TaxTMI 
TaxTMI 
2008 (11) TMI 234
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....pay and allowance received as the Chief Minister and incidental expenses in the following manner : DETAILS OF PAY/ALLOWNACES AS CHIEF MINISTER Pay 23,539.85 Allowance 35,209.70 Sumptuary allowance 23,539.85 82,289.40 TDS reimbursed for financial year 1995-96 8,497.00 90,786.40 Less: Incidental expenses Depreciation on car (on opening WDV 64922 at 20%) 12,984.00 Insurance/expenses on car (estimated) 5,000.00 17,984.00 Net income 72,802.40 4. The Assessing Officer gave intimation to the assessee under section 143(1)(a) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). In the adjustment explanatory sheet, the Assessing Officer observed as follows : "1. The Ministers being Government servants are not covered by the Board's circular, therefore returns are to be filed under the head 'Salary' and not 'Income from other sources'. The correction has been made. 2. The only deduction allowable from salary income is standard deduction of Rs. 15,000. This has been allowed despite no claim. 3. Incident....
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....e linked to the rebate under section 88 claimed by the assessee on accrued interest of NSC which may be in the mind of the Assessing Officer, In view of the aforesaid, adjustment of Rs. 6,000 as made by the Assessing Officer is deleted." 7. The Revenue aggrieved by the order of the Commissioner of Income-tax (Appeals) deleting adding back of the interest on the National Savings Certificate, preferred appeal before the Patna Bench of the Income-tax Tribunal (hereinafter referred to as "the Tribunal"). It was registered as I. T. R. No. 438/PATY/1997. The assessee aggrieved by the change of head, filed cross-objection and that was registered as C. O. No. 92/PAT/1998. The appeal and the cross-objection naturally were heard together and have been disposed of by the Tribunal by the common judgment dated October 31, 2001. The Tribunal allowed the appeal preferred by the Revenue but dismissed the cross-objection filed by the assessee. On the issue of change of head, the Tribunal observed as follows : "The Chief Minister is not a political post. It is a constitutional post. The Assessing Officer had rightly stated that the fact that the assessee enclosed a service certificate to the r....
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....of income from other sources to salary is legal, valid and permissible under section 143(1)(a) ? 5. Whether the Tribunal was justified in allowing the appeal of the Department in I. T. A. No. 438/Pat/97, the filing of which violate the instruction No. 1979, dated March 27, 2000, issued by the Central Board of Direct Taxes ?" 11. Mr. Ajay Rastogi, appearing on behalf of the appellant, submits that the tax effect in the present case being Rs. 4,305, i.e., less than the monetary limit of Rs. 25,000 prescribed by the Central Board of Direct Taxes in its Notification dated October 28, 1992, the Revenue ought not to have preferred the appeal before the Tribunal and the Tribunal instead of deciding the same, ought to have dismissed the same on that ground alone. He points out that such a plea was raised before the Tribunal but has not been answered and without deciding the said issue, the Tribunal had allowed the appeal preferred by the Revenue. 12. Mr. Harshwardhan Prasad, appearing on behalf of the Revenue, does not dispute that the tax effect is only Rs. 4,305 but in view of the nature of issue involved the Revenue had filed the appeal and the Tribunal rightly did not dismiss ....
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.... and (4) shall apply accordingly." 14. From a plain reading of section 268A(1) of the Act, it is evident that the Central Board of Direct Taxes has been conferred power to issue order/instructions for the purpose of regulating filing of appeal or application for reference. Section 268A(5) further provides that order/instruction or direction issued by the Central Board of Direct Taxes fixing monetary limits for filing appeal shall be deemed to have been issued under sub-section (1) of section 268A of the Act. Thus, the instruction fixing monetary limit for filing of appeal before the Tribunal has statutory flavour and in the back-ground thereof, we are of the opinion that the appeal preferred by the Revenue against the order of the Commissioner of Income-tax (Appeals) was wholly unjustified. 15. Accordingly, our answer to the fifth question is in the negative, against the Revenue and in favour of the assessee and it is held that the Tribunal was not justified in entertaining the appeal of the Revenue. The view which we have taken finds support from a Division Bench judgment of this court dated September 15, 2008, passed in Misc. Appeal No. 90 of 2000 (CIT v. Uma Kant Mishra [2....
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....ssessing Officer prima facie came to the conclusion that the head shown by the assessee, is incorrect and hence nothing prevented him from changing the head of income from other sources to that of salary. 22. Rival submission necessitates examination of the scheme of section 14 of the Act. For the purpose of charge of income-tax, the total income has to be classified under various heads which include salaries and income from other sources. Section 14 of the Act, which is relevant for the purpose, reads as follows: "Save as otherwise provided by this Act, all income shall, for the purposes of charge of income-tax and computation of total income, be classified under the following heads of income : A. - Salaries B. - […….] C. - Income from house property. D. - Profits and gains of business or profession. E. - Capital gains. F. - Income from other sources." 23. Section 15 of the Act, inter alia, provides for charging of income under the head "salary" when it is due or paid by him. 24. Section 15 of the Act reads as follows: "The following income shall be chargeable to income-tax under the head 'Salaries'- (a) any salary due from an employer or a ....
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....c notification appoint. (1B) A member of the Legislative Assembly of a State or either House of the Legislature of a State having Legislative Council belonging to any political party who is disqualified for being a member of that House under paragraph 2 of the Tenth Schedule shall also be disqualified to be appointed as a Minister under clause (1) for duration of the period commencing from the date of his disqualification till the date on which the term of his office as such member would expire or where he contests any election to the Legislative Assembly of a State or either House of the Legislature of a State having Legislative Council, as the case may be, before the expiry of such period, till the date on which he is declared elected, whichever is earlier. (2) The Council of Ministers shall be collectively responsible to the Legislative Assembly of the State. (3) Before a Minister enters upon his office, the Governor shall administer to him the oaths of office and of secrecy according to the forms set out for the purpose in the Third Schedule. (4) A Minister who for any period of six consecutive months is not a member of the Legislature of the State shall at the expi....