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TMI Blog1993 (9) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... ar relevant to the assessment years 1972-73, 1973-74 and 1974-75, the assessee received certain amounts by way of "interest" from the First National City Bank and the Chartered Bank. The assessee claimed exclusion of the said amounts in the computation of its "chargeable profits" under the Companies (Profits) Surtax Act, 1964. The claim of the assessee was rejected by the Inspecting Assistant Commissioner who made the assessment. The assessee went in appeal before the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals) upheld the order of the Inspecting Assistant Commissioner. On further appeal to the Income-tax Appellate Tribunal, the Tribunal decided in favour of the assessee. It was held that the assessee was entitled to the exclusion of the amounts received by it from the Indian branches of the two foreign banks. in the computation of its "chargeable profits" by virtue of clause (x) of rule 1 of the First Schedule to the Surtax Act. Hence this reference at the instance of the Revenue. The controversy before us revolves round the interpretation of clause (x) of rule 1 of the First Schedule to the Surtax Act. The facts of the case are not in dispute. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submissions. We find it difficult to accept the contention of the assessee that the condition regarding the source of receipt is not applicable to "interest". The expression "any" preceding the word "interest", in our opinion, is common to both "interest" and "fees". It is a well-settled rule of interpretation that a statutory provision has to be read as a whole in the context in which it appears. Words indicative of any exclusion or condition, in the absence of any intention to the contrary, have to be given full effect. If we read clause (x) of rule 1 of the First Schedule as a whole, it is abundantly clear that it deals with two types of receipts--one, receipts by way of "any interest" and another, receipts by way of "fees for rendering technical services". The condition specified therein that such receipts should be from Government or a local authority or any Indian concern applies to both types of receipts. This qualifying phrase is not intended to qualify "fees" alone but applies equally to "interest" referred to in the said rule. The expression "any" applies to both "interest" and "fees" which means "any interest" or "any fees for rendering technical services". The conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... branch of the Mercantile Bank Ltd., which was a non-resident company incorporated outside India, was a unit by itself managed by a local manager who had sufficient powers to manage it and hence this unit which carried on business in India can be held to be an "Indian concern". On a reference at the instance of the Revenue, the High Court reversed the finding of the Tribunal and held that the Mercantile Bank Ltd. being incorporated outside India and it being a non-resident company, its branch cannot be treated as an "Indian concern". It was observed (at page 737) : " .... the expression used in the statutory provision is 'Indian concern' and not 'concern in India'. If the expression used is 'a concern in India', it may be said that a mere geographical location in India or the situs of the concern in India is sufficient to bring the concern within the scope of the expression 'Indian concern'. On the other hand, the expression used is not 'a concern in India', but 'an Indian concern'. This different expression derives significance from the fact that there are provisions in the Income-tax Act where the statute uses the expression 'industrial undertaking in India' and not 'Indian indu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia cannot be deducted under clause (x) of rule 1 of the First Schedule to the Surtax Act. In that view of the matter, we answer the question in the negative, i.e., in favour of the Revenue. Before parting with the case, we deem it necessary to deal with one more contention of the assessee that the Tribunal having not given any decision on the interpretation of the expression "Indian concern" appear ing in clause (x) of rule 1, this court should not decide this point itself but remand the matter to the Tribunal with a direction to decide it afresh. We have considered the above submission of learned counsel for the assessee. We, however, do not find any merit in it. The question of law in issue between the parties in this case is whether the interest received by the assessee from the Indian branches of foreign banks could be excluded in computing the chargeable profits for the purpose of surtax under clause (x) of rule 1 of the First Schedule. The answer to this question depends on the interpretation of clause (x) of rule 1. Whether the branches of foreign banks situated in India can be said to be "Indian concerns" or not is one of the essential aspects of the question which was al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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