D N BHALLA Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference under S. 66 of the Indian IT Act made to this Court by the Tribunal. The assessee in the case is D.N. Bhalla and the year of assessment is 1952 -53, the accounting year being the year ending 31st March, 1952. The assessee in this case was employed as the Registrar of the East Punjab University soon after the partition of the State. His appointment was originally made by Ordinance No. 7 of 1947 which established the East Punjab University. The East Punjab Act No. 7 of 1947 took the place of this Ordinance, and under S. 21 of this Act the assessee was appointed as the first Registrar of the University. Sec. 21 says nothing whatsoever regarding the terms of the office or the conditions upon which his services could be dispensed with. These, however, were set out in the Regulations of the University, and according to Regulation 1 at page 57 of the Punjab University Calendar for the year 1950 -51, the assessee was removable on being given six months' notice. The wording of the Regulation is as follows :

(2.) SOME time in 1949, the assessee's services were lent by the East Punjab University to the Government of India. Soon afterwards a notice terminating the assessee's services were sent to him. This notice was sent on 13th Oct.,1950, and purported to terminate the assessee's services at the end of the period of six months. The notice was served upon the assessee on 27th Oct., 1950. Objection was taken by the assessee to this notice. The nature of his objections is not before us and the objections are not part of the statement of the case, but it is sufficient to note that some objection was taken either to the validity of the notice or to the very notice itself. The matter came up before the Syndicate of the Punjab University on 16th June, 1951, and the Syndicate recommended that a mutual agreement be arrived at between the assessee and the East Punjab University. The recommendation of the syndicate was placed before the Senate on 29th July, 1951, and the Senate passed the following resolution :

(3.) THE relevant provision of law applicable to the case is contained in Explanation 2 to S. 7(1) of the Indian IT Act, 1922, as amended up to 1951. This Explanation is in the following terms :