THE NEW PIECEGOODS BAZAR CO., LTD.,BOMBAY vs THE COMMISSIONER OF INCOME-TAX,BOMBAY

The Supreme Court held that municipal property tax under Section 212 of the City of Bombay Municipal Act, 1888, qualifies as an 'annual charge not being a capital charge' under Section 9(1)(iv) of the Indian Income-tax Act, 1922, allowing for its deduction in income computation. Similarly, urban immoveable property tax under the Bombay Finance Act, 1939, is also deductible. The Court defined 'capital charge' as a charge for a capital sum and 'annual charge' as one for an annual liability, affirming the deductibility of the taxes in question.