TMI Blog1959 (5) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... Works' case [1954 (4) TMI 3 - SUPREME Court] would be inapplicable. Appeal dismissed. - - - - - Dated:- 5-5-1959 - Judge(s) : B. P. SINHA., J. L. KAPUR., M. HIDAYATULLAH JUDGMENT The judgment of the court was delivered by KAPUR, J.---This appeal pursuant to special leave is brought by the Commissioner of Income-tax against the judgment of the High Court of Orissa holding that the amounts received by the assessees-respondents were not received in what was British India and therefore not liable to income-tax. The respondents at all material times were non-residents carrying on business at Secunderabad which was then in the territories of the Nizam of Hyderabad. They acted as agents for the supply of gas plants manufactured b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was taken by the respondents to the Appellate Assistant Commissioner who upheld the order holding that income must be held to have accrued, arisen or received in British India. Against this order the respondents took an appeal to the Income-tax Appellate Tribunal and it was held that the amounts were received by the respondents from Madura and Bombay firms as commission but they were received at Secunderabad. The appeal was therefore allowed. The finding of the Appellate Tribunal in their own words was : " The contention of the appellants is that the cheques being negotiable instruments and the creditor having accepted them and passed through their books, the receipt must be taken to be receipts in Hyderabad. We agree with the view subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re not conclusive. " It therefore remitted the case to the Appellate Tribunal for submission of supplementary statement of case. It appears that at that stage the controversy was confined to the question whether the cheques having been sent to Secunderabad and having been realised in British India would amount to a final discharge or an unconditional one. The Tribunal in its supplementary statement found that the course of conduct followed by the parties showed that the cheques were received from the Bombay and Madura firms in full satisfaction of the commission ascertained from time to time and due on such date. It said : " The facts that such entries were made in the assessee's books, that the cheques were put into the bank immed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... post. If there is an express request by the creditor that the amount be paid by cheques to be sent by post and they are so sent there is no doubt that the payment will be taken to be at the place where the cheque or cheques are posted. The respondents argued that there was an agreement between the Madura and Bombay firms and the respondents that the money would be paid whether in cash or by cheque "at Secunderabad" and, therefore, when the cheques were sent by post the post office was the agent of the debtor and not of the respondents. There is in support of the respondents an affidavit which was filed in the assessment proceedings and which was relied upon in the High Court. According to this affidavit it was verbally agreed that the comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut it was argued for the respondents that in the absence of such a request the post office could not be constituted as the agent of the creditor and relied on a passage in Ogale's case at page 204 where it was observed : " Of course, if there be no such request, express or implied, then the delivery of the letter or the cheque to the post office is delivery to the agent of the sender himself. " It was further contended that in this case there was an express agreement that the payment was to be made at Secunderabad and, therefore, the matter does not fall within the rule in Ogale Glass Works case, and the following principle laid down in the judgment by Das, J. (as he then was), is inapplicable : " Applying the above principles to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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