Law:

Section:

Section 56 of the Income-tax Act, 1961 - Income from other sources - Chargeable as - Assessment year 1970-71 to 1973-74 - Assessee was employee of foreign firm - Under contract entered into between foreign firm and company 'H', assessee was deputed to India to supervise work of installation and creation of machinery in shipyard of company 'H' - Under said contract, 'H' took responsibility to pay income-tax which was due and payable by assessee during his stay in India - Whether amount received by assessee from 'H' to words taxes due was a regular payment and under a settled scheme of business transactions and thus it was liable to be taxed as income from others sources in hands of assessee - Held, yes Section 10(14) of the Income-tax Act, 1961 - Special allowance - Assessment years 1970-71 to 1973-74 - Whether in view of facts stated under head 'Income from other sources - Chargeable as', outstation allowance and hotel charges received by assessee from his employer were to meet his personal expenses in India and not for the performance of his duties and, therefore, could not be called as special allowance falling under section 10(14) - Held, yes Section 154 of the Income-tax Act, 1961 - Rectification of mistakes - Apparent from records - Assessment years 1970-71 to 1973-74 - Whether under section 154(1) both mistake of facts as well as mistake of law can be rectified - Held, yes - Whether where on facts stated under head ' Income from other sources - Chargeable as', ITO originally treated amount paid by 'H' to assessee as income of assessee from other sources but did not apply correct method of grossing up, there was an error apparent from record and could be rectified under section 154 - Held, yes FACTS The assessee was an employee of a foreign firm. Under the contract entered into between the company 'H' and the said foreign firm, the assessee was deputed to India to supervise the work of installation and erection of machinery in the new ships of the company 'H'. Under the terms of those contracts, 'H' took the responsibility to pay income-tax which was due and payable by the assessee on the total income which he had earned during the period of his stay in…

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