B. P. Jeevan Reddy, J. - (1.) Assessee is the appellant. He is aggrieved by the decision of the Bombay High Court in Income Tax Reference No. 458 of 1976 answering the following question, which was referred to it at his instance, against him:"whether on the facts and in the circumstances of the case the amount of tax paid by Ballarpur on behalf of the assessee in assessment years 1974-75 and 1975-76 is income taxable under the heading other sources".
(2.) The Ballarpur Paper and Straw Board Mills Limited (Ballarpur) is a public limited company engaged in the manufacture of paper and straw board. It undertook to set up a caustic soda/ chlorine manufacturing plant at Ballarpur. For this purpose, it entered into an agreement with Krebs, a French concern, for purchase of certain machinery and equipment. There was a second agreement between Ballarpur and Krebs whereunder Krebs undertook to provide services of certain personnel including engineers for setting up the plant at Ballarpur. Krebs, in turn, entered into an arrangement with a Swiss concern, Escher Wyas Eurich, for supply of certain machinery and also to make available services of certain personnel. The assessee, Emil Webber, was one such person provided by the Swiss concern. The assessee came to India and worked here in connection with the setting up of the plant.
(3.) According to the agreement between Ballarpur and Krebs the former undertook to pay salaries and other emoluments to personnel provided by Krebs in accordance with the formula contained in the agreement. Inter alia, it was provided that "salaries are understood free of any Indian tax or duty" For the assessment year 1974-75, the assessee appellant was paid a sum of Rs. 3,82,481/- and for the assessment year 1975-76, a sum of Rs. 67,200/-, in addition to daily allowances and other facilities.;