57_juridical Pronouncement (Case Law) Relating to Salaries

8/9/2019 57_juridical Pronouncement (Case Law) Relating to Salaries

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pronouncement

relating to

SALARIELARIES

. .C o u rte sy | m an m o h an kolkata@ g m ailco m


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Convile vs. CIT (1935) 3 ITR

404

Salary is the recompense or

consideration given to a personfor the pains he has bestowed

upon anothers business

. .Courtesy | manmohan kolkata@gmail com


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CIT vs Govinda swaminathan233 ITR 264 (Mad)

Government, even thoughhe receives retainer fee

and his contract for servicedepends on pleasure of theGovernor. Such retainer feeshall be taxable under thehead Profits and gains ofbusiness or profession.


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CIT vs Dr. Mrs. Usha Verma (P&H-2002)

allowed to work in the payingclinic run in the college at

some share of fee from suchclinic. Such share of feereceived by employee-doctors

shall be taxable as salary,because the authority to work inthe clinic, fee of the clinic, share

of doctors, etc. were prescribedby the employer.


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CIT vs. M.N. Nadkarni (1986) 161ITR 544(BOM)

Amount of scholarship givenby employer company to

children to its employee solelyat its discretion without

reference to terms ofemployment is not assessableas perquisites.


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Justice Deoki Nandan Agarwal vsUnion of India, 237 ITR 872 (SC)

Remuneration received

by judges is taxableunder the headSalaries even though

they are not having anyemployer.


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Justice Deoki Nandan Agarwal vsUnion of India, 237 ITR 872 (SC)

Remuneration received by judges is taxable under thehead Salaries even though

they are not having anyemployer.


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Gestetner Duplicators (P.) ltd.vs CIT [1979] 117 ITR 1 (SC)

Salary & Wages areidentical in the

Income-tax Act


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Reade v. Brearley (1933) 17 TC-687

Salary income

must be real andnot fictitious


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CIT vs. Gian Singh Kalasi (1980)(Del)

earned by an

employee, itssubsequent waiverdoes not make itexempt from taxliability.


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CIT vs. Bawa Singh Chauhan(1984)150 ITR 8 (Delhi)

accommodation by theemployer , he will bechargeable to tax eventhough he does notutilize theaccommodation (at hisown will)


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Sardar Arjun Singh Allhuwaliavs CIT (1980) 124 ITR 347 (MP)

with retrospective effect

which have not beentaxed in the past, sucharrears will be taxed in

the year in which it isallowed.


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Raghunathan (T.M.) vs CIT(1998) 231 ITR 826 (Mad)

The reduction in salary ofan employee cannot beeffected withretrospective effect. Such

reduction can operateonly prospectively.


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CIT vs Thiagaraja Chetty & Co.(1953) 24 ITR 525 (SC)

For computation of

salary, method ofaccounting followed

by employee isirrelevant.


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CIT vs Savitaben N Amin (Smt.)(1986) 157 ITR 135 (Guj)

a Managing Directorretired and reappointed,

then it shall not betreated as termination of

service for the purpose ofcomputation of gratuityetc.


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CIT Vs. Kamal Devi [1971] 81ITR 773 (Delhi).

u/s 16 is permissible

even if the amountreceived asentertainment allowance

is not proved to havebeen spent


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CIT vs P.M. Mehra (1993) 201ITR 930 (Bom).

of service appearing in sec.10(10) should be interpreted

to mean the employees totalservice including service

under former employer(s),provided he was not paidgratuity by the former

employer(s)


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- Lachman Dass Vs. CIT [1980]

124 ITR 706 (Delhi).

,the time of partition. He sufferedloss of personal movable

property in Pakistan due to

partition. He applied to hisemployer for compensating himfor such loss. Certain payments

were given to him ascompensation. It was held thatsuch payments should not be

taxed as profit in lieu of salary

ens on rece e rom


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CIT vs. Janaki Loganathan(2002) 257 ITR 620 (Mad.)

ens on rece ve romUnited NationsOrganisationis not taxable.Further, pension received bya widow of the United

Nations ex-officials from UN Joint Staff Pension Fund isalso exempt.


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Mutual Acceptance Co. vs. FCT(1944) 69 CLR 389

Allowance means fixed

quantum of money givenregularly in addition tosalary to meet particular

requirement.


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perquisiteBishamber DayalVs. CIT[1976] 103 ITR 813

(MP).

Compensatory allowance

received by judge underArticle 222(2) of theConstitution is not taxable

since it is neither salary norperquisite


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CIT vs S.S.M. Lingappan (1981)7Taxmann 71 (Mad.)

Perquisite may becontractual or voluntary

perquisites .


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CIT vs C. Kulandaivelu Konar(1975) 100 ITR 629 (Mad.)

benefit from employment

can be taxed asperquisite. A benefitderived by unauthorised

means shall not betaxable.


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Dr. Reddy laboratories Ltd.vs. ITO 58 ITD104

Fixed amount paid to

employees by way ofleave travel allowance

shall not be exempt u/s10(5).

Th l l


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Arvind Bhogilal vs. CIT(1976) 105 ITR 764 (Bom.)

The legalrepresentative is not

liable for payment oftax on income that has

not accrued to thedeceased till his death.

57_juridical Pronouncement (Case Law) Relating to Salaries

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