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Commissioner Of Income-Tax, Madras vs V. Mr. P. Firm, Muar on 26 October, 1964

5.8 Further, in view of the fact that after June 2005 onward the assessee has charged markup at the rate of 6 percentile on the cost and has offered to tax as income as FTS, the learnedCounsel submitted that in view of the decision of the Hon'ble Supreme Court in the case of CIT Vs MRP Firm, Muar (1965) 56 ITR 67 (SC), wherein it is held that the doctrine of 'approbate and reprobate' is only a species of estoppel and applies only to the 14 ITA No.1437 & 1438/Del/2012 & 5444/Del./2010 conduct of the parties. As in the case of the estoppel, it cannot operate against the provision of the statute. If a particular income is not taxable under the Income-tax Act, it cannot be taxed on the basis of the estoppel or any other equitable doctrine. Equity is out of the place in the tax law, aparticularincome is either eligible to tax under the tax statute or it is not. If it is not, the ITO has no power to impose tax on the said income. Accordingly, the learnedCounsel submitted that question involved in present case on whether cost reimbursement received by the assessee during assessment year 2005-06 and 2006-07 satisfy make available condition under Article 12 will have to be decided in accordance with law without being influenced by the extraneous factors like in subsequent years by adopting a different model receipt or offered to tax in India.
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