Taxability of salary arrears: unpaid instalment not taxable in the earlier year if not paid or allowed by year-end. The unpaid second instalment of salary arrears from implementation of Sixth Pay Commission recommendations cannot be taxed in the assessment year corresponding to the financial year in which the arrears were not paid or allowed by the year end, because arrears of salary are chargeable to tax in the previous year in which they are paid or allowed under the payment or allowance principle.
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Provisions expressly mentioned in the judgment/order text.
Taxability of salary arrears: unpaid instalment not taxable in the earlier year if not paid or allowed by year-end.
The unpaid second instalment of salary arrears from implementation of Sixth Pay Commission recommendations cannot be taxed in the assessment year corresponding to the financial year in which the arrears were not paid or allowed by the year end, because arrears of salary are chargeable to tax in the previous year in which they are paid or allowed under the payment or allowance principle.
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