COMMISSIONER OF INCOME-TAX Vs. V Y KOLHATKAR

JUDGEMENT

(1.) BY this reference under section 256 (1) of the Income-tax Act, 1961, the Tribunal has referred the following question of law at the instance of the Revenue to this court for opinion :

(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 the assessment years 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 provisions of section 18 (b) of article V of the Schedule to the United Nations (Privileges and Immunities) Act, 1947 (Act 46 of 1947 ). The claim of the assessee was allowed by the Income-tax Officer. However, the Commissioner of Income-tax being of the opinion that the order of the Income-tax Officer 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 section 263 of the Act and directed the Income-tax Officer 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 section 18 (b) of article V of the United Nations (Privileges and Immunities) Act, 1947. The Tribunal accepted this contention of the assessee and approved the order of the Income-tax Officer and set aside the order of the Commissioner passed on revision. The Tribunal observed that what was exempt by virtue of section 18 (b) of article V of the United Nations (Privileges and Immunities) Act, 1947, was not only the salary but also "emoluments". Hence, this reference at the instance of the Revenue.

(3.) WE have carefully considered the order of the Tribunal. We have also perused the relevant provisions of the United Nations (Privileges and Immunities) Act, 1947. This Act has been enacted to give effect to the convention on the privileges and immunities of the United Nations, It confers certain privileges and immunities on the United Nations and its representatives and officers. These 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 enactments on the subject. Section 2 of this Act reads :