High Court Of Madras
CIT vs. J.H. Tarapore (Died) By T.Raghavan
Section 4
Asst. Year 1979-80
V.S. Sirpurkar & N.V. Balasubramanian, JJ.
T.C. No. 1212 of 1987
24th June, 2002
Counsel Appeared
T.C.A. Ramanujam, for the Revenue : V. Ramachandran for Mrs. Anitha Sumanth, for the Assessee
JUDGMENT
V.S. SIRPURKAR, J. :
The questions referred, at the instance of the Revenue, to us are as follows : Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the sum of Rs. 9,82,068 being the amount received under the arbitration award for the work done in connection with the feeder canals for the Farakka Barrage Project during the period 1st Jan., 1966, to 30th Sept., 1969, was not a revenue receipt but only a capital receipt in the hands of the assessee ? Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the source being the work executed by the firm and that as it passed on to the assessee, Shri J.H. Tarapore in terms of settlement deed, it can only be an application of income ?
We are not setting out the facts involved as they are covered in paras. 4 to 7 of our judgment in Tax Case No. 587 and 588 of 1984 [reported as CIT vs. J.H. Tarapore (Died) (2002) 176 CTR (Mad) 496—Ed.].
In the Tax Case No. 587 of 1984, which was pertaining to the asst. yr. 1974-75 we have already taken a view that the amounts which have been received for the work done for the period earlier to the dissolution of the firm would be assessed as income at the hands of the assessee, who was none else but the erstwhile partner of the firm and who continued the very same business of the firm after the dissolution of the firm. The assessee also executed the unfinished work of the contract and also proceeded to do some more works in pursuance of the contract. Even in respect of the works done after the dissolution of the firm, we have taken a view in Tax Case No. 588 of 1984 that even such receipt would amount to income in the hands of the assessee. In that view, we do not deem it necessary to take any different view in respect of the amount in question Rs. 9,82,068 (Rs. 9,90,426 minus interest of Rs. 8,358 which was nothing but a fallout of the arbitration award dt. 8th May, 1978, made at the instance of the assessee. We have already held the similar amount as the revenue receipt and have negatived the contention of the assessee that the amounts received for the work done was in the nature of capital receipt.
In that view, we would answer the questions referred against the assessee and in favour of the Revenue.
[Citation : 257 ITR 474]
