TMI Blog1979 (2) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... unal was right in holding that the Income-tax officer was justified in adopting the value equivalent to Indian rupee for the value of the income in Ceylon at the official rate of exchange? " In the other tax cases heard along with this case, namely, T.C. Nos. 391 land 392 of 1975, the questions of law referred in those cases are identical and, therefore, they need not be reproduced. For our present purpose, it is enough to set out the facts in the case of the assessee in T.C. No. 364 of 1975, as there is no dispute that the facts in the connected cases are similar. The assessee, an individual, had income in India as well as in Ceylon. While accepting the return for the assessment year 1969-70, the ITO converted the Ceylon rupees into Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Indian rupees. For this purpose, during the relevant years, r. 115, as in force, ran as follows : " The rates of exchange for the calculation of the value in rupees of any income shall be as follows:-- (a) in respect of income accruing or arising or deemed to accrue or arise to the assessee or received or deemed to be received by him or on his behalf before the 6th day of June, 1966-- (i) 1 sh. 6 d.= Re. 1 ; (ii) U.S. $ 1 = Rs. 4.762; (b) in respect of income accruing or arising or deemed to accrue or arise to the assessee or received or deemed to be received by him or on his behalf on or after the 6th day of June, 1966-- (1) where such income accrues or arises or is deemed to accrue or arise to the assessee or is received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construction. The rule-making authority was to make a rule in order to provide for the conversion of income earned in any foreign currency. The idea was to fix a rough and ready method so that the ITO had not to hunt for himself the prevailing exchange rates of different currencies in relation to the Indian currency at different points of time. Subsequently, this rule itself has been changed and under the amended rule it was provided : " The rate of exchange for the calculation of the value in rupees of any income accruing or arising or deemed to accrue or arise to the assessee in foreign currency or received or deemed to be received by him or on his behalf in foreign currency shall be the telegraphic transfer buying rate of such curren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng rate of exchange as on the date of valuation and this was done only because of the absence of any rule similar to r. 115 under the W.T. Act. Therefore, this decision would not be of any assistance to determine the points now in issue. If really the contention of the learned counsel for the assessee were to be accepted, then the rule-making authority would seem to have framed a rough and ready method for the calculation of exchange rate only to income earned in sterling or dollar currency and would have left the matter for determination of the rate of exchange with reference to other currency in a nebulous state. The rule-making authority, it must be remembered, was interested in providing for the rate of conversion with reference to al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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