Google
 

Thursday, January 10, 2008

The consensus seems to be that when the Government engages

The consensus seems to be that when the Government engages itself in trading ventures, particularly as Government companies under the company law, it does not do so as a political State or political Government, but it does so in the garb and essence as a company. A Government company is not a department of the Government. In Andhra Pradesh State Road Transport Corporation Vs. ITO AIR 1964 SC 1486, the Andhra Pradesh Road Transport Corporation claimed exemption from taxation by invoking Article 289 of the Constitution of India according to which the property and income of the State are exempted from the Union taxation. The Supreme Court, while rejecting the Corporation’s claim, held that though it was wholly controlled by the State Government, it had a separate entity and its income was not the income of the State Government. Similarly, in Western Coalfields Umited Vs. Special Area Development Authority AIR 1982 SC 696, the Supreme Court did not uphold the contention of the Western Coalfields Ltd. and Bharat Aluminium Company Ltd. (the petitioners) that they were wholly owned by the Government of India and so the companies could not be subjected to property tax.

No comments: