COMMISSIONER OF INCOME TAX Vs. B RAMAMURTHY

JUDGEMENT

(1.) THE following common question was referred to this court under section 256(1) of the Income-tax Act, 1961"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in holding that the pension received by the assessee from the United Nations Organisation is exempt from tax for the assessment years 1976-77 and 1977-78 ?" THE above question has to be answered against the Revenue in view of the Board's Circular No. 293 dated February 10, 1981 (see [1981] 130 ITR(St) 5), which reads as follows"Pension received from United Nations Organisation-Taxability thereof-RegardingSection 2 of the United Nations (Privileges and Immunities) Act, 1947, read with section 18, clause (b) of article V of the Schedule thereto, inter alia, grants exemption from taxation to salaries and emoluments paid by the United Nations to its officials. THE question whether pension received by the erstwhile officials of the United Nations from it would be exempt from income-tax was considered by the Karnataka High Court in the case of CIT v. K. Ramaiah 1980 (126) ITR 638. THE High Court held that since under section 17 of the Income-tax Act, 1961, salary has been defined to include pension, if salary is exempted from tax, so shall be the pension. THE Board have accepted the decision of the Karnataka High Court." In view of the above circular, the question is answered against the Department. No costs.