1974 (2) TMI 9 - HC - Income Tax

Summary

Issues:
Interpretation of section 10(6)(i) of the Income-tax Act, 1961 regarding exemption of passage money received by an individual for family members during home leave.

Detailed Analysis:

The case involved the interpretation of section 10(6)(i) of the Income-tax Act, 1961, regarding the exemption of passage money received by an individual for family members during home leave. The specific question referred to the court was whether the passage money of Rs. 1,525 paid to the assessee by his employer for his son's trip from India to the U.K. was exempt under the mentioned section. The assessee, Mr. G.B. Shuttleworth, had received this amount for his son's travel during the relevant assessment year of 1969-70. The Income-tax Officer initially rejected the claim, but the Appellate Assistant Commissioner and the Tribunal ruled in favor of the assessee, upholding his claim under section 10(6)(i).

Section 10(6)(i) of the Income-tax Act provides for the exclusion of certain income, including passage money received by an individual for themselves, spouse, and children in connection with proceeding on home leave out of India. The Central Government had not prescribed any specific conditions under this section. The Board of Revenue had issued a circular in 1958, which was assumed to apply in this case. The primary issue before the court was whether the passage money received by the assessee for his son's trip from India to the U.K. qualified as passage money in connection with his home leave.

The Appellate Assistant Commissioner had already found that the passage money was indeed received by the assessee in connection with his home leave. The Tribunal also confirmed this finding. The court noted that there was no question raised challenging this finding before them. Therefore, the court's decision was in favor of the assessee and against the Department, affirming the passage money exemption under section 10(6)(i) for the son's trip.

The court rejected the Revenue's argument that the section required the initial journey to originate from India to a foreign country, emphasizing that the section's requirements had been met in this case. The court also discussed the possibility of a child not being in existence at the time of the employee's journey, stating that such a child would still be entitled to the passage money. Additionally, complex questions regarding the interpretation of the section were raised at the bar, including whether the employee's actual journey was necessary for the exemption to apply, but the court did not address these issues in this case.

In conclusion, the court ruled in favor of the assessee, directing the Department to bear the costs, including counsel fees. The judgment would be communicated to the Appellate Tribunal as required by the Income-tax Act.