COMNHSSIONER OF INCOME TAX vs A.G. NARAYANAN

BY THE COURT:

By this reference under s. 256(l) of the IT Act, 1961, (the Act), the Tribunal has referred the following questions of law to this Court for opinion.

"(i) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that Rs. 48,574 received by the assessee from the staff superannuation fund is income, but at the same time not liable to be assessed or charged to tax?

(ii) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in ignoring the provisions of cl. 6 of part B of TV schedule for deduction of tax from such income and rendering it otiose and reducing it to a meaningless and idle formality?"

We have already decided an identical controversy in IT Ref. No. 222 of 1987 (reported as COMMISSIONER OF INCOME TAX Vs. J.V. KOLTA, wherein we have held that receipts by an employee from the approved superannuation fund are not taxable for and upto the asst. yr. 1995-96. The controversy in this case pertains to the asst. yr. 1976-77. Following the said decision, we hold that during the relevant assessment year receipts of approved superannuation fund by the assessee was not income liable to Income Tax under the Act.

We find that the questions are not properly framed. We, therefore, reframe the question as follows-.

"Whether on the facts and in the circumstances of the case, the sum of Rs. 48,574 received by the assessee from the approved superannuation fund on his premature retirement is not liable to be assessed or charged to under the IT Act, 1961?"

We answer the above question in the affirmative and in favour of the assessee.

Reference is disposed of accordingly with no orders as to costs.

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