1980 (2) TMI 25 - HC - Income Tax

Summary

Issues:
1. Interpretation of whether a salary amount accrued in India.
2. Validity of referring additional questions by a non-applicant before the Tribunal.

Interpretation of Salary Accrual:
The High Court addressed a question referred by the Income-tax Appellate Tribunal regarding the accrual of a salary amount in India. The Tribunal had previously ruled in favor of the assessee, stating that the salary amount did not accrue in India. The High Court, citing a previous decision, upheld the Tribunal's ruling in favor of the assessee, contrary to the revenue's stance.

Validity of Referring Additional Questions:
The Tribunal referred two additional questions at the instance of the assessee, despite the revenue's objection that the assessee, being a non-applicant, should not have been able to seek a reference on those questions. The High Court considered the objections raised by the revenue and referred to a recent Supreme Court decision. The Supreme Court's ruling clarified that only the party applying for a reference is entitled to specify questions for referral. As the Tribunal's order was partly in favor of the assessee, the High Court held that the additional questions should not have been referred to them. The High Court declined to answer the additional questions and emphasized the need for parties to follow proper procedures for references.

Conclusion:
The High Court's judgment addressed the interpretation of salary accrual and the validity of referring additional questions by a non-applicant. The Court upheld the Tribunal's decision in favor of the assessee regarding salary accrual. However, it ruled that the additional questions referred by the non-applicant should not have been considered, emphasizing the importance of following proper procedures for references. The judgment provides clarity on the process of seeking references and highlights the need for adherence to legal procedures in such matters.