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TMI Blog1994 (11) TMI 128X X X X Extracts X X X X X X X X Extracts X X X X ..... is salary income could be computed only after excluding the amount paid to his ex-wife by way of alimony to her and maintenance expenses to their minor son?" The assessee is an individual. The reference relates to the assessment year 1969-70, the corresponding previous year being the previous year ended on March 31, 1969. In the return for the assessment year 1969-70, the assessee claimed deduction from his income from salary of a sum of Rs. 7,800 paid by him to his ex-wife by way of alimony to her and maintenance expenses to their minor son. The above amount was paid to her by the employers under instructions from the assessee out of the salary of the assessee. According to the assessee, it was a case of diversion of income by overriding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o his wife with effect from April 1, 1968, a sum of Rs. 300 per month by way of permanent alimony plus a sum of Rs. 290 per month for maintenance of his minor son, Jamsheed, whose custody was given to his wife and sum of Rs. 60 per month as salary for the servant of the minor child. Total sum thus payable amounted to Rs. 650 per month or Rs. 7,800 per annum. No specific charge was created for payment of this amount by the consent decree. (ii) The assessee was employed as general manager of Premier Auto Electric Ltd. and derived his salary from the said company. He also had income from dividends, interest, etc. After the passing of the consent decree, the assessee wrote a letter to his employers informing that he has been granted divorce by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; CIT v. Crawford Bayley and Co. [1977] 106 ITR 884 and CIT v. Mulla and Mulla and Craigie, Blunt and Caroe [1991] 190 ITR 198. According to learned counsel for the Revenue, there is no diversion of income by overriding title in the instant case. It is clearly a case of application of income by the assessee for payment of alimony to his. wife. Deduction from his salary or the payment of the amount by the employers to his ex-wife after deduction from his salary is only the manner of payment of the alimony to his ex-wife. The question of diversion of income by overriding title does not arise in the instant case. In support of his contention reliance is placed on the decision of this court in CIT v. V. G. Bhuta [1993] 203 ITR 249. We have ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of alimony to his ex-wife and maintenance of his minor child. The direction to the employers or the agreement with the employers to pay the agreed amount of Rs. 650 per month to the ex-wife every month is only a mode of payment. It does not in any way amount to diversion of salary income before it accrues to the assessee. The employers are obliged to pay the amount only after the salary income accrues to the assessee and becomes payable to him. It is at that point of time that the employers have agreed or undertaken to pay as per the wishes of the assessee the sum of Rs. 650 per month to his ex-wife. The employers have only agreed to deal with the amount of salary accrued to the assessee in such manner as directed by him. It is, in ou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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