Law:

Section:

JUDGMENT Ansari, CJ. -These references are under section 66(1) of the Indian Income-tax Act and raise common questions of law. The relevant facts for deciding the questions in both are that the English and Scottish Joint Co-operative Wholesale Society Ltd. had, by contract of employment, provided that the society would make certain contributions in order to provide pensionary, or deferred annuity benefits to the society's employees, and the terms of such benefits were incorporated in a trust deed of July 27, 1934. Certain rules were also framed for the due and proper administration of the trust, whose copy has been made annexure "B" to the cases. Under the aforesaid arrangement the society had to pay every month 1/3 of the premium payable by each employee, who paid the remaining 2/3 for effecting a policy of insurance, and these together constituted 15% of the employee's salary. The annuity thus got became due on the employee's retirement, or on completion of the age of 55, and would not under clause 15 of the deed be payable, if the employee left service earlier, or be dismissed in the meanwhile, or died. Were the employment to end because of any of the three events stated above, the sums paid by the employee as the premiums were to be refunded to him or his legal representative. Under another provision of the arrangement, should the discontinuance be as the result of ill-health or unsuitability, the society in its discretion could pay a proportion out of the society's contribution to the employee or his legal representative. The arrangement also provided that were the retiring employee to elect not to take the annuity, it would be open to him to surrender the right and to get back the amounts paid by him and by the society in this behalf with interest. In all the cases, the trustee collected the money, the employer-society being constituted the trustee under the terms of the deed which, in its turn, paid the premia to the insurer and received later from the insurer. In the assessment year 1956-57 the society hadeoiitfibuted the following sums for the following employees: Rs. 1. 3,333 for L.W. Russel. 2. 1,733 for J.N. Marsh 3. 752 for G.E. Glover. 4. 1,467…

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