Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | 1956-ss. 209 Schedule VI Parts I and II. and as being in excess of the powers conferred upon Central Government-Held: Rule is neither ultra vires nor inconsistent with the provisions of the Companies Act- D Rules and the Act form part of the composite scheme-Rules are supplementary to the Act and constitute a legitimate aid to the construction of the provisions of the Act-Rules also not suffering from the vice of excessive delegation-Companies Act 2006: Accounting for taxes on income-Accounting Standard 22 (AS 22)-Adoption of-By the Rules framed by Central Government- Challenged as being ultra vires the provisions of Companies Act so far as it related to 'deferred taxation 642 641 Companies (Accounting Standards) Rules 211 (3A) and (3C) |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Companies (Accounting Standards) Rules, 2006:Accounting for taxes on income - Accounting Standard 22 (AS 22) - Adoption of - By the Rules framed by Central Government - Challenged as being ultra vires the provisions of Companies Act so far as it related to 'deferred taxation; and as being in excess of the powers conferred upon Central Government - Held: Rule is neither ultra vires nor inconsistent with the provisions of the Companies Act - Rules and the Act form part of the composite scheme - Rules are supplementary to the Act and constitute a legitimate aid to the construction of the provisions of the Act - Rules also not suffering from the vice of excessive delegation - Companies Act, 1956 - ss. 209, 211 (3A) and (3C), 641, 642, Schedule VI Parts I and II.Accounting Standard 22 - Provisions relating to 'deferred taxation' - Whether violative of Articles 14 and 19(1)(g) of the Constitution - Question left open - Constitution of India, 1950 - Articles 14 and 19(1)(g).Companies Act, 1956 - s. 642(1) - Rule making power of Central Government - Scope of.Delegated Legislation - Scope of - Held: Valid only when it is confined to legislative policy and guidelines.Doctrines/ Principles - Doctrine of ultra vires - Applicability of.Words and Phrases - 'delegated legislation' - Meaning of.Accounting Standard 22 (AS 22) titled as "Accounting for taxes on income", issued by Institute of Chartered Accountants in 2001 had been made mandatory for all companies listed in stock Exchanges of India in preparation of their accounts for the financial year 2001-02 onwards. Central Government by a Notification dated 7.12.2006 prescribed AS 22 u/s 211 (3C) of the Companies Act, 1956, in consultation with National Advisory Committee on Accounting Standards, by enacting Companies (Accounting Standards) Rules, 2006. In the present appeals AS 22 was challenged, alleging that it was inconsistent with and ultra vires the provisions of Companies Act, 1956, Income Tax Act, 1961 and the Constitution of India, 1950, insofar as it relates to deferred taxation. The questions for determination before this Court were:1. Whether Companies (Accounting Standards) Rules, 2006, adopting AS 22 was in excess of the powers conferred upon Central Government u/s 642 (1) of the Companies Act, 1956?2. Whether AS 22 was inconsistent with the provisions of Companies Act, 1956? |
Judge | Honble Mr. Justice S.H. Kapadia |
Neutral Citation | 2007 INSC 1161 |
Petitioner | J.k. Industries Ltd. & Anr |
Respondent | Union Of India And Ors. |
SCR | [2007] 12 S.C.R. 136 |
Judgement Date | 2007-11-19 |
Case Number | 3761 |
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