Income recovered post-Supreme Court ruling deemed taxable despite arguments of double taxation or damages.

The court ruled against the assessee, determining that the Rs. 15,000 accrued income recovered after a Supreme Court judgment was taxable in the assessee's hands. The court rejected arguments of double taxation and that the amounts should be treated as damages, affirming that the income rightfully belonged to the assessee and was liable for taxation. The court held that the receiver's possession of the income was lawful and not considered as damages, ultimately deciding in favor of taxing the recovered amounts as the assessee's income.

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Issues:
1. Characterization of Rs. 15,000 accrued to the assessee in the assessment years 1952-53 and 1953-54.
2. Tax liability on the Rs. 15,000 received by the assessee after a Supreme Court judgment.
3. Double taxation concerns raised by the assessee.
4. Whether the amounts deposited by the assessee can be considered as damages.

Detailed Analysis:
1. The judgment concerns the characterization of Rs. 15,000 accrued to the assessee in the assessment years 1952-53 and 1953-54, which were recovered after a Supreme Court judgment. The assessee entered into an agreement to purchase a tile factory but faced legal disputes. The Supreme Court restored the decree in favor of the assessee, declaring him entitled to the profits derived from the factory during the assessment years. The receiver, appointed by the court, received Rs. 15,000 each year as profits from the factory, which was later recovered by the assessee.

2. The tax liability on the Rs. 15,000 received by the assessee was contested during the assessment. The Income-tax Officer included the amount in the assessee's total income, considering it as mesne profits awarded by the Supreme Court. The assessee argued that the amount had already been taxed in the hands of another party and that it should be treated as damages, not income. However, both the revenue and the Tribunal rejected these objections, stating that the amount was rightfully the assessee's income and liable to be taxed in his hands.

3. The issue of double taxation was raised by the assessee, claiming that the amount had already suffered tax in the hands of another party. The court dismissed this argument, emphasizing that the Supreme Court had affirmed the assessee's ownership of the factory and the right to the income, making the receipts by the receiver on behalf of the assessee's income. Therefore, it was not a case of double taxation as the income was rightly chargeable to the assessee.

4. Regarding the characterization of the amounts deposited by the assessee, the court ruled that they could not be considered as damages. The possession of the receiver was lawful, as ordered by the court, and held on behalf of the rightful owner determined by the civil courts. The court concluded that the receipts by the receiver were not in the nature of damages, affirming that they constituted income chargeable to tax in the hands of the assessee.

In conclusion, the court answered both references against the assessee, emphasizing the tax liability on the recovered amounts as income and rejecting claims of double taxation or the amounts being treated as damages.

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