1999 (10) TMI 4

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....rs 1946-47 and 1947-48 ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the remuneration received by the assessee from the Kalyanmal Mills Ltd. in the assessment years 1966-67 and 1967-68 pursuant to the final decree passed in favour of the assessee on December 14, 1965, could not be held to be income of the assessee which had accrued to him in the years 1946-47 and 1947-48 ?" There was a difference of opinion between the two learned judges who heard the reference under section 256(1) of the Income-tax Act, 1961. One learned judge answered both questions in favour of the Revenue and the other learned judge answered both questions in favour of the assessee. By reason of the di....

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....he assessee for the assessment years 1966-67 and 1967-68 respectively. The income-tax authorities and then the Tribunal held that the relationship between the mills and the assessee was that of master and servant and that the said amounts that had been paid to him were taxable under the head "Salary". Arising out of the order of the Tribunal, the two questions aforementioned were placed before the High Court for consideration. That the relationship between the mills and the assessee was that of master and servant and that the said amounts had been received by the assessee as salary is not in dispute. The question really is whether clause (a) of section 15 of the Income-tax Act, 1961, applies, as contended by learned counsel on behalf of ....

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....o tax in the assessment years 1946-47 and 1947-48, they became liable to tax in the years in which they were paid to the assessee by the mills. Section 15 must be read harmoniously. It is clear that the amounts of salary that were payable by the mills to the assessee in the previous years relevant to the assessment years 1946-47 and 1947-48 could have been brought to tax in those assessment years, whether paid or not. The point is that they were not made chargeable to tax in those years. The said amounts were paid to the assessee only in the previous years relevant to the assessment years 1966-67 and 1967-68. The question is whether they are caught by the net created by the said clause (c). We do not see any justification for holding tha....