Tax exemption under Section 15B applies only to amounts included in the relevant year's assessable income.

Exemption under Section 15B of the Income-tax Act, 1922 applies only to sums included in the assessable income of the relevant year and otherwise chargeable to tax. Amounts drawn from earlier years, past savings, or other funds not forming part of that year's assessable income fall outside the scope of the exemption. The scheme distinguished such amounts from income excluded under Section 4(3), while Section 16(1)(a) confirmed that Section 15B exemptions still operate within the assessment computation. On that basis, sums of earlier-year origin were not eligible for exemption under Section 15B(1) read with the proviso to Section 15B(2).

---

---

Issues: Whether sums contributed from earlier years and not included in the assessable income of the relevant year were entitled to exemption under Section 15B(1) of the Income-tax Act, 1922.

Analysis: The exemption under Section 15B operates only in respect of sums on which tax would otherwise be payable in the relevant assessment year. The scheme of the Act distinguishes between amounts excluded from total income under Section 4(3) and amounts included in assessable income but exempted from tax under Section 15B. Section 16(1)(a) confirms that sums exempted under Section 15B are nevertheless brought into computation for assessment purposes. Amounts paid out of past savings or earlier year funds, and not forming part of the income assessable for the relevant year, cannot be the subject of an exemption claim for that year.

Conclusion: The assessees were not entitled to exemption in respect of the sums of Rs. 12,078 and Rs. 10,764 under Section 15B(1) read with the proviso to Section 15B(2) of the Income-tax Act, 1922.

Ratio Decidendi: Exemption under a tax-exemption provision is available only for amounts included in the assessable income of the relevant year and otherwise chargeable to tax.

---