9911796707
TMI Blog2008 (6) TMI 629X X X X Extracts X X X X X X X X Extracts X X X X ..... that petitioners are entitled to receive interest payment from Banks, Treasuries etc. without deduction of income tax at source under Section 194A(1) of the Income Tax Act. 2. I have heard learned counsel appearing for petitioners and learned Standing Counsel appearing for respondents. 3. The claim of the petitioners is that petitioners are entitled to receive payment of interest without deduction of tax at source by virtue of their inclusion under Clause 22 of Notification No.SO 3489 dated 22-10-1970 issued by the Central Government under Section 194A(3)(f) of the Act. Learned standing counsel on the other hand contended that petitioners are not covered under Clause 22 of the Notification above referred and therefore payment of intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... welfare legislations in these cases can be treated as a statutory corporation referred to in Clause 22 of the Notification above referred. The statutes, under which the Boards of Trustees of the petitioners are created, are essentially welfare legislation for collection of funds from employees and employers for payment to employees at the time of death, retirement etc. The Board of Trustees are constituted only to administer the fund in terms of the statute. Learned counsel for petitioners referred to the provisions of the Act, whereunder Government retains control in the matter of administration of statute, which includes even nomination of trustees. However, I do not think the controls exercised by the Government such as nomination of Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Central Board of Direct Taxes for exemption and orders are awaited. I feel, the interest receivable on the funds of petitioners is only accretion to the fund and if it is taxed, the same will probably affect the interests of the beneficiaries, who are the employees. Besides this, the fund is constituted of contribution from employees and employers. Therefore, I feel it is a fit case for the State Government to take up the matter to Central Government, so that a policy decision is taken with regard to the claim of exemption by various Boards, which have the same object. Petitioners will, therefore, approach the Secretary, Department of Labour, State Government, for him to take up the matter with the Central Finance Minister and the Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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