TMI Blog2000 (11) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... ther, on the facts and in the circumstances of the case, the Tribunal is legally correct in holding that the amount of leave encashment together with regular salary of the assessee represented salary for more than 12 months ?" The factual position, which is almost undisputable is essentially as follows : For the assessment year 1972-73 corresponding to the financial year 1971-72 the assessee, an individual, claimed relief under section 89(1) of the Act in respect of Rs. 10,709, received on account of encashment of accumulated leave. The Income-tax Officer rejected the claim on the ground that such relief was admissible only in response to the assessee's salary being paid in arrears or in advance or by reasons of salary for more than 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed therein, received by an assessee from an employer or a former employer, to the extent to which it did not consist of contributions made by the assessee or interest on such contributions. It was, therefore, held that the amount in question falls under the category of "profits in lieu of salary" under section 17(3)(ii) and consequently forms part of the salary of the assessee. It was further held that the provisions of section 89(l) of the Act applied to the facts of the case. On being moved by the Revenue, the questions as set out above, have been referred for the opinion of this court. We have heard learned counsel for the Revenue. There is no appearance on behalf of the assessee in spite of notice being served on him. Learned counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not consist of contributions by the assessee or interest on such contributions." Obviously, therefore, in terms of section 17(3)(ii) any payment other than those specified in the provision itself are included in the expression salary" on being treated as "profits in lieu of salary". Section 89(1) of the Act is in the following terms : "(1) Where, by reason of any portion of an assessee's salary being paid in arrears or in advance or by reason of his having received in any one financial year salary for more than twelve months or a payment which under the provisions of clause (3) of section 17 is a profit in lieu of salary, his income is assessed at a rate higher than that at which it would otherwise have been assessed, the Assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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