Law:

Section:

Section 2(5) of the Excess Profit Tax Act, 1940 - Income from business - Assessment Years 1944-45 and 1945-46 - Assessee was appointed treasurer and guarantee commission agent of a bank at different branches - As treasurer assessee had to work under control and directions of bank while as commission agent, he had to finalise list of debtors and to stand as guarantor against loan amount - Whether pay received by assessee as a treasurer of a bank was salary received by him as servant of bank, while remuneration received by him for work of guarantee commission agent of bank was income from business as defined in section 2(5) - Held, yes FACTS As per agreement with the bank, the assessee was appointed treasurer and guarantee commission agent of the bank at different branches. For his work as treasurer the assessee was to get a remuneration of Rs. 100 per mensem. The duties that he was to perform as treasurer were set out in the agreement which provided that the assessee shall engage and employ all such subordinate cashiers, sircars, munshies, etc. as may be necessary for the efficient working of the various branches of the bank. These persons were to be under his control and he was entitled to dismiss and change them at his pleasure with the limitation that he could not employ any one who had not been approved by the bank and was bound to dismiss any one whom the managing director or the agent of the bank required him to dismiss. The duties assigned to him were that as treasurer he was put in charge of the cash department and was to be held responsible for any loss caused to the bank by his conduct or the conduct of the cash department staff, and that he was to make good any loss caused to the bank by the cashing of forged cheques or other such instruments and for payment of money to a wrong party. As a guarantee commission agent he had to recommend to the bank merchants and dealers who wanted to borrow money and if the bank accepted the names suggested, then they were termed approved borrowers. If any money was advanced to an approved borrower and he failed to repay the loan, the bank could realise the amount from the assessee. The assessee was required to furnish…

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