to the assets in use in the previous year for the assessment year 1962–63 but which were acquired prior thereto?”
5. The question with which we are concerned in this reference is how will the actual cost be determined in respect of an asset which had been acquired by the assessee in any year prior to the previous year relevant for the assessment in question? As mentioned hereinbefore, prior to the introduction of the 1961 Act “actual cost” had to be determined by deducting only the contribution made by the local authority and the Government, while under the present Act the contribution made by any other person including the consumer would have to be deducted in computing the actual cost. Good deal of arguments were advanced before the Tribunal as well as before us on the question whether the particular legislation was retrospective in effect and whether such retrospective effect could be given effect to in the scheme of the Income-tax Act and to the relevant section with which we are concerned. Counsel for the assessee contended that the concept of “actual cost” was inseparably connected with the time of acquisition of an asset. Therefore, an asset which had been acquired at a particular point of time and whose cost had been computed according to the tax laws relevant at that time could not, in the scheme of the Income-tax Act, be recomputed again differently in view of the changes made. According to counsel for the assessee, the effect of the new introduction of the 1961 Act was that the contributions made by consumers or other persons after the coming into operation of the then 1961 Act would have to be deducted; but the contributions that had been made prior thereto and the cost of assets which had been computed excluding those contributions could not be recomputed again for the purpose of calculating the depreciation to which the assessee was entitled.
6. The question of depreciation arises in determining the taxable income of an assessee. The computation of income of an assessee and the chargeability of such income will have to be determined under the scheme of the Income-tax Act and in accordance with the relevant provisions of the Act. We are concerned with an assessment year for which the assessee was claiming certain depreciation. The question is whether the assessee is entitled to such depreciation and, if so, at what rate and for that purpose the determination of the actual cost, if any, is necessary. That determination of actual cost in the relevant year is relevant for computing the income of the assessee in question. As we have noted, section 43 defines certain items and clearly stipulates that unless the context otherwise requires the meaning given to the expression in section 43 will have to be given effect to after the coming into operation of the 1961 Act. Therefore, the computation of actual cost for the purpose of determination of depreciation which the assessee is entitled to in computing the taxable income of the assessee must be in terms of section 43(1). The expression “actual cost” is defined as meaning the actual cost of the asset to the assessee reduced by that portion of the cost, if any, as had been met directly or indirectly by any other person including the consumer. The written-down value of an asset which is necessary for the determination of the value of an asset for computation of the depreciation is also provided in section 43(6) of the 1961 Act. So far as clause (a) of section 43(6) is concerned, it is clear that in the case of the asset acquired in the previous year, the actual cost to the assessee would be the actual cost as defined in section 43(1) of the Act. The question with which we are concerned is whether in the case of clause (b) where the written down value has to be determined in respect of an asset acquired before the previous year, the actual cost would be something different than the method followed in clause (a) of section 43(6). Section 43(6)(b) provides that in the case of an asset acquired before the previous year the written down value of the asset would be the actual cost to assessee less depreciation actually allowed to him under the 1961 Act or under the 1922 Act or under any other executive order issued under the Income-tax Act, 1886. It was argued by counsel for the assessee that actual cost in respect of this asset with which we are concerned had been determined in the previous year taking into consideration the definition prevalent at that time, namely, deducting from the cost the contributions made by a local authority or a Government but not deducting the contributions made by the consumers and thereafter depreciation had been allowed on such actual cost determined. Therefore, the written down value, according to counsel for the assessee, of the particular asset in the relevant assessment year, was the written down value to which the assessee had enjoyed depreciation under the Indian Income-tax Act, 1922. The specific mention of depreciation actually allowed under the Indian Income-tax Act, 1922, in clause (b) of section 43(6) indicated, according to counsel for the assessee, that the written down value had to be determined by deducting the actual cost as was determined with reference to the 1922 Act. We are, however, unable to accept this contention. It appears to us that in respect of an asset acquired prior to the year previous to the relevant assessment year the asset might have enjoyed depreciation under the 1922 Act. That depreciation should also be excluded. It is to safeguard this that the reference had to be made to the depreciation allowed under the Indian Income-tax Act, 1922, in clause (b) of section 43(6) of the Act.
7. We are unable to accept the position that actual cost so determined for the particular asset, according to the prevalent law, cannot be altered or redetermined as would be necessary for the purpose of the assessment for a particular year. That would not, in our opinion, amount to giving retrospective effect to any legislation nor would the same affect any vested rights of the assessee. It is not in dispute that each year's income-tax assessment is a self-contained assessment and there is no question of any res judicata or estoppel by way of previous years; assessment, indeed the changing laws of income-tax have subjected certain kinds of income to different assessments though it was earned in respect of transactions taking place prior to the relevant year. In this connection we may refer to the decision in the case of Maharana Mills (Private) Ltd. v. Income-tax Officer, [1959] 36 ITR 350 (SC). This case though it dealt mainly with the question of the power of the Income-tax Officer to rectify the mistake apparent on the record under section 35 of the Indian Income-tax Act, 1922, and the jurisdiction of the officer to recompute the previous year's determination of actual cost or written down value, the Supreme Court reiterated the position that there was no question of estoppel or res judicata in respect of determination of one year for the following years. The other case on which the Tribunal had relied also reiterated more or less the same principle, i.e, the decision in the case of Karnani Industrial Bank Ltd. v. Commissioner of Income-tax, [1954] 25 ITR 558 (Cal).
8. Counsel for the assessee contended before us that if actual cost in respect of an asset acquired prior to the relevant previous year had to be re-determined in the manner as contemplated by the 1961 Act the same would result not only in certain anomalies but would lead to absurdities and could not be given effect to. He argued first that it would result, as the Tribunal has observed, in having a negative written down value which was absurd and depreciation could not be calculated on the negative written down value. Written down value and depreciation are not used as having ordinary dictionary meaning but have certain statutory meanings. According to the provisions of the Act these expressions are used for certain purposes. In this case specially written down value is used for the purpose of calculating depreciation so long as the assessee is entitled to it. If after giving certain depreciation or calculating the written down value a figure is arrived at on which no depreciation could be calculated, that is to say, an asset becomes valueless to be entitled to the depreciation and as such to be entitled to deduction of that depreciation, the question of having a negative or minus figure really does not arise. Therefore, we are unable to accept this argument that the question of any inconvenience or anomalies arises on this aspect of the matter. Counsel further contended that if we took into consideration Explanation 2 to section 43(1), which we have set out hereinbefore, it would also be apparent that the result would be absurd. It was contended that in the case of an asset acquired by an assessee by gift or inheritance, the actual cost to the assessee should be, according to the Explanation, the written down value thereof “as in the case of the previous owner for the previous year in which the asset is acquired”. It was contended that the value as in the case of the previous owner for the previous year in which the asset was so acquired, could only mean the actual cost as determined for the relevant year on acquisition, that is to say, in this case the actual cost to be determined according to the 1922 Act. We are, however, unable to agree with this contention because the actual cost for the purpose of assessments coming into operation subsequent to the operation of the 1961 Act must be the actual cost as defined in sub-section (1) of section 43, even in respect of an asset which is acquired by the assessee by way of gift, the value of the same would have written down value as in the case of the previous owner in the previous year, that would be computed in accordance with the concept of actual cost as contemplated in the 1961 Act. Similarly, we are unable to agree with the contention that Explanation 4 also would result in certain amount of absurdity and anomaly. Counsel for the assessee drew our attention to the relevant provisions of section 34(2) and section 32(3) and contended that these provisions would become really inapplicable. We are, however, unable to accept this position. This, as we have mentioned, will not affect the determinion made in respect of the years prior to the coming into operation of the 1961 Act but for all determination of the assessments coming into operation of the 1961 Act the computation of the actual cost must be in accordance with the relevant provisions of the 1961 Act. In this connection our attention was drawn to Halsbury's Laws of England, 3rd edition, volume 22, pages 796-797, Craies on Statute Law, 7th edition, pages 287, 291, Maxwell on the Interpretation of Statutes, 12th edition, page 215, Colquhoun (Surveyor of Taxes) v. Brooks, [1889] 2 TC 490 (HL), Perry (EM. Inspector of Taxes) v. Astor, [1935] 19 TC 255, 283 (HL) and R.B Jodha Mal Kuthiala v. Commissioner of Income-tax, [1971] 82 ITR 570 (SC), on the question that in case of absurd result the court should lean against absurd construction and should also, if necessary, in order to give effect to the legislative intent, supply an omitted word. While we are in agreement with the propositions as advanced by learned counsel for the assessee, we are unable to accept the position that in this case any absurdity would result as indicated before or the legislative intent would be defeated if the plain meaning of the expression “actual cost” or “written down value” as contemplated by the 1961 Act be given effect to. The view we have taken is in consonance in our opinion with the principles enunciated in the case of Maharajah of Pithapuram v. Commissioner of Income-tax, [1945] 13 ITR 221 (PC) and the decision of this court in the case of Reliance Jute Mills Co. Ltd. v. Commissioner of Income-tax, [1972] 86 ITR 570 (Cal).
9. In the view that we have taken the question referred to us must be answered in the affirmative and in favour of the revenue. Each party will pay and bear its own costs.
Pyne, J.:— I agree.
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