R and B FALCON DRILLING CO.AGENT GRANT RICHARDS vs. THE COMMISSIONER OF INCOME TAX DEHRADUN

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ITA/18/2005HC UttarakhandUKHC01004230200519 December 2005Author: HON'BLE MR. JUSTICE M. M. GHILDIYAL1 pages
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What did the High Court hold?

The High Court held that the amount paid to the assessee for off-period salary shall not be included in the income accrued. This decision was based on a prior judgment of the Hon'ble Supreme Court in Civil Appeal nos. 351-355 of 2005, with connected Civil Appeals, titled Sedco Forex International Drill Inc. and ors. vs. Commissioner of Income Tax, Dehradun and another, reported in Judgment Today 2005(9) SC 639. The High Court found that the question involved in the present appeal had already been decided by the Supreme Court. Therefore, the appeal was decided on the same terms as the Supreme Court's decision, with the question being answered in favour of the assessee and against the revenue. No order as to costs was made. The operative direction was to decide the appeal accordingly.

What were the facts?

The assessee, M/s R & B Falcon Drilling Co. as Agent of Mr. Grant Richards, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order of the Income Tax Appellate Tribunal, New Delhi. The appeal pertains to the assessment year(s) not explicitly stated in the judgment. The core issue revolves around whether the amount paid to the assessee for 'off period salary' should be included in the income accrued, as per the explanation to Section 9(1)(ii) of the Act. The procedural history indicates that the High Court heard arguments from both the appellant (assessee) and the respondent (revenue).

What were the issues?

1. Whether the amount paid to the assessee for 'off period salary' shall be included in the income accrued in view of the explanation of Section 9(1)(ii) of the Income Tax Act, 1961? (Question of law) Assessee's contention: The assessee, through its counsel, argued that the amount paid for off-period salary should not be included in the accrued income. The judgment does not explicitly detail the specific legal provisions or precedents relied upon by the assessee, other than the implicit reliance on the Supreme Court's decision. Revenue's contention: The revenue, represented by its counsel, contended that the off-period salary should be included in the accrued income. The judgment does not explicitly detail the specific legal provisions or precedents relied upon by the revenue.

Which sections of the Income-tax Act were involved?

Section 260A,Section 9(1)(ii)

AI-generated summary — verify with the full judgment below

HIGH COURT OF UTTARANCHAL AT- NAINITAL.

Income Tax Appeal No. 18 of 2005

M/s R & B Falcon Drilling Co. As Agent of Mr. Grant Richards,

…. Km. Krishi Shukla, Adv. & Sri Udyog Shukla, Advocate for the appellant, Sri S.K. Posti, learned counsel for the respondent.

Hon’ble M.M. Ghildiyal, J. Hon’ble B.S. Verma, J.

Heard learned counsel for both the parties.

The assessee has filed the present appeal u/s 260A of Income Tax Act against the order of the Income Tax Appellate Tribunal, New Delhi.

Though, several questions have been framed in the memo of appeal but in substance the only question involve in this appeal is that whether the amount paid to the assessee for off period salary shall be included in the income accrued in view of the explanation of Section 9(1) (ii) of the Act 1961?

Since the said question has already been decided by the Hon’ble Supreme Court in Civil Appeal nos. 351-355 of 2005 December 19, 2005: NCM:

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