Judgment MUDHOLKAR, J. : These are appeals by special leave from three orders against an order passed on March 12, 1954, by the Custodian-General, Evacuee Property disposing of three revision petitions, two of which were preferred by one Bharoo Mal (since deceased) and one by his wife, and now widow, Padma Devi. Even though a common order was passed by the Custodian-General, three appeals have been preferred before this Court. 2. The facts leading up to the appeals are briefly as follows : 3. An agreement was entered into between Bharoomal and one Nanan Begum on April 11, 1948, for the exchange of Bharoomal s properties at Sukkar in Sind, Pakistan for Nanan Begum s properties at Lucknow. Prior to that, on April 7, 1948, a similar agreement was entered into between Padma Devi and one Tahir Ali. It is common ground that in pursuance of the agreement Bharoomal and Padma Devi entered into possession of the properties obtained by them in exchange from Nanan Begum and Tahir Ali respectively and the latter entered into possession of the properties belonging to the former situated in Sukkar. The deed of exchange was to be executed within two years of the date of agreement; but in fact it was never executed. Consequently in the year 1950 Bharoomal and Padma Devi instituted three suits for specific performance. These suits were decreed and sale deeds conveying certain properties to Bharoomal and certain properties to Padma Devi were executed by the Court in February, 1952. 4. In October 1949, the U. P. Administration of Evacuee Property Ordinance, 1949 (I and 1949) was promulgated and shortly thereafter the Administration of Evacuee under the provisions of the Income-tax Act of 1922 (hereinafter termed the Act) was dissolved on March 24, 1945, and from the day following that, i. e., S. S. Miranda & Co. Ltd. succeeded to the business of the firm. A claim made under s. 25(4) of the Act to the effect that no tax was payable on the profits of the registered firm for the period between April 1, 1944 to March 24, 1945, was allowed. In respect of the chargeable accounting period April 1, 1944 to March 24, 1945, the registered firm was taxed to Excess Profits Tax under the Excess Profits Tax Act, 1940. In respect of the chargeable accounting period April 1, 1944 to March 24, 1945, the registered firm was taxed to Excess Profits Tax under the Excess Profits Tax Act, 1940. It also deposited as required certain sums of money under S. 10 of the Finance Act, 1942, read with S. 2 of the Excess Profits Tax Ordinance, 1943. In accordance with those provisions the firm became entitled to repayment of a portion of the Excess Profits tax amounting to a sum of Rs. 2,35,704/-. The shares of the three partners who are respective appellants in the three appeals were James Miranda Rs. 58,926/-, Donald Miranda Rs. 58,926/- and Mrs. N. Q. Miranda Rs. 1,17,854/-. It was submitted that the amount refunded was business profit and therefore exempt from tax under S. 25(4) of the Act. The Income-tax Officer rejected that submission and the share of each of the appellants was assessed to income-tax and super-tax and the balance after deducting the same he repaid to each of the partners but he computed the rate applicable to the tax by including the appellants total business income which was exempt under S. 25(4) of the Act. On appeal this assessment was confirmed but on further appeal the Income-tax Appellate Tribunal held that the sum which was refunded was income from business and was therefore exempt from business and therefore exempt from income-tax under S. 25(4) of the Act. At the instance of the Commissioner of Income-tax, the Tribunal referred the following question of law for the opinion of the High Court : "Whether the repayment of excess profits tax made by the Central Government in pursuance of S. 10 of the Indian Finance Act 1942, or S. 2 of the Excess Profits Tax Ordinance, 1943, is profits from business for the purposes of S. 25(4) of the Indian Income-tax Act?" 3. The High Court held that the amount so refunded was income from other sources taxable under S. 12 of the Act and the appellants were, therefore, not entitled to the benefit of S. 25(4) of the Act. In dealing with the nature of the tax the learned Chief Justice said :- "Clearly the view of the Legislature was that this income should be treated as a statutory income with the consequences that must necessarily follow by reason of its being a statutory income." 4. In dealing with the nature of the tax the learned Chief Justice said :- "Clearly the view of the Legislature was that this income should be treated as a statutory income with the consequences that must necessarily follow by reason of its being a statutory income." 4. It was argued on behalf of the appellants that the amount refunded was income, profits and gains from business and fell under S. 10 of the Act and fell under S. 10 of the Act and was therefore exempt under S. 25(4) of the Act. For the determination of this question it is necessary to refer to the relevant provisions of the Excess Profits Tax Act, 1940, and the Finance Act, 1946. Section 12(1) of the Excess Profits Tax Act was, as follows :- S. 12 (1) "The amount of the excess profits tax payable in respect of a business for any chargeable accounting period diminished by any amount allowable by way of relief under the provisions of S. 11 or S. 11-A shall, in computing for the purposes of income-tax or super-tax the profits and gains of that business, be allowed to be deducted as an expense incurred in that period." 5. The relevant part of S. 11(11) of the Finance Act 1946, provided :- "Any sum being excess profits tax repaid in respect of any chargeable accounting period under the provisions of S. 10 of the Indian Finance Act, 1942, or of S. 2 of the Excess Profits Tax Ordinance, 1943 (XVI of 1943), shall be deemed to be income for the purposes of the Indian Income-tax Act, 1922, and shall, notwithstanding the provisions of S. 34 of that Act be treated as income of the previous year which constitutes or includes the chargeable accounting period in respect of which the said sum is repayable: Provided that any such sum repaid in respect of any profits which are also assessable to excess profits tax under the law in force in the United Kingdom shall be treated, for the purpose of assessment to income-tax and super-tax, as income of the previous year during which the repayment is made." 6. It is not necessary to quote S. 10(1) of the Finance Act, 1942, or the relevant provisions of the Excess Profits Tax Ordinance, 1943. It is not necessary to quote S. 10(1) of the Finance Act, 1942, or the relevant provisions of the Excess Profits Tax Ordinance, 1943. Section 12(1) of the Excess Profits Tax Act shows that the amount of Excess Profits Tax payable in respect of a business for any chargeable accounting period was an allowable expenditure. Under S. 11(11) of the Indian Finance Act, 1946, any excess profits refunded under the provisions of Indian Finance Act, 1942, or of S. 2 of the Excess Profits Tax Ordinance, 1943, were deemed to be income and were to be treated as income of the previous year which constituted or which included the chargeable accounting period in respect of which the said sum was repayable. Thus the sum repaid was to be treated as income for the purposes of the Act against the Custodian. There is nothing in this sub-rule which further entitles the Custodian to determine and recover rents and profits from an unauthorised occupant of evacuee property. Sub-rule (2) of R. 10 empowers the Custodian to issue a notice to a tenant or a licensee in possession of evacuee property whom the Custodian cannot eject or does not want to eject. For one thing this sub-rule cannot apply to a person who is alleged to be in unauthorised occupation of evacuee property. Then again it does not confer any power on the Custodian to determine rents and profits or to recover rent in a summary manner. In the circumstances we must hold that this provision also does not help the respondent. Such being the legal position, we must quash and set aside that portion of the order of the Custodian, confirmed by the Custodian General, which requires the appellants to pay rents and profits in respect of properties of Nanan Begum and Tahir Ali in their possession. Both parties will, however, be at liberty to take such steps as may be open to them at law for establishing or enforcing their respective claims. 9. Costs of the appeal will be borne by the respondents. As the appeals were argued together there will be only one hearing fees. Order partly quashed. For Citation : AIR 1961 SC 1283 = (1962) 1 SCJ 52 = 1962 All. W.R. (H.C.) 42. Vikas Info Solutions Pvt. Ltd.