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Assessability of amount received by executors as income for the assessment year 1958-59. Analysis: The judgment by the High Court of Bombay addressed a reference made by the Tribunal under the Indian Income-tax Act, 1922, regarding the assessability of an amount of Rs. 41,471 received by the executors of a deceased individual's estate for the assessment year 1958-59. The deceased individual, Shri Frank Summersgill, had an agreement with a company where he was entitled to a monthly salary and commission on goods sold by the company. Upon his death, a sum representing one year's commission was paid to the executors. Litigation between the legal heirs and executors resulted in a court declaration that the amount belonged to the estate and was to be administered by the executors. The Income-tax Officer included this amount in the assessment of the executors, but the Appellate Assistant Commissioner excluded it, deeming it a capital receipt. The Tribunal upheld this decision, stating that the amount was received by the estate based on the agreement with the deceased, not from any profit activity by the executors. The Court noted that the amount was part of the estate, as declared by the court earlier, and estate duty was paid on it. Considering these factors and the agreement's clauses, the Court concluded that the amount received by the executors was of a capital nature and not assessable as income for the relevant assessment year. In conclusion, the Court answered the question in the negative, ruling in favor of the assessees (executors) and directing the revenue to pay the costs of the reference to the assessees.
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