1974 (3) TMI 11

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.... J. K. House, Calcutta, allowed by the J.K. Jute Mills Co. Ltd. to the assessee is a perquisite or benefit obtained in the relevant accounting year within the meaning of section 2(24)(iv) and its value is assessable in the hands of the assessee for the assessment years 1962-63, 1963-64 and 1964-65 ?" The facts leading to the present reference briefly stated are that the assessee, L.Lakshmipat Singhania, was a director of J. K. Jute Mills Co. Ltd. in the years 1955-56 and 1956-57. He resigned as a director in the year 1956. Later on he was appointed as a financial adviser to the J.K. Jute Mills Co. Ltd. and was allowed free use of the company's premises known as J. K. House at 12, Alipur Road, Calcutta, vide company's resolution dated Apr....

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....ends that L. Lakshmipat Singhania obtained this perquisite as financial adviser. In this connection the fact that he was related to one of the directors of the company was immaterial. Hence, the perquisite obtained by the assessee could not be treated as his income under section 2(24)(iv). We are unable to accept this submission. The section merely provides that if any relation of a director derives the benefit or perquisite from a company it will be deemed to be his income. It does not state that the income should be derived by a relation in any particular capacity. This distinction becomes obvious because of the use of the word " benefit derived by a relation of the director " instead of " the benefit or perquisite derived in the capacity....