ADDITIONAL COMMISSIONER OF INCOME TAX ANDHRA PRADESH Vs. K RAMACHANDRA RAO

JUDGEMENT

(1.) In this reference under s. 256(1) of the I.T. Act, 1961, the question referred to us by the Income-tax Appellate Tribunal at the instance of the Commissioner of Income-tax is :

(2.) The facts necessitating the reference of the aforesaid question are as follows : Facts : The assessee is an individual. He was practising as an advocate. For the legal profession he carried on, the assessee had been maintaining accounts for the financial year commencing form April 1, and ending by March 31, each year. He was appointed as a judge of the High Court of Andhra Pradesh with effect from 21/08/1968. Prior to becoming a judge, he was also receiving remuneration at Rs. 400 per month liquidator of Vijaya Commercial Bank Ltd. He was also getting a remuneration of Rs. 400 per month as editor of Indian Law Reports. Till the assessment year 1968-69, the remuneration received by the assessee as liquidator and also as editor was being assessed as salary income. In the assessment year 1969-70, the same was assessed under the head "Profession".

(3.) So far as the salary as a judge of the High Court was concerned, the assessee maintained separate accounts for that source, as a new source of income from salary had arisen from the date of his appointment as a judge with effect from 21/08/1968. The accounts in that direction were opened on 21/08/1968, and they were made up till 31/07/1969, So far as the salary as a judge of the High Court was concerned, the same was not returned while filing the return for the assessment year 1969-70, on the basis that in so far as that source was concerned, separate accounts were maintained and they were closed on 31/07/1969. According to the assess, the salary income as a judge of the High Court cannot be assessed for the assessment year 1969-70, but it can be assessed only for the assessment year 1970-71. The ITO accepted the assessees claim and completed the assessment without including any part of the salary received by the assessee as a judge of the High Court, for the income-tax assessment year 1969-70.