TMI Blog2008 (8) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue, seeking to challenge, the order of the Tribunal, dated 22.7.2004, whereby the order of the Commissioner of Income-tax (Appeals), dated 26.8.1996, was affirmed. The learned Commissioner of Income-tax had set aside the order of the assessing officer, passed consequent upon a notice under Section 148, making addition of Rs. 1,28,642.50/-. 2. The facts, lie in the very narrow compass, in as much as, the assessee, at the relevant time, was sitting MLA, and former Chief Minister of the State, who had submitted his return of income, received by him as salary, and disclosing other incomes also, however notice under Section 148 was issued for the reason, that the assessee received a sum of Rs. 1,28,643/- from the State Government, as re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y placing reliance on judgments of the Delhi High Court, and few judgments of the Tribunal, it was found, that taxing of reimbursement of medical expanses, would be contrary to the law. Thus, the addition of tax was set aside, and some more additions, which were proposed to be made, during course of appeal, were also declined. 4. This order has been affirmed in appeal by the tribunal. 5. The appeal was admitted vide order dated 4.10.2006, by framing following substantial question of law :- (i)Whether remuneration/allowances paid to assessee as a member of Legislative Assembly is taxable under the head "Income from salary". (ii) If so whether in the facts and circumstances of the case, the reimbursement of medical treatment taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before it became due to him; (c) any arrears of salary paid or allowed to him in the previous year by or on behalf of an employer or a former employer, if not charged to income tax for any earlier previous years................." 7. Thus, from reading of this section it is clear, that fundamental requirement, for attracting this section is that, there should be relationship of employer and employee, whether in existence, or in the past. Obviously, and inherently, in the very nature of things, for bringing about such relationship, the assessee, being the person concerned, should have been employed by the employer, and as a necessary corollary, the employer should have right to discharge or terminate the employee. This basic ingredient ..... X X X X Extracts X X X X X X X X Extracts X X X X
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