Place of receipt for income tax: money first credited outside British India was not taxable on later transfer

For section 4(1) of the Income-tax Act, 1922, receipt occurs at the first occasion when the recipient gets money under his own control. Because the lump sum was first paid and credited at Hyderabad, a later transfer to the assessee's account at Patna did not make it an original receipt in British India. The amount also did not fall within any deeming provision treating it as received in British India. It was therefore received outside British India and was not chargeable to income tax.

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Issues: Whether the lump sum paid to the assessee was received in British India so as to be taxable under the Income-tax Act, 1922.

Analysis: The amount was first paid and credited at Hyderabad and was only later transferred to the assessee's account at Patna. For the purpose of section 4(1), receipt means the first occasion when the recipient gets the money under his own control. A later transfer into British India does not amount to an original receipt there. The amount did not fall within the provisions deeming certain business profits or professional fees to be received in British India, and no other deeming provision applied.

Conclusion: The sum was received outside British India and was not chargeable to income tax.

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