Standard deductions not separate for each job, total salary considered. Court rules for Revenue.

The court held that the assessee was not entitled to separate standard deductions for each employment under section 16(i) of the Income-tax Act, as the deduction should be based on the total salary received from all employers, not exceeding the specified limit. The court's decision was in favor of the Revenue and against the assessee, concluding that separate standard deductions for each employment were not permissible under the Act.

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Issues:
Interpretation of section 16 of the Income-tax Act, 1961 regarding standard deductions for multiple employments.

Analysis:
The case involved a dispute regarding the entitlement to separate standard deductions in respect of salary received from two different employers during the assessment year 1978-79. The assessee claimed separate standard deductions under section 16 of the Income-tax Act, 1961, for the salaries received from two employers. The Income-tax Officer allowed only one deduction of Rs. 1,000, while the appellate authority allowed the maximum standard deduction of Rs. 3,500 as per section 16(i)(b) of the Act. The Income-tax Appellate Tribunal, however, accepted the assessee's contention for separate standard deductions of Rs. 3,500 and Rs. 1,000, relying on a decision of the Bombay Bench of the Tribunal.

The court observed that section 16 of the Income-tax Act was retrospectively amended in 1984, clarifying that where an assessee receives salary from multiple employers, the standard deduction should be computed based on the aggregate salary received and should not exceed the specified amount under the section. Therefore, the amendment applied to the case at hand for the assessment year 1978-79. The court held that the assessee was not entitled to separate deductions for each employment under section 16(i) as the deduction should be based on the total salary received from all employers, not exceeding the specified limit.

The court cited decisions of the Madhya Pradesh High Court in support of its interpretation, emphasizing that the standard deduction under section 16 should be calculated based on the aggregate salary received by the assessee from all employers. The court answered the question referred by the Income-tax Appellate Tribunal in the negative, in favor of the Revenue and against the assessee, concluding that separate standard deductions for each employment were not permissible under section 16 of the Income-tax Act, 1961.

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