ORDER
Vijender Jain, J.
1. The petitioner is aggrieved by the order passed by the Assessing Authority that the petitioner was not entitled to deduction either in terms of Section 80RRA of Income Tax Act or Section 80-O of the Income Tax Act.
2. It is the case of the petitioner that the petitioner after his retirement from Steel Authority of Indian Limited as Executive Director became Advisor to M/s. Davy Mckee, U.K. vide their letter December 4, 1991 at a monthly remuneration of 600/- pounds sterling. The petitioner sought permission of the Reserve Bank of India which is at pages 22 to 25 of the paper book. The petitioner filed the tax returns for the assessment year 1993-1994 where the assessment order at page 28 of the paper book was passed by the respondent. Aggrieved by the said order, the petitioner filed an appeal under Section 80RRA of Income Tax Act before the Appropriate Authority.
3. Joint Secretary to the Government of India, Ministry of Finance, (Department of Revenue), Central Board of Direct Taxes is the appropriate authority. Joint Secretary vide his letter dated 4th September, 1996 took the view that the petitioner was not qualified for grant of approval under Section 80 RRA of Income Tax Act.
4. Mr. Poddar counsel for the petitioner has contended that the respondent failed to appreciate that in order to claim relief under Section 80RRA of Income Tax Act the applicant was to satisfy that he was a technician, he has rendered his service on remuneration outside India and such remuneration was in foreign currency. He has further contended that petitioner was an advisor with M/s. Davy Mckee on monthly remuneration. He was not authorised to take up job or assignment of any other company in the similar industry. He has further contended that the law laid down by the Supreme Court in CBDT vs . Aditya V.Birla : [1988]170ITR137(SC) inter-alia holding that there was no need of a relationship of employer and employee to claim the relief under Section 80RRA of the Act also helps the case of the petitioner. He has further contended that there is no difference between a consultant and an advisor and the distinction drawn in this regard by the respondent was not sustainable in law. Mr.Poddar further contended that even otherwise a Division Bench of this Court in C.S.Mathur vs. Central Board of Direct Taxes & Another has taken the view that the amplitude of expression 'employer-employee' covers the cases of consultant or a technician.
5. On the other hand, counsel for the respondent has contended that the petitioner has not approached this Court with clean hands. He has contended that the application of the petitioner before the appropriate authority under Section 80RRA of the Act for approval of terms and conditions in column 11, the petitioner has indicated the status in which he was employed under both columns '01' as well as '02' i.e. employee as ell as advisor., whereas in the application filed before the appropriate authority which has been filed by learned counsel for the Revenue Along with the counter affidavit, the petitioner has only indicated against column '02' as an advisor.
6. Mr. Jolly has taken the same objection which was put forth before the Supreme Court in Aditya Birla's case (supra) that Section 80RRA of the Act was inserted only to encourage salaried employees who were going abroad where the cost of living was very high for availing an exemption from tax on the salary earned abroad by working as a technician.
7. I have carefully considered the arguments advanced by learned counsel for both the parties.
8. At the outset, I see no force in the arguments of counsel for the respondent that the petitioner has not approached this Court with clean hands. When the copy of the application has been filed by the respondent themselves and the petitioner has only put a tick mark under column 11 against entry '02' as advisor, the petitioner in an unambiguous terms has taken the stand that he was engaged by DEVI MECCI as an advisor. Question of concealment by the petitioner could have bene there if in the application filed before the appropriate authority the petitioner would have taken the stand that he was an employee. It is not disputed that the petitioner was receiving remuneration of 600/- pounds sterling per month in the capacity of an advisor. The only ground on which the benefit was not given to be given under Section 80RRA of the Act could be given to those governed by the 'employer' and 'employee' relationship. It was also not granted on the ground that Supreme Court's decision in Aditya Birla case amendment of Section 80-O through the Finance Act of 1991 w.e.f. 1st April, 1992 was to nullify the effect of Aditya Birla's case. In C.S.Mathur (supra) the Division Bench of this Court in paragraph 13 has held as under:-
In CBDT vs.Aditya V.Birla : [1988]170ITR137(SC) , the approval under Section 80RRA was denied to the respondent by the tax authorities on the ground that according to the terms and conditions of the agreement, the status of the respondent was that of a 'consultant' and not of an 'employee'. It was submitted on behalf of the Revenue that the provision should be confined to deduction to be given only in the case of the remuneration given to an employee and not to fees paid to a consultant or a technician. Their Lordships rejected the contention as not acceptable.
9. Relying on Aditya Birla's case the Division Bench of this Court further held that the expression 'employer' 'employee' covers the case of consultant or technician. In the scheme of the Section nothing is there to warrant any exception as contended by Revenue. In para 13.2 while reproducing from Aditya Birla's case the Court further held:-
We find that there is no warrant in Section to restrain the expression 'remuneration' received from a foreign employee only to the salary received by the employee. In our opinion, employment as a technician for the purpose indicated by Shri Palkhivala could also be an object of the Act and in such a case the fee received by a consultant or a technical would also come within the purview of the Section concerned.'
10. In paragraph 17, the Court further held:-
We are, thereforee, of the opinion that the petitioner-a chartered accountant-having agreed to render his consultancy services to foreign companies in lieu of remuneration, and though not employed on full time basis in the sense of creating master-servant relationship, would still be deemed to have been 'employed' so as to attract the applicability of S.80RRA.
11. This observation of the Division Bench in C.S.Mathur case applies squarely to the case of the petitioner. The petitioner as an advisor would still be deemed to have been employed as an employee so as to attract the applicability of Section 80RRA of the Act. With regard to the arguments advanced by respondent/Revenue that after the enactment of Section 80-O the effect of Aditya Birla's case would be to nullify the effect of Aditya Birla's case is not sustainable. Division Bench while considering the same arguments in para 22 further held:-.We have already stated and we reiterate that the submission of the learned standing counsel for the Revenue that the enactment of the amendment in the year 1992 in the provision of S.80-O amounts to implied partial repeal of S.80RRA(as interpreted in the case of Aditya Birla) has not appealed to us. The theory of implied repeal has to be accepted with caution. The inference of implied repeal cannot be drawn as it is necessarily spelled out. And certainly there is no express repeal of S.80RRA, even partially.
12. From any angle I do not find any force in arguments advanced by counsel for the respondent. I allow the writ petition. Impugned order dated 4th September, 1996 refusing the grant of approval under Section 80RRA of the Act is hereby quashed. The effect would be that the petitioner would in fact will be entitled for grant of permission under Section 80RRA of the Act.
13. Petition is allowed. Rule is made absolute.