Allahabad High Court
Commissioner Of Income-Tax vs Modipon Limited (No. 1) on 11 May, 1990
Equivalent citations: [1991]189ITR344(ALL)
Author: B.P. Jeevan Reddy
Bench: B.P. Jeevan Reddy
JUDGMENT
1. In this application filed under Section 256(2) of the Income-tax Act, 1961, the Revenue is asking us to direct the Tribunal to state the following four questions of law :
"(1) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the premium for personal accident insurance policy in respect of the managing director could not be considered to be a perquisite within the meaning of Section 40(c) of the Income-tax Act, 1961 ?
(2) Whether, on the facts and in the circumstances of the case the Income-tax Appellate Tribunal was correct in law in holding that the retainership fees did not represent payment in connection with representation before the income-tax authorities envisaged under Section 80VV of the Income-tax Act ?
(3) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in directing the Income-tax Officer to calculate the disallowance under Rule 6D with reference to the total journeys undertaken in a year and not with reference to each journey undertaken by an employee or director on a day to day basis ?
(4) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the provisions of Rule 6D do not apply to a foreign technician who is not an employee ?
2. We may first dispose of questions Nos. 2 and 3 since they are covered by earlier orders of this court.
3. Question No. 2 : In I. T. A. No. 170 of 1986 an identical question was asked to be referred as question No. 3 but it was declined by this court. Following the said order, we also decline to direct the second question to be stated.
4. Question No. 3 : An identical question was asked to be referred as question No. 4 in I. T. A. No. 170 of 1986 and it was allowed by this court. Accordingly, this question is allowed.
5. Now, we come to question No. 1. On hearing learned standing counsel for the Revenue, we are of the opinion that this question ought to be referred.
6. Question No. 4 : We do not think that this question arises from the order of the Tribunal and ought to be referred for the opinion of this court. The Tribunal was right in holding that Rule 6D does not apply to a foreign technician who is not an employee of the assessee.
7. The result of the above discussion is that the following two questions are directed to be stated by the Tribunal under Section 256 of the Act. :
"(1) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the premium for personal accident insurance policy in respect of the managing director could not be considered to be a perquisite within the meaning of Section 40(c) of the Income-tax Act ?
(2) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in directing the Income-tax Officer to calculate the disallowance under Rule 6D with reference to the total journeys undertaken in a year and not with reference to each journey undertaken by an employee or director on day-to-day basis ?"
8. Accordingly, the income-tax application is allowed in part. It is rejected in so far as the other two questions are concerned.