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Commissioner of Income-tax Vs. B.R. Tuli, Ex-judge, Punjab and Haryana High Court - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtPunjab and Haryana High Court
Decided On
Case NumberIncome-tax Reference Nos. 58 to 61 of 1979
Judge
Reported in[1980]125ITR460(P& H)
ActsIncome Tax Act, 1961 - Sections 10(13A); Income Tax Rules, 1962 - Rule 2A
AppellantCommissioner of Income-tax
RespondentB.R. Tuli, Ex-judge, Punjab and Haryana High Court
Appellant Advocate D.N. Awasthy and; B.K. Jhingan, Advs.
Respondent AdvocateParty in person
Excerpt:
.....the act. so viewed two inferences are clear viz., (1) sections 80 and 89 of the act read with rule 85 of the rules make it obligatory for the authorities making the order to communicate it to the applicant concerned and (2) the period of limitation for any appeal against the order is reckonable from the date of such communication of the reasons would imply communication of a copy of the written order itself, a party who knows about the making of an order cannot ignore the same and allow grass to grow under its feet and do nothing except waiting for a formal communication of the order or to choose a tenuous plea that even though he knew about the order, he was waiting for its formal communication to seek redress against the same in appeal. if a party does not know about the making of..........another argument, which was pressed into service, was that sub-rules (a), (b), (c) and (d) of rule 2a of the rules were to be interpreted disjunctively because of the use of the word ' or ' and not ' and ' occurring after each sub-rule. it was pleaded that there is no requirement of law or limitation that expenses must actually be incurred. it was pleaded that if the assessee incurs a loss thereby disentitling himself for the receipt of rent of his house, to which he was entitled in case he had not occupied his house himself, the provisions of section 10(13a) of the act read with rule 2a of the rules, shall stand satisfied. the pleas raised by the assessee were accepted by the aac.4. the revenue filed an appeal before the tribunal which appeal was dismissed. the tribunal held that.....
Judgment:

B.S. Dhillon, J.

1. The following question of law arising out of the order of the Income-tax Appellate Tribunal, Chandigarh Bench, Chandigarh (hereinafter referred to as ' the Tribunal '), in respect of I.T. A. Nos. 153, 145, 493 and 494 of 1977-78, for the assessment years 1972-73 to 1975-76, respectively, has been referred to us by the Tribunal at the instance of the revenue :

'Whether, on the facts and in the circumstances of the case, the Tribunal erred in law in holding that the amount received by the assessee on account of house rent allowance was not liable to be included in his taxable income for each of the four years '

2. The brief facts giving rise to these references may thus be stated. The assessee, Mr. Justice B. R. Tuli (as he then was), a retired judge of the Punjab and Haryana High Court, received Rs. 2,520 as house rent allowance (hereinafter shortly referred to as ' HRA '), for each of the first three years under reference and for the fourth year Rs. 2,488 as a sitting judge of the High Court, The HRA was subjected to tax by the ITO in each of the four years on the ground that the respondent (Shri B. R. Tuli) lived in his own house at No. Ml, Sector 9-B, Chandigarh, and that he was not entitled to exemption of the said amount from income-tax under the provisions of Section 10(13A) of the I.T. Act, 1961 (hereinafter referred to as ' the Act ') read with Rule 2A of the I.T. Rules, 1962 (hereinafter referred to as ' the Rules ').

3. On appeal filed by the assessee before the AAC, it was pleaded that the exemption of HRA was wrongly disallowed as the assessee by living in his own house and by paying tax on the annual letting value of the self-occupied house, actually incurred expenditure within the meaning of Section 10(13A) of the Act. It was pleaded that refusal of exemption of the HRA was in the nature of double taxation. The AAC's attention was invited to an assessment order framed in the case of Mr. Justice D. K. Mahajan, where, under similar circumstances, the HRA was not taxed. Another argument, which was pressed into service, was that Sub-rules (a), (b), (c) and (d) of Rule 2A of the Rules were to be interpreted disjunctively because of the use of the word ' or ' and not ' and ' occurring after each sub-rule. It was pleaded that there is no requirement of law or limitation that expenses must actually be incurred. It was pleaded that if the assessee incurs a loss thereby disentitling himself for the receipt of rent of his house, to which he was entitled in case he had not occupied his house himself, the provisions of Section 10(13A) of the Act read with Rule 2A of the Rules, shall stand satisfied. The pleas raised by the assessee were accepted by the AAC.

4. The revenue filed an appeal before the Tribunal which appeal was dismissed. The Tribunal held that there cannot be a dispute regarding the proposition that the rules framed under a statute acquire the same importance as statutory provisions. It was conceded before the Tribunal by the learned counsel for the revenue that there is no conflict between the provisions of Section 10(13A) of Act and Rule 2A of the Rules, framed under the Act. It was found by the Tribunal that in the case of Mr. Justice D. K. Mahajan the revenue granted similar exemption.

5. In a similar case, I.T. Ref. Nos. 85 to 88 of 1979 (CIT v. Justice S. C. Mittal) , pertaining to another learned judge of this court, we have answered a similar question, as has been referred to us in this case, in the negative, i.e., against the revenue and in favour of the assesseee.

6. For the reasons recorded in I.T. Ref. Nos. 85 to 88 of 1979, we answer the question referred to us in the negative, i.e., against the revenue and in favour of the assessed, with costs.

Gokal Chand Mittal, J.

7. I agree.


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