R and B FALCON DRILLING CO. AGENT RAYMOND TATNELL vs. THE COMMISSIONER OF INCOME - TAX DEHRADUN

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ITA/7/2005HC UttarakhandUKHC01004224200519 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 the 'off period' salary shall not be included in the income accrued in view of the explanation of Section 9(1)(ii) of the Income Tax Act, 1961. The Court's reasoning was based on a prior decision 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 decided the present appeal on the same terms as the Supreme Court's judgment. The question was answered in favour of the assessee and against the revenue. The operative direction was to decide the appeal accordingly, with no order as to costs. No issue was expressly left undecided.

What were the facts?

The assessee, M/s R & B Falcon Drilling Co. as Agent of Mr. Raymond Tatnell, filed an appeal under Section 260A of the Income Tax Act, 1961. The appeal challenged an order passed by the Income Tax Appellate Tribunal, New Delhi. The core of the dispute concerned whether salary paid to the assessee for an 'off period' should be included in income accrued, as per the explanation to Section 9(1)(ii) of the Act. The assessment year(s) are not explicitly stated. The procedural history involves the assessee filing the present appeal after the Tribunal's order.

What were the issues?

1. Whether the amount paid to the assessee for the '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 argued that the amount paid for the 'off period' salary should not be included in the income accrued, relying on the explanation to Section 9(1)(ii) of the Act. The specific authorities or precedents relied upon by the assessee are not detailed in the judgment. Revenue's contention: The revenue contended that the 'off period' salary should be included in the income accrued. The specific authorities or precedents relied upon by the revenue are not detailed in the judgment.

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. 07 of 2005

M/s R & B Falcon Drilling Co. As Agent of Mr. Raymond Tatnell,

….. ….. Respondent.

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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