RAJPUTANA MINING AGENCIES LTD. vs UNION OF INDIA AND ANOTHER.

The Supreme Court ruled that the Indian Income-tax Act, 1922, as amended by the Income-tax (Amendment) Act, 1953, applies to Part B States, including Rajasthan, effective from April 1, 1950. The Court held that the withdrawal of exemption under Section 14(2)(C) for the assessment year 1950-51 retroactively affected income from the previous year 1949-50, thus making it taxable. The Court clarified that Parliament had the authority to enact tax laws for newly integrated territories, and the amendment obliterated the prior exemption as if it never existed.