H.N.SETH, J. - (1.) THIS is a petition under Article 226 of the Constitution. The petitioner, Messrs. Thakur Das Shy am Sunder, prays for a writ of certiorari for quashing the order of the Additional Commissioner of Income -tax, U.P., Lucknow, dated 15th of January, 1972.
(2.) THE petitioner is a commission agent carrying on its business in Shahjahanpur, It claims that in the district of Shahjahanpur there is a long standing custom according to which the commission agents charge onevery transaction of sale of goods worth Rs. 100, a sum of 15 paise from the person to whom goods are sold and 10 paise from the person whose goods are sold through them as dharmada. This charge is over and above the commission which a commission agent is entitled to receive from both the parties. Dharmada so collected is a customary levy which is realised and credited by the commission agent in a separate account known as dharmada account. This amount is held by them on trust to be utilised specifically and exclusively for charitable purposes. During the accounting year, relevant to the assessment year 1970 -71, the petitioner received and credited a sum of Rs. 2,400 in its dharmada account. The Income -tax Officer, Shahjahanpur, treated this receipt as the petitioner's income and brought it to tax. Being aggrieved by the order of the Income -tax Officer, the petitioner filed a revision before the Commissioner of the Income -tax, U.P., Lucknow, which was rejected on January 15, 1972. The Additional Commissioner held that the amount in dispute was received by the petitioner during the course of business transaction and was undoubtedly its trading receipt; the ownership in the funds vested entirely in the petitioner, who was free to spend the amount according to its own discretion. In the circumstances, the Income -tax Officer was justified in treating the amount of dharmada received by the petitioner as its trading receipt and in including it in its income. The petitioner then filed the present writ petition before this court contending that the amount of dharmada collected by it was not its income and the income -tax authorities had no jurisdiction to include the same in its total income. Learned counsel for the petitioner pointed out that the petitioner had been collecting dharmada and crediting the same in the dharmada account for the last several years. From this account it had been making contribution to charity from time to time. For the assessment year 1968 -69, when a similar question arose for consideration, the Appellate Assistant Commissioner of Income -tax held that the amount realised as dharmada was not the income of the petitioner and as such it was not liable to be taxed in its hands. During the accounting year relevant to the assessment year 1970 -71 also the petitioner received a sum of Rs. 2,400 as dharmada for being credited to its dharmada account which was already in existence.
(3.) THE Division Bench, before which the petition came up for hearing, thought that on the point raised in this petition there is a conflict between two decisions of this court, viz., in the cases of Bijli Cotton Mills Ltd. v. Commissioner of Income -tax, [1970] 76 I.T.R. 194 (All.) and Kanpur Agencies Private Ltd. v. Commissioner of Income -tax, [1968] 70 I.T.R. 337 (All.). It, accordingly, referred this case for decision by a larger Bench.;