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TMI Blog1999 (9) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... sis that "annual value" represents rent for one year, it was contended by the assessee that the property should exist for a whole year to be liable to tax. As the property existed for less than a year, the assessee claimed the income as non-taxable. The Assessing Officer did not accept the plea ; but the Commissioner of Income-tax (Appeals) (in short, the CIT(A)), allowed claim of the assessee. The Revenue preferred a second appeal before the Tribunal. By order dated October 7, 1993, the Tribunal held that it is "income from property", but since it is not covered by the term "annual value", such income from property cannot be assessed under that head. However, since all incomes are to be subjected to tax under the scheme of the Act, the said income is chargeable under the head "Other sources". While directing so, the Tribunal directed the Assessing Officer to consider the question relating to allowability of expenses by way of municipal taxes or otherwise against the rental income from the property. Though three questions were proposed by the assessee for reference, only one question as referred to above has been referred. Learned counsel for the assessee submitted that taking in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b) any allowance granted to the assessee either to meet his personal expenses at the place where the duties of his office or employment of profit are ordinarily performed by him or at a place where he ordinarily resides or to compensate him for the increased cost of living ; (iv) the value of any benefit or perquisite, whether convertible into money or not, obtained from a company either by a director or by a person who has a substantial interest in the company, or by a relative of the director or such person, and any sum paid by any such company in respect of any obligation which, but for such payment, would have been payable by the director or other person aforesaid ; (iva) the value of any benefit or perquisite, whether convertible into money or not, obtained by any representative assessee mentioned in clause (iii) or clause (iv) of sub-section (1) of section 160 or by any person on whose behalf or for whose benefit any income is receivable by the representative assessee (such person being hereafter in this sub-clause referred to as the 'beneficiary') and any sum paid by the representative assessee in respect of any obligation which, but for such payment, would have been pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder any of the heads specified in section 14, items A to E. (2) In particular, and without prejudice to the generality of the provisions of sub-section (1), the following incomes shall be chargeable to income-tax under the head 'Income from other sources', namely:--- (i) dividends ; (ia) income referred to in sub-clause (viii) of clause (24) of section 2; (ib) income referred to in sub-clause (ix) of clause (24) of section 2; (ic) income referred to in sub-clause (x) of clause (24) of section 2, if such income is not chargeable to income-tax under the head 'Profits and gains of business or profession' ; (id) income by way of interest on securities, if the income is not chargeable to income-tax under the head 'Profits and gains of business or profession' ; (ii) income from machinery, plant or furniture belonging to the assessee and let on hire, if the income is not chargeable to income-tax under the head 'Profits and gains of business or profession' ; (iii) where an assessee lets on hire machinery, plant or furniture belonging to him and also buildings, and the letting of the buildings is inseparable from the letting of the said machinery, plant or furniture, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its Tax (Amendment) Act, 1947, had inserted section 12B of the Indian Income-tax Act, 1922. Section 12B imposed a tax on capital gains. The validity of the said amendment was questioned on the ground that tax on capital gains is not a tax on 'income' within the meaning of entry 54 of List I, nor is it a tax on the capital value of the assets of individuals and companies within the meaning of entry 55 of List I of the Seventh Schedule to the Government of India Act, 1935. The Bombay High Court repelled the attack. The matter was brought to this court. After rejecting the argument on behalf of the assessee that the word 'income' has acquired, by legislative practice, a restricted meaning---and after affirming that the entries in the Seventh Schedule should receive the most liberal construction----the court observed thus: 'What, then, is the ordinary, natural and grammatical meaning of the word "income" ? According to the dictionary it means "a thing that comes in" (See Oxford Dictionary, Volume V, page 162 ; Stroud, Volume II, page 1416). In the United States of America and in Australia both of which also are English speaking countries the word "income" is understood in a wide sens ..... X X X X Extracts X X X X X X X X Extracts X X X X
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