Commissioner Of Income-Tax vs Smt. Maya J. Daryani
1998 Latest Caselaw 45 Del

Citation : 1998 Latest Caselaw 45 Del
Judgement Date : 14 January, 1998

Delhi High Court

Commissioner Of Income-Tax vs Smt. Maya J. Daryani on 14 January, 1998

Equivalent citations: 1998 231 ITR 554 Delhi

Author: R Lohati

Bench: R Lahoti, D Bhandari

JUDGMENT

R.C. Lohati, J.

1. This is a reference under Section 256(1) of the Income-tax Act, 1961, made at the instance of the Revenue, arising out of assessment year 1982-83, seeking the opinion of the High Court on the following question of law :

"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that cash incentive of Rs. 31,35,832 received by the assessee was not a revenue receipt and thus not taxable ?"

2. It appears that in the relevant assessment year, the assessee had received cash incentive to the tune of Rs. 31,35,832. It was taxed as a revenue receipt. In the appeal, preferred by the assessee before the Tribunal, the assessee sought leave of the Tribunal to raise the plea that the receipt being of capital nature, was not liable to be taxed. The Tribunal vide para 6 of its appellate order, permitted the plea to be raised being purely of a legal nature. Relying on its own earlier decision in another case, the Tribunal held that the cash incentive received by the assessee was capital in nature and, accordingly, it was not taxable as a revenue receipt.

3. Learned senior standing counsel for the Revenue has invited our attention to certain statutory amendments which have been given retrospective effect and according to which the amount shall be taxable as a revenue receipt. It is pointed out that the Finance Act, 1990, has added Clause (iiib) in Section 28 of the Act, the effect of which is that cash assistance (by whatever name called) received or receivable by any person against exports under any scheme of the Government of India is to be treated as income chargeable to income-tax under the Act. Sub-clause (vb) has been added in Clause (24) of Section 2 of the Act, whereby any sum chargeable to income-tax under Clause (iiib) of Section 28 has been included in the definition of income. These amendments though introduced by the Finance Act, 1990, have been given a retrospective effect with effect from April 1, 1967. The assessment year 1982-83 would be covered by the amendment.

4. In view of the statutory amendments, the question is answered in the negative i.e., in favour of the Revenue and against the assessee.