Law: Income Tax Act, 1922

Section: 4(3)(vii),23(3)

Law: Income Tax Ordinance, 1979

Section: 63

(a) Income tax Act (XI of 1922)---Ss. 4(3)(vii) & 23(3) Income tax Ordinance (XXXI of.1979), S. 63 ¬Words "casual and non recurring nature" Meaning Words "casual and non recurring" occurring in S.4(3)(vii) not defined in Income tax Act ¬Word 'casual' as defined means, inter alia, without design; not resulting from plan without specific motivations Receipt which is foreseen or provided by agreement, held, was not casual. Webster's New International Dictionary ref (1950) 18 1 T R 825; (1968) 67 I T R 616; (1950) 18 I T R 825; P L D 1981 S C 85 and Chunilal Kalyana's case I I T C 419 ref. (b) Income tax Act (XI of 1922) S.4(3)(vii) Receipts of casual and non recurring nature Scope of expression Assessee receiving a certain amount as arbitrator's fee ¬Assignment of arbitration voluntarily accepted and there was specific motivation for which assessee undertook work viz. expectation of receiving remuneration Assessee by virtue of his knowledge and expertise acted as arbitrator and earned remuneration Case, held, falls outside the scope of provisions of S.4(3)(vii) of Income tax Act. Commissioner of Income tax v. Qazi (1979) 29 Taxation 129 distinguished. ORDER GHULAM MURTAZA KHAN (MEMBER). The appellant is an Advocate and the solitary objection which is common in all the four appeals under consideration relates to the taxability or otherwise of income from arbitration fees by him. 2. During the four years under consideration the appellant received arbitration fees amounting to Rs.30,000 each in the first two years Rs.10,000 and Rs.30,000 respectively, in the subsequent two years. There is no dispute in regard to the amounts for arbitration fees received. The dispute arose due to the fact that in the returns filed the appellant treated the aforementioned arbitration receipts as exempt from tax being of a casual and non recurring nature. The I. T.O., however, did not consider the receipt to be of a casual and non recurring nature as contemplated in clause (vii) of section 4(3) of the repealed Income tax and subject the same to tax. Aggrieved with the treatment meted out by the assessing officer, the appellant brought an appeal before the learned Appellate Assistant…

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