COMMISSIONER OF INCOME TAX Vs. KOLHATKAR V Y

JUDGEMENT

(1.) BY this reference under S. 256(1) of the IT Act, 1961, the Tribunal has referred the following question of law at the instance of the Revenue to this Court for opinion : "Whether, on the facts and in the circumstances of the case and in law, the Tribunal was right in holding that the amount of pension received by the assessee from United Nations Joint Staff Pension Fund after his retirement is exempt from tax, in view of provisions of S. 18(b) of Art. V of the Schedule to the United Nations (Privileges & Immunities) Act, 1947 -

(2.) THE controversy in this case is in a very narrow compass. The assessee was serving in the United Nations Organisation. During the year under consideration he got pension from the United Nations Joint Staff Pension Fund. The amount of pension received by him during the previous years relevant to asst. year 1973 -74 and 1974 -75 was Rs. 16,860 and Rs. 13,340 respectively. The assessee claimed exemption in respect of the said amount under the provision of S. 18(b) of Art. V of the Schedule to The United Nations (Privileges & Immunities) Act, 1947 (Act 48 of 1947). The claim of the assessee was allowed by the ITO. However, the CIT being of the opinion that the order of the ITO granting exemption to the assessee in respect of the amount of pension was erroneous and prejudicial to the interest of the Revenue, initiated suo motu revision proceedings under S. 263 of the Act and directed the ITO to withdraw the exemption granted to the assessee in respect of the above amounts received by the assessee as pension from the United Nations. The assessee appealed to the Tribunal. It was contended by the assessee before the Tribunal that the pension received by him was exempt from taxation by virtue of Sub -S. 18(b) of Art. V of the United Nations (Privileges & Immunities) Act, 1947. The Tribunal accepted this contention of the assessee and approved the order of the ITO and set aside the order of the Commissioner passed on revision. The Tribunal observed that what was exempt by virtue of S. 18(b) of Art. V of United Nations (Privileges & Immunities) Act, 1947 was not only the salary but also "emoluments". Hence this reference at the instance of the Revenue.

(3.) SO have carefully considered the order of the Tribunal. We have also perused the relevant provisions of the United Nations (Privileges & Immunities) Act, 1947. This Act has been enacted to give effect to the convention on the Privileges and Immunities of the United Nations. It conform certain privileges and immunities on the United Nations and its representatives and officers. Those privileges and immunities are available notwithstanding anything to the contrary contained in any other law. The provisions of this Act have thus an overriding effect over other emoluments on the subjects. Sec. 2 of this Act reads: