Madras High Court
K.S. Srinivasan vs Commissioner Of Income-Tax And Anr. on 28 July, 1998
Equivalent citations: [1998]234ITR267(MAD)
JUDGMENT Jagadeesan, J.
1. The petitioner has filed these writ petitions seeking a writ of mandamus to quash the proceedings of the respondents whereby the petitioner was rejected the relief under Section 80U(1)(ii) of the Income-tax Act and directing the respondents to grant the said relief.
2. The case of the petitioner is that he is an employee in the Standard Chartered Bank, Madras, as assistant. He filed the income-tax returns for the years 1985-86, 1986-87 and 1987-88. After filing the returns, he claimed the benefit under Section 80U(1)(ii) of the Income-tax Act since the petitioner was a permanently physically disabled person afflicted with almost total deafness in both the ears. The petitioner filed a petition under Section 264 of the Income-tax Act before the first respondent, claiming the benefit and the same was rejected and the petitioner preferred an appeal before the second respondent which was also rejected, Hence, the present writ petition has been filed.
3. The respondents have filed counter contending that the petitioner is not entitled for the benefit of Section 80U(1)(ii) of the Income-tax Act, since the petitioner's permanent physical disability has not the effect of reducing substantially his capacity to engage in a gainful employment or occupation. The fact that the petitioner is employed and getting a four figure salary itself will establish that he is in gainful employment or occupation.
4. Learned counsel for the petitioner contended that Section 80U(1)(ii) of the Income-tax Act clearly specifies the persons who are entitled for the deductions and also the physical disability. Rule 11D framed under the said Act explains the permanent disability for the purpose of deduction under Section 80U and as per the rules where permanent deafness with hearing impairment of 71 decibels and above is there, such persons will be entitled for the deductions as provided under Section 80U(1)(ii) of the said Act. The petitioner has produced a medical certificate to the effect that the petitioner is suffering from hearing impairment of 80 decibels and as such the petitioner is entitled for the benefit of deduction in accordance with Section 80U(1)(ii) of the said Act. But for this disability, the petitioner would have got promotion. But only due to the permanent disability of deafness the petitioner was not promoted and thereby the petitioner has lost the opportunity of further promotions and further increments, Further due to the permanent disability the petitioner has lost the better employment and better earning. Hence, the petitioner is entitled for the deduction in accordance with Section 80U of the said Act. On the contrary, learned senior counsel for the respondents contended that Section 80U(1)(ii) of the said Act contemplates two conditions for getting deductions : one is permanent disability specified in the rules ; and the other is such permanent disability must be to the effect of reducing substantially the capacity to engage in a gainful employment or occupation.
5. So far as the compliance of the first condition is concerned there is no dispute. The authorities below have considered the fulfilment of the second condition and found that the petitioner has not fulfilled the second condition and as such he will not be entitled for the deduction. The petitioner is employed in a foreign bank and earning a sum of Rs. 5,000 p.m. and as such it cannot be said that the permanent disability is to the effect of reducing substantially his capacity to engage in a gainful employment or occupation.
6. I carefully considered the contentions of both counsel. Section 80U of the Income-tax Act is as follows :
"Deduction in the case of totally blind or physically handicapped resident persons-- (1) In computing the total income of an individual, being a resident, who, as at the end of the previous year--(i) is totally blind, or
(ii) is subject to or suffers from a permanent physical disability (other than blindness) being a permanent physical disability specified in the rules made in this behalf by the Board, and which has the effect of reducing substantially his capacity to engage in a gainful employment or occupation, or . . .
there shall be allowed a deduction of a sum of fifteen thousand rupees."
Rule 11D of the Rules framed under the Income-tax Act is as follows (see [1985] 155 ITR (St.) 86, 87) :
"Permanent physical disabilities for the purposes of deduction under Section 80U.--A. permanent physical disability shall be regarded as a permanent physical disability for the purposes of Clause (ii) of Sub-section (1) of Section 80U if it falls in any one of the categories specified below, namely :--. . .
(c) permanent deafness with hearing impairment of 71 decibels and above."
Section 80U(1)(ii) gives the benefit to those who are suffering from permanent physical disability specified in the rules and such permanent disability is to the effect of reducing substantially his capacity to engage in a gainful employment or occupation.
7. To get deduction as per this provision, as pointed out by learned senior counsel for the respondents, two conditions have to be fulfilled. One condition is that the person suffers from a permanent physical disability specified in the rules made in this behalf by the Board. The second condition is that such permanent disability has the effect of reducing substantially his capacity to engage in a gainful employment or occupation. Rule 11D provides an Explanation for the physical disability so far as the deafness is concerned. Rule 11D(c) specifies that the permanent deafness with hearing impairment of 71 decibels will amount to permanent physical disability.
8. In this case, the petitioner has produced the medical certificate which states that the petitioner has sensory nural deafness in both ears with hearing loss of 80 decibels. Hence, there is no dispute that the petitioner is suffering from permanent disability in accordance with Rule 11D. So far as this question is concerned learned senior counsel for the respondents also do not dispute. The question is whether the petitioner is entitled for the deduction since he had fulfilled Rule 11D. As pointed out already, the rule only explains the permanent disability. The rule cannot override the section. The requirement of Section 80U(1)(ii) is that not only the petitioner shall suffer from permanent disability as specified in the rules but also such permanent disability has the effect of reducing substantially his capacity to engage in a gainful employment or occupation. When the Legislature has used the words "reducing substantially his capacity to engage in a gainful employment or occupation", this would mean that the person who is suffering from permanent disability must be in a position that he is unable to get himself engaged in a gainful employment or occupation. If that be so, naturally the promotion and the increment through such promotions cannot be said to fall within this clause.
9. Admittedly, the petitioner was employed in a foreign bank and he is earning not less than Rs. 5,000 p.m. and he has filed the income-tax returns. When the second requirement of Section 80U(1)(ii) of the said Act has not been fulfilled then the petitioner will not be entitled for the deduction. The first respondent in his impugned proceedings has categorically stated that the petitioner was employed and earning and as such it cannot be said that the petitioner's permanent disability has the effect of reducing substantially his capacity to engage in a gainful employment or occupation.
10. I do not find any error apparent on the face of the record or any infirmity in the reasons given by the authorities below. Hence, there is no merit in the writ petition and the same is dismissed. However, there will be no order as to costs.