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TMI Blog1973 (2) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... ociety at Gauhati, an autonomous institution, which received grants-in-aid from the Government of Assam. The Income-tax Officer (respondent No. 1) wrote to the secretary of the society (respondent No. 3) to deduct income-tax of the petitioner at source under the appropriate provisions of the Income-tax Act, 1961 (briefly " the Act "), and the society is accordingly complying with the direction of the department. The petitioner claims an exemption from payment of tax as, according to him, a member of the Scheduled Tribe as such is not liable to pay income-tax. He further submits that the decision of the Supreme Court in S. K. Dutta v. Lawrence Singh Ingty , affirming the decision of this court, governs his case and he is not liable to pay an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... securities. " In Lawrence Singh Ingty's case the Supreme Court struck down the words " who is not in the service of Government " in clause (26) and the same have been omitted by Act 42 of 1970, and shall be deemed to have been always omitted. Section 4 is the charging section, and taxation is the rule and exemption is the exception. Section 5 describes the scope of total income. Section 10 appears in Chapter III of the Act with the heading " Incomes which do not form part of total income " which includes all income from whatever source derived which " is received " under section 5(1)(a) and which accrues or arises ", etc., under section 5(1)(b) and (c). By section 5, the territorial nexus of the taxing country with the income of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to charge him to tax at Gauhati, while if he earned the particular income in Garo Hills, he would have been exempted under the impugned clause. This provision, therefore, treats unequally persons equally circumstanced and placed. We have already noticed that income-tax is chargeable under section 4 and at the rates prescribed by an appropriate Central Act. Section 4, inter alia, is subject to section 10. An assessee is liable to pay income-tax under section 4 of the Act subject to section 10. The burden is, therefore, upon him to bring his case within any of the clauses in that section. Apparently, his case does not come under clause (26) of section 10 as his income accrues or arises outside the area mentioned in the clause. We have, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the members of the Tribe are helped but also the interest of the area is adequately furthered. The members of the Scheduled Tribe earning income which accrues in the Tribal area as specified are a well-defined class and there is a reasonable nexus for exempting this class from other members of the Scheduled Tribe who may have income accruing to them in a place or area outside those Tribal areas. In view of the object of the provision, to which we have already adverted, the classification in this case is well-defined. The classification is founded on an intelligible differentia and that differentia has a rational nexus with the object sought to be achieved by the exemption clause. There can, therefore, be no legitimate grievance on the sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duals do not come into the picture. " Earlier, the Supreme Court observed: " We know of no legislative practice or history treating Government servants as a separate class for the purpose of income-tax. The Government servants' income has all along been treated in the same manner as the income of other salaried officers." In that case, the assessee had all the qualifications to entitle him to the exemption except that he was a Government servant and the Supreme Court struck down that clause, which led later on to parliamentary legislation deleting the clause. We cannot but quote the following principles of law reiterated in that decision which must guide in a case of this nature : "...in deciding whether a taxation law is discriminator ..... X X X X Extracts X X X X X X X X Extracts X X X X
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