Instances of the Application of the Mischief Rule

  1. M.D. Chamarbaughwala v. Union of India

FACTS:

  1. Whether the definition of ‘prize competition’ in the Prize Competition Act, 1955 includes:
  2. competitions in which success depends on chance
  3. competitions in which success depends on substantial degree of skill
  4. The Act further stated that to promote and conduct these prize competitions exceeding Rs. 1,000 must obtain a license for the same.
  5. The Act therefore could not be supported by Article 19 (1) (g) of the Constitution of India as gambling was prohibited under the same.

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HELD:

“Having regard to the history of the legislations, the objects of the legislation and wording of the statute, we are of the opinion that the competitions which are to be controlled and regulated by the Act are only those competitions in which success does not depend on a substantial degree of skill”

  1. Commissioner of Income Tax v. Sodra Devi

FACTS:

There existed a partnership firm with Ms. Sodra Devi and her 3 minor sons as partners. It was questioned as to whether the income of the three minor sons was to be included in her income for the purposes of tax.

Section 16(3) of the Act provides :

“In computing the total income of any individual for the purpose of assessment, there shall be included – (a) so much of the income of a wife or minor child of such individual as arises directly or indirectly :

(ii) from the admission of the minor to the benefits of the partnership in a firm of which such individual is a partner”

HELD:

The legislature certainly was guilty of using an ambiguous term in enacting s. 16(3) of the Act as it did. In order to resolve this ambiguity therefore we must of necessity have resort to the state of the law before the enactment of the provisions; the mischief and defect for which the law did not provide; the remedy which the legislature resolved and appointed to cure the defect.

Before the enactment of the sub-section, there was no provision for the inclusion of the income of a wife or a minor child in the computation of the total income of an individual.

The Apex Court held that individual only meant males on perusal of the statements and objects of the act as decided by the judiciary, however, it was not possible for the courts to fill the gaps in a fiscal statute.

Post Contributed By:

Abhishek Bhargava

Indian Institute of Legal Studies

 

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