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TMI Blog2015 (5) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... l within the charging section. - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... e added to the total income in the respective years with the aid of Section 176(4) of the Income Tax Act. However, both the authorities concerned upheld the said addition made by the Assessing Officer for the year 1998 - 1999. The Revenue being aggrieved came up with the following question of law :- "Whether the Appellate Tribunal is right in law and on facts in holding that professional fee received by the assessee after the alleviation to the post of Judge of the Hon'ble High Court is not taxable u/s. 4 read with section 176(4) of the I.T. Act?" 4. The challenge is based on interpretation of Section 176(4) of the Income Tax Act, which reads as under :- "Discontinued business. (4) Where any profession is discontinued in any year on account of cessation of the profession by, or the retirement or death of, the person carrying on the profession, any sum received after the discontinuance shall be deemed to be the income of the recipient and charged to tax accordingly in the year of receipt, if such sum would have been included in the total income of the aforesaid person had it been received before such discontinuance." Section 4 of the Income Tax Act reads as under :- Charg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in the case of Justice R.M. Datta has been delivered by the Division Bench of Calcutta High Court whereas the decision of Andhra Pradesh High Court relied on by the Assessing Officer has been given by a Single Judge. The ITAT Chandigarh Bench had considered both the decisions of Calcutta High Court and Andhra Pradesh High Court as under :- There is no getting away from the fact that a decision by a High Court which may not be the jurisdictional High Court, which is only direct and existent decision, has to be given its due weight and respect. The decision of Calcutta High Court in the case of Justice R.M. Dutta (supra) was a comprehensive decision which dealt with the issue in its entirety and in all its facts. It is a settled position of Law, as observed by the Supreme Court in the case of CIT vs. Elphinstone Spg. & Wvg. Mills Co. Ltd. (1960) 40 ITR 142 that if the works of a taxing statute fail, then so must be tax. The Calcutta High Court has simply shown in its judgment in the case of Justice R.M. Datta (Supra) that the words of section 176(4) do fail in as much as all the three fictions necessary for bringing such arrears of professional fees to tax are not there; se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer added ₹ 13,93,630/- for A.Y. 1998-99 and ₹ 4,52,277/- for A.Y. 1996- 97. The assessee pointed out a judgment of Hon'ble Calcutta High Court in the case of CIT Vs. Justice R.N. Dutta (180 ITR 86) in support of the note given alongwith the return of income. The A.O. was of the view that section 176 was introduced to bring under the purview of taxable income of such receipts. The A.O. noticed that on the issue the decision cited by the assessee, Calcutta High Court is not only the decision on the issue. The Hon'ble A.P. High Court had clearly decided on a parallel case wherein such receipts were clearly held to be taxable in the case of V. Parthasarathy Vs. Addl. CIT 103 ITR 508. The A.O. has also noted that there are contrary judicial pronouncement on a similar/identical case and thus in view of the Supreme Court's decision if there exists no contrary decision of any other High Court, the decision of any High Court territorial or otherwise should be accepted, does not find favour in the case of the assessee. The A.O. has also gone through the decision of ITAT in the case of Justice Kuldip Singh Vs. ITO, decided by the ITAT, Chandigarh Bench, the A.O. o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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