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Syed Shah Mohammed Quadri, J.—The petitioner seeks a writ of mandamus to declare that the provisions of Section 22-D of the High Court Judges (Conditions of Service) Act, 1954 (Act 28 of 1954), for short "the Act" are applicable to the case of the petitioner and that the House Rent Allowance @ Rs. 2,500/- per month paid by the Government of India to him as the Chairman of the National Industrial Tribunal (for short "NIT"), is not liable to be taxed under the Income Tax Act, 1961.
The petitioner is a retired Chief Justice of the High Court of Andhra Pradesh. After his retirement, he was appointed as the Chairman of the National Industrial Tribunal by the Government of India in their resolution No. P.10(21)87/RRB dated November 26,1987, which was also published in the Gazette on the same day. The terms and conditions of his appointment as the Chairman of NIT are incorporated in the letter of the Ministry of Finance, Government of India, dated December 30, 1987. By the terms of appointment the petitioner was entitled to rent free furnished accommodation or House Rent Allowance at 121/2% of pay in lieu thereof. Subsequently, instead of 12l/2% he was being given House Rent Allowance @ Rs. 2,500/- per month. The petitioner says that having regard to the guidelines issued by the Government of India with regard to fixation of pay and terms and conditions of Retired Judges of the Supreme Court/High Court on re-employment on Commission/Committee of Enquiries set up by the Government of India and having regard to the terms of his appointment, the House Rent Allowance is exempted from Income Tax. The petitioner''s request for exemption of House Rent Allowance was turned down by the Director, Department of Economic Affairs (Banking Division), Ministry of Finance, Government of India after consultation with the Board of Direct Faxes and the same was communicated to the petitioner by letter dated August 10, 1988. The petitioner has also given instances of Sri Justice A. Sambasiva Rao, Retired Chief Justice, who was re-employed as Lok Ayukta; Sri justice Koka Ramarhandra Rao, Retired Chief Justice, who was appointed as One-Man Commission of Enquiry as ''Koka Ramachandra Rao Commission of Enquiry''; Sri Justice P. Rama Rao, Retired Judge of the High Court of Andhra Pradesh, who was appointed as Chairman, Pollution Control Board and Sri Justice Bakshi, Retired Judge of the Allahabad High Court, who was re-employed as Chairman of the Andhra Pradesh Administrative Tribunal, who were not taxed in respect of House Rent Allowances. In the circumstances, he seeks the writ of mandamus indicated above.
The Income Tax Officer, Ward 4 (3), Income Tax Department, respondent No. 4, alone filed counter-affidavit. The material facts are not disputed. He submits that neither in the Income Tax Act, 1961 nor in the High Court Judges (Conditions of Service) Act, 1954, as amended from time to time, it is provided that the High Court Judges, after retirement and re-employment, are entitled to exemption of House Rent Allowance from Income Tax like the sitting Judges. It is further stated that the petitioner himself filed his return of income for the assessment year 1989-90 but did not claim any deductions from salary other than standard deduction and profession tax; since the petitioner himself did not claim any deduction towards House Rent Allowance paid by him, the question of exempting the same and refunding the tax does not arise. In regard to the cases of the other Judges, it is admitted that in their cases House Rent Allowance was not assessed to tax but it is justified on the ground that the original assessments of those retired Judges were completed u/s 143(1) of the Income Tax Act. On those facts he prays for dismissal of the Writ Petition.
Mr. Y. Ratnakar, the learned Counsel for the petitioner, has contended that the terms and conditions of appointment of the petitioner as Chairman, National Industrial Tribunal are analogous to the provisions of the Act, that the petitioner was appointed only because he was a retired Chief Justice and that he is entitled to avail all those benefits which he was earlier enjoying as Chief Justice in regard to pay and allowances, therefore House Rent Allowance. should be exempted from Income Tax. He has argued that when the House Rent Allowance paid to retired Chief Justices and Judges of the Andhra Pradesh High Court on re-appointment in various capacities was exempted from income tax, there is no rational basis to single out the petitioner and that the plea that the assessment was completed u/s 143(1) of the Income Tax Act is no basis to deny the same to the petitioner.
Mr. S.R. Ashok, the learned Standing Counsel for the Income Tax Department, has submitted that Section 22-D of the Act has no application to a retired Chief Justice or Judge of the High Court just as Section 23-D has, therefore the petitioner cannot claim that the House Rent Allowance should be exempted.
The short question that arises for consideration is, whether the petitioner is entitled to exemption of House Rent Allowance paid to him by the Government of India on his re-appointment as Chairman of the National Industrial Tribunal.
Section 22A of the Act, which was inserted by Act 35 of 1976 in the High Court Judges (Conditions of Service) Act, 1954, with retrospective effect from October 1, 1974, has provided the facility of Rent Free Houses, as official residence to every Judge as defined in the Act. That provision reads as under:
"22-A. Facility of rent free houses:-
(1) Every Judge shall be entitled without payment of rent to the use of an official residence in accordance with such rules as may, from time to time, be made in this behalf.
(2) Where a Judge does not avail himself of the use of an official residence, he may be paid every month an allowance of two thousand five hundred rupees."
A plain reading of the provision, extracted above, shows that it provides the facility of use of an official residence, without payment of rent, in accordance with such rules as may, from time to time, be made in this behalf, as defined in the Act. By virtue of Rule 2-A of the High Court Judges Rules, 1956, every Judge is now entitled to a furnished official residence. Where, however, a Judge does not avail himself of the use of an official residence, he is entitled in lieu thereof to an allowance of Rupees two thousand five hundred. The quantum of allowance originally fixed was 121 /2% of his salary which was substituted by Rs. 2,500/- by the High Court and Supreme Court Judges (Conditions of Service) Amendment Act (48 of 1987) with effect from October 16,1987.
Section 22-D was substituted by the High Court and Supreme Court Judges (Conditions of Service) Amendment Act (20 of 1988) with effect from November 1, 1986. It exempts from liability to pay income tax on certain perquisites received by a Judge. It reads as follows:
"22-D. Exemption from liability to pay Income Tax on certain perquisites received by a Judge:-Notwithstanding anything contained in the Income- tax Act, 1961,-
(a) the value of rent-free official residence provided to a Judge under sub- section (1) of Section 22A or the allowance paid to him under sub- section (2) of that section;
(b) the value of the conveyance facilities provided to a Judge u/s 22B;
(c) the sumptuary allowance provided to a Judge u/s 22C;
(d) the value of leave concession provided to a judge and members of his family,
shall not be included in the computation of his income chargeable under the head "salaries" u/s 15 of the Income Tax Act, 1961."
Clause (a) of Section 22-D exempts from liability to pay Income Tax the value of rent-free official residence provided to a Judge under sub-section (1) of Section 22A or the allowance paid to him under sub-section (2) of that Section.
The resolution of the Government of India No. F.10 (21)/87-RRB, dated November 26,1987, appointing the petitioner as the Chairman of NIT inter alia, reads as follows:
"xxxx xxxx xxxx 2. Now, therefore, in terms of the said order of the Supreme Court, the Central Government hereby appoint a National Industrial Tribunal conststing of Shri Justice S. Obul Reddy, retired Chief Justice of High Court of Andhra Pradesh as its Chairman.
xxxx xxxx xxxx."
The terms of appointment of the petitioner were communicated on December 30, 1987. They are as follows:
F.No. 10-27/87-RRB Government of India Ministry of Financ Department of Economic Affairs (Banking Division) ''Jeevan Deep'' Buildings, Parliament Street, New Delhi-110001.
December 30, 1987.
To
The Pay and Accounts Officer, (ERIS and Banking), M/o Finance, Deptt. of Eco. Affairs, (Banking Division),
New Delhi.
Sub:- Terms of appointment of Shri S. Obul Reddi, Chief Justice (Retd.),Chairman, National Industrial Tribunal, Hyderabad.
Sir,
I am directed to convey the sanction of the President to the grant of the following terms and conditions of appointment of Shri S. Obul Reddi, Chief Justice (Retd.) of the Andhra Pradesh High Court, on his appointment as Chairman, National Industrial Tribunal, Hyderabad, appointed by Government to decide the question relating to pay, salary, allowances and other benefits payable to the employees of Regional Rural Banks constituted by Government under the Regional Rural Banks Act, 1976, with effect from 30-11-1987 when the Tribunal assumed charge:-
(i) Pay: Shri Reddi, Chief Justice (Retd.) will be entitled to a pay which together with pension and pension equivalent of other forms of retirement benefits shall be restricted to Rs. 9,000/- permonth with effect from 30-11-1987. (ii) Dearness Allowance: As payable to officers of All India Servicesgetting pay of Rs. 6,700 / - per month and above,from time to time, either from the date fromwhich it was admissible to sitting Judges orfrom the date on which he is appointed to the Tribunal, whichever is later. (iii)Compensatory (City) As admissible to a serving Judge of the AndhraPradesh High Court at Hyderabad. Allowance:
(iv) Travelling and Daily He will be paid these allowances according to Allowance: his entitlement on the rates at the time of his re-employment. He will also be entitled totemporary Government accommodation in the Guest Houses, Inspection Bungalows run by 1the Central Government, wherever available, on the payment of normal rent at out-stations, the class to which Government servants of thehighest class are eligible.
(v) Transfer TA: He will be entitled to Transfer TA as admissible to a Government servant of the highest gradef rom home town to headquarters for joining the Tribunal and from Headquarters to home townat the end of his assignment.
(vi) Accommodatio: He will be entitled to a rent-free furnished accommodation or house-rent allowance at121/2 % of pay in lieu thereof.
(vii) Medical facilities: As per Central Government Health Scheme. IfCGHS is not available, he will be entitled tomedical facilities as available to Cabinet Ministers.
(viii) Leave: As admissible to other re-employmentpensioners under CCSS (Leave) Rules.
(ix) LTC for Self andfamily: As admissible to re-employed pensioner andthe entitlement will be that of highest grade in the Central Government.
(x) Conveyance: He will be entitled to the payment of a lumpsumsum of Rs. 3,000/- per month with effect from30-11-1987.
xxxx xxxx xxxx."
From the letter of the Government of India, Ministry of Finance, extracted above, it is evident that the pay of the petitioner was restricted to Rs. 9,000/- per month, the pay which he was drawing as the Chief Justice before he was retired, so also the quantum of D.A. and Compensatory (City) Allowance were also given as admissible to serving Judge of the High Court. We have already pointed out above that the terms and conditions provide that the petitioner was entitled to rent-free furnished accommodation or Rs. 2,500/- P.M in lieu thereof, which is also equivalent to the a mount admissible to a serving Judge. It appears to us that all terms and conditions of appointment of the petitioner-Chairman are those admissible to the sitting Chief Justice of the High Court including those mentioned under Sections 22-A, 22-B, 22-C and Leave Travel Concession for himself and members of his family. He was appointed as Chairman of the National Industrial Tribunal as he served as the Chief Justice of the High Court of Andhra Pradesh.
It is a common knowledge that instead of a sitting Judge /Chief Justice of a High Court, a retired Judge/Chief Justice of a High Court is more often appointed to preside over the Commission or Enquiry or National Industrial Tribunal or other Tribunals and he is placed in the same position as a sitting Judge/Chief Justice to discharge his functions as Chairman of Tribunal or Commission of Enquiry, as the case may be, and is given the same pay, allowances and perquisites as a sitting Judge /Chief justice. If that be so, exemption from liability to pay Income Tax on certain perquisites received by a Judge/Chief Justice should, in our view, also apply to those retired Judge/ Chief Justice, while functioning as Presiding Officer of a Commission of Enquiry or Chairman, National Industrial Tribunal or any other Tribunal. It appears to us that facilities provided under Sections 22-A, 22-B, 22-C and Leave Travel Concessions carry with them the exemption from liability to pay Income Tax on those perquisites. Indeed when all the statutory terms and conditions including perquisites applicable to a sitting Judge are extended to the petitioner, there is no reason why the benefit of Section 22-D with regard to exemption from payment of Income Tax, inter alia , on House Rent Allowance should be denied to the petitioner.
For the aforementioned reasons, we hold that the benefit of Section 22-D(A) is available to the petitioner.
Further the petitioner has given four instances of the retired Chief Justices and that of the retired Judge of the High Court of Andhra Pradesh who enjoyed the benefit of Section 22-D in respect of House Rent Allowance and this fact is not denied by the fourth respondent. The only ground which is urged is that u/s 143(1) of the Income Tax Act the assessments of those Honourable Judges were completed. That can hardly be a ground to allow the benefit of Section 22-D in cases of some Judges and deny the same to the petitioner.
In the result we declare that the House Rent Allowance paid to the petitioner during the relevant period at the rate of Rs. 2,500/- P.M., is exempt from Income Tax u/s (sic) (a) of the Act and the same is not liable to be taxed in the hands of the petitioner.
The Writ Petition is accordingly allowed, but, in the circumstances of the case, there will be no order as to costs.