KAPUR,J. - (1.) THIS writ petition is concerned with the quantum of tax to be paid in the peculiar circumstances of this case. The first petitioner, Mr. Frank Beaton, was the area manager in Delhi for the second petitioner, M/s Qantas Airways Ltd., from January, 1968, to November 12, 1971. He was a non - resident and M/s Qantas Airways Ltd. is an Australian company wholly owned by the Government of Australia. During the period the first petitioner was posted at Delhi, he received a tax -free salary, and also, rent -free accommodation. In the period relevant to the asst. year 1971 -72, his salary was Rs. 73,712, and rent -free accommodation in the form of a house rented at Rs. 2,400 per month was provided to him. During the period relevant to the asst. year 1972 -73, he received a salary of Rs. 39,072 and corresponding rent -free accommodation for a shorter period. The ITO calculated the taxable income for 1971 -72 at Rs. 8,33,486 and the tax demand for this period was for Rs. 7,37,508. For 1972 -73, the salary was computed at Rs. 3,04,311 and the tax demand was for Rs. 2,53,764. It may be mentioned that the assessment was based only on salary income, so that the "tax -free" salary of Rs. 73,712 plus perquisites was grossed up to Rs. 8,33,486 for the asst. year 1971 -72 and the "tax -free" salary of Rs. 39,072 for 1972 -73 with perquisites was grossed up to Rs. 3,04,311. The tax demands were collected from petitioner No. 2, which paid them up, perhaps because petitioner No. I found himself unable to leave the country unless they were paid.
(2.) WHEN the assessments were made, the first petitioner had already left the country; so no appeals could be filed by him but, eventually, revision petitions were filed before the CIT under s. 264 of the INCOME TAX ACT, 1961. An order was passed by the CIT on September 8, 1982, holding that the calculation made by the ITO was correct. Against that order, the present writ petition was moved. On consideration of the petition, a show -cause notice was issued to the respondents. It was represented to us that this was a point of some importance as there were several cases of other foreign nationals who were getting "tax -free" salary, so the case should be decided at this stage itself. We accordingly directed the parties to complete the pleadings in -forming them that this petition will be finally disposed of. We have, in other words, treated this petition as one in which rule nisi has already been issued and have heard the parties. However, the questions involved are of much greater difficulty than at first appearance.
(3.) IN order to determine the correctness of the order, it may be useful to refer to S. 264 of the IT Act, 1961, which deals with the power of the CIT to revise an order passed by an authority subordinate to him. This allows an aggrieved party to file a revision before the CIT. The CIT may pass an order revising the order, but cannot pass an order prejudicial to the interest of the assessee. This reference is necessary because preliminary objections have been raised that this petition is not maintainable. The order refusing to revise the order is certainly amenable to the writ jurisdiction of this Court. If tax beyond the legitimate amount has been charged in this case, it will be a case of an illegal demand which contravenes the constitutional provisions that tax has to be imposed in acc8ance with law. We, therefore, overrule the preliminary objection to the effect that the writ petition is not maintainable.;