Cit Vs. K. Muthu - Court Judgment

Excerpt:
counsels: t. ravi kumar, for the applicant in the madras high court r. jayasimha babu & a.k. rajan, jj. - constitution of india article 141; [a.p. shah, c.j., f.m. ibrahim kaliffulla &v. ramasubramanian, jj] reference to larger bench - precedent - full bench decision held, it is binding on the division bench. only if the full bench comes to conclusion that earlier full bench decision is incorrect, there is scope for making reference to larger bench. division bench doubting correctness of full bench decision cannot direct registry for placing papers before chief justice to make reference to larger bench. ordera.k. rajan, j.the question that is referred is,'whether on the facts and in the circumstances of the case, the appellate tribunal is right in holding that the income from malaysia cannot be subjected to tax in accordance with the agreement for avoidance of double taxation of income and prevention of fiscal evasion of tax, entered into between government of india and the government of malaysia?'2. in a number of cases this court has held this issue against the revenue and in favour of the assessee. one such instance is the case reported in cit v. vr.s.r.m. firm : [1994]208itr400(mad) wherein this court has held that the income derived from malaysia cannot be clubbed for the purpose of taxation in india. hence, this question is answered against the revenue and in favour of the assessee.

Judgment:
ORDER

A.K. Rajan, J.

The question that is referred is,

'Whether on the facts and in the circumstances of the case, the Appellate Tribunal is right in holding that the income from Malaysia cannot be subjected to tax in accordance with the agreement for avoidance of double taxation of income and prevention of fiscal evasion of tax, entered into between Government of India and the Government of Malaysia?'

2. In a number of cases this court has held this issue against the revenue and in favour of the assessee. One such instance is the case reported in CIT v. VR.S.R.M. Firm : [1994]208ITR400(Mad) wherein this court has held that the income derived from Malaysia cannot be clubbed for the purpose of taxation in India. Hence, this question is answered against the revenue and in favour of the assessee.