COMMISSIONER OF INCOME TAX vs. READING and BATES EXPLORATIONS CO.

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ITA/520/2001HC UttarakhandUKHC01006286200303 November 2003Bench: OTHER1 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that free food, beverages, and boarding on the rig were not a perquisite under Section 17(2)(iii) of the Income Tax Act. This decision was based on the Court's prior judgment dated October 9, 2003, in Income Tax Act Appeal No. 57 of 2002, titled The Commissioner of Income Tax, Meerut & another V/s SEDCO Forex International Drilling Co. Ltd. The Court answered the question in the affirmative, in favour of the assessee and against the Department. The operative direction was that the appeal be disposed of. No specific relief was granted or deleted as the appeal was decided based on a precedent.

What were the facts?

This case involves an appeal by the Commissioner of Income Tax, Dehradun, and the Income Tax Officer, Special Ward, Dehradun (the appellants/revenue) against M/s Reading & Bates Exploration Co., acting as agent for Mr. R.J. Temple (the respondent/assessee). The assessment year(s) are not explicitly stated. The appeal challenges a decision concerning whether free food, beverages, and boarding provided on a rig constituted a perquisite under Section 17(2)(iii) of the Income Tax Act. The procedural history indicates that an affidavit proving service was taken on record, and the matter was listed for hearing. The respondent was not represented.

What were the issues?

1. Whether free food, beverages, and boarding provided on the rig was not a perquisite under Section 17(2)(iii) of the Income Tax Act? The revenue contended that such provisions constitute a perquisite. The assessee's arguments are not recorded as they were not represented. The Tribunal was asked to decide this question of law and mixed fact and law, turning on the interpretation of Section 17(2)(iii) of the Income Tax Act, 1961.

Which sections of the Income-tax Act were involved?

Section 17(2)(iii)

AI-generated summary — verify with the full judgment below

2003:UHC:3357

IN THE HIGH COURT OF UTTARANCHAL AT NAINITAL

Income Tax Appeal No. 520 of 2001

1.

The Commissioner of Income Tax, Dehradun. 2. The Income Tax Officer, Special Ward, Dehradun. ………. Appellants Versus

M/s Reading & Bates Exploration Co., as agent of Mr. R.J. Temple, C/o M/s Arthur Anderson & Company, 426, World Trade Centre, Barakhanba Lane, New Delhi

………Respondent

Mr. S.K. Posti, Advocate for appellants. None for the respondent.

Coram: Hon’ble S.H. Kapadia, C.J. Hon’ble M.M. Ghildiyal, J.

Date: 03.11.2003

PC:-

Affidavit proving service taken on record.

The matter is squarely covered by our decision dated 9 th October 2003 in Income Tax Act Appeal No. 57 of 2002; The Commissioner of Income Tax, Meerut & another V/s SEDCO Forex International Drilling Co. Ltd.. The question raised before us is as follows:- QUESTIONS:

(1) “Whether, free food, beverages and boarding on the rig was not a perquisite under section 17(2)(iii) of the Income Tax Act?”

ANSWER:

In view of our above judgment, we answer both the question in the affirmative that is in favour of the assessee and against the Department. Appeal disposed of. No order as to costs.

(M.M. Ghildiyal, J.) (S.H. Kapadia, C.J.)

Gur

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