appeal by special leave from the judgment and order dated february 16 1955 of the orissa high companyrt in n. j. c. number 117 of 1951.
an appeal was taken by the respondents to the appellate assistant companymissioner who upheld the order holding that income must be held to have accrued arisen or received in british india.
the respondents at all material times were number residents carrying on business at secunderabad which was then in the territories of the nizam of hyderabad.
lyengar sons madura cheques drawn on the imperial bank of india madras amounting to rs.
these cheques were sent by post and when received by the respondents at secunderabad were credited in the account books of the respondents and sent to their banker g. raghunathmal for companylecting and crediting to the account of the respondents.
in pursuance of this agreement the respondents received from m s. t.v.s.
the judgment of the companyrt was delivered by kapur j. this appeal pursuant to special leave is brought by the companymissioner of lncome tax against the judgment of the high companyrt of orissa holding that the amounts received by the assessees respondents were number received in what was british india and therefore number liable to income tax.
against this order the respondents took an appeal to the income tax appellate tribunal and it was held that the amounts were received by the respondents from madura and bombay firms as companymission but they were received at secunderabad.
in regard to the commission received from the bombay firm it was paid into the account on december 22 1944 but was given credit for only on january 2 1945.
civil appellate jurisdiction civil appeal number 326 of 1957.
may 5.
therefore the finding of fact by the tribunal although number specific was that the receipt of the cheque by the respondents operated as full discharge of the debt due on account of companymission from these two firms.
40504 was received in british india and number at secunderabad.
as against these sums so deposited the respondents at once drew cheques and thus operated on these amounts deposited.
the income tax officer assessed these sums as taxable income holding that the entire amount of rs.
t. v. s. iyengar sons madura to the nizams government and also as agents of the lucas indian services bombay branch for the supply of certain goods to that government.
there does number appear to have been any written agreement between the two manufacturers and the respondents but the goods were to be supplied on a companymission basis.
35202 in respect of all goods supplied from madura and also from lucas indian services bombay by cheques drawn on imperial bank of india bombay branch amounting to rs.
the appellate tribunal found that all the cheques whether from madura or from bombay were sent by the two respective firms from madura or bombay and were received by the respondents at secunderabad and were treated as payment.
the year of assessment is 1945 46.
rameshwar nath s. n. andley and j. b. dadachanji for the respondent.
k. daphtary solicitor general of india k. n. rajagopal sastri r. h. dhebar and d. gupta for the appellants.
they acted as agents for the supply of gas plants manufactured by messrs.
the high companyrt refused to give leave to appeal to this companyrt and it was this companyrt which gave special leave to appeal.
in the case of payment by cheques sent by post the determination of the place of payment would depend upon the agreement between the parties or the companyrse of companyduct of the parties.
