TMI Blog1967 (1) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to as the Act). The question referred is : " Whether, on the facts and in the circumstances of the case, the sum of Rs. 32,218 was assessable to tax in the assessment year 1957-58 ? The material facts are these : The assessee is a registered firm dealing in iron goods and also runs a steel rolling mill. The relevant assessment year is 1957-58, the previous year being the year ended 3rd February, 1957. During the relevant year, the assessee received a sum of Rs. 32,218 from the Government on account of difference in the price of goods supplied by the assessee to permit-holders in the accounting periods relevant for the assessment year 1943-44 onwards. The supplies were made during the war years when the price of iron and steel g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee's contention that the receipt was of a casual nature and did not represent business income and also that the amount received did not fall to be assessed in the year of receipt. The departmental officers in coming to this conclusion relied upon the decision of the Tribunal in respect of the assessment years 1950-51 and 1951-52 during which years also similar payments had been received by the assessee. In these years the Tribunal had held : (a) that the amount received was not of a casual nature, and (2) that it was assessable in 1950-51 and 1951-52, the years in which the amount was actually received. Against the order of the Tribunal for those assessment years the assessee took the matter to the High Court under section 66(1), but the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance of the assessee. At the outset, it may be stated that the said decision of the Madras High Court, on which the claim was resuscitated, in spite of its having been abandoned after the decision of the Tribunal in respect of the appeals for the assessment years 1950-51 and 1951-52, has since been overruled by the Supreme Court in Commissioner of Income-tax v. A. Gajapathi Naidu. In that case, the Supreme Court approved the view of this court in Commissioner of Income-tax v. Kalicharan Jagannath. In the latter case it was held : " Even though the amount was payable because the assessee had carried out the contract in the accounting year 1945-46 in accordance with the agreement entered into in that year, the mere execution of the agreem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... praesenti solvendom in futuro. It was so laid down by the Supreme Court in E. D. Sassoon Co. v. Commissioner of Income-tax. In the present case, there was certainly no debt created in favour of the assessee during the war years and, therefore, there is no question of any payment having been made later in respect thereof. As already observed, the Steel Controller had, at best, in mind certain principles on the basis of which he hoped to give the iron and steel rolling mills some relief for the loss or reduction in profits as a result of the enforcement of controls. The assessee also had correctly understood the position that there was really no agreement or contract much less a debt created in his favour. Otherwise, its system of accountin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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