The same was upheld, with minor modifications, by the High Court.
By reason of the difference of opinion, the reference was then heard by a third learned judge, the then Chief justice.
There was a difference of opinion between the two learned Judges who heard the reference under Section 256 1 of the Income Tax Act, 1961.
This has given rise to cross appeals by the Revenue and the assessee.
The Income Tax authorities and then the Tribunal held that the relationship between the Mills and the assessee was that of master and servant and that the said amounts that had been paid to him were taxable under the head of salary.
65, 532 between 1st April, 1966 and 31th March, 1967.
Pursuant thereto, the assessee was paid Rs.
Arising out of the order of the Tribunal, the two questions afore mentioned were placed before the High Court for companysideration.
Accounts having been taken, a final decree was passed on 14th December, 1965.
1999 Supp 4 SCR 135 The Judgment of the Court was delivered by P. BHARUCHA, J. The questions that were the subject matter of the impugned order of the High Court read thus Whether on the facts and in the circumstances, the tribunal is justified in law in holding that the income of assessee become liable to be assessed in the assessment years 1966 67 and 1967 68 and number in the years 1946 47 and 1947 48?
The amounts due to the assessee number having been paid, he filed a suit and the trial companyrt passed a preliminary decree for taking accounts.
10,000 between 1st April, 1965 and 30th March, 1966 and Rs.
These amounts were brought to tax in the hands of the assessee for the Assessment Years 1966 67 and 1967 68 respectively.
There were disputes between the parties and the agreement was terminated on 9th November, 1948.
Briefly stated, the facts are In January 1946 the late assessee, Arjun Singh Ahluwalia, entered into an agreement in the name of M s, Ahluwalia Sons with Kalyanmal Mills Ltd., Indore to sell to merchants all kinds of waste companyton of different qualities and quantities produced by the Mills on the terms and companyditions mat were companytained in the letter of the Managing Director of he Mills dated 2nd January, 1946.
One learned Judge answered both questions in favour of the revenue and the other learned judge answered both questions in favour of the assessee.
Whether, on the facts and in the circumstances of the case, the tribunal was justified in holding that the remuneration received by the assessee from the Kalyanmal Mills Ltd. in the assessment years 1966 67 and 1967 68 pursuant to the final decree passed in favour of the assessee on 14th December 1965, companyld number be held to be income of the assessee which had accruded to him in the years 1946 47 and 1947 48?
