Judgment

SARKAR, CJI. : The assessee was an advocate of the High Court of Bombay and was pactising his profession there till March 1, 1957, when he was elevated to the Bench of that Court. He then ceased to carry on his profession and has not resumed it since. As an advocate he had been assessed to Income-tax on his professional income, his accounting years for the assessments being the calendar years. When he was raised to the Bench, various fees for professional work done by him were outstanding. In the years 1958 and 1959 during no part of which he had carried on any profession, he received certain moneys on account of these outstanding fees. His accounts had always been kept on the cash basis. The question is, whether he is liable to pay Income-tax on these receipts.

2. We shall first make a few general observations. Section 6 of the Income-tax Act, 1922, specifies six sources or heads of income which are chargeable to tax. In order to be chargeable, an income has to be brought under one of these six heads. S. 6 also provides that the chargeability to tax shall be in the manner provided in Ss. 7 to 12-B of the Act. Each of these sections lays down the rules for computing income for the purpose of chargeability to tax under one or other of the heads mentioned in S. 6. An income falling under any head can only be charged to tax if it is so chargeable under the corresponding computing section. The fourth head of income in S. 6 is "Profits and gains of business, profession or vocation" and the fifth head, "income from other sources" The fifth head is the residuary head embracing all sources of income other than those specifically mentioned in the section under the other heads. Then we observe that the several heads of income mentioned in S. 6 are mutually exclusive; a particular income can come only under one of them: United Commercial Bank Ltd. Calcutta v. Commissioner of In-come Tax, West Bengal. 1958 SCR 79: (AIR 1957 SC 918).

3. We now turn to the present case. The receipts in the present case are the outstanding dues of professional work done. They were clearly the fruits of the assessee s professional activity. They were the profits and gains of a profession They would fall under the fourth head. viz., "Profits and gains of business, profession or vocation." They were not however chargeable to tax under that head because under the corresponding computing section, that is, S. 10, an income received by an assessee who kept his accounts on the cash basis in an accounting year in which the profession had not been carried on at all is not chargeable and the income in the present case was so received. This is reasonably clear and not in dispute: see Commissioner of Income Tax Madras v. Express Newspapers Ltd. Madras, 1964-53 ITR 250:

4. Can the receipts then be income falling under the residuary head of income and charged to tax as such ? The Commissioner of Income-tax from whose decision the present appeal has been taken by the assessee, held that it was chargeable under that head. He came to that conclusion on what he thought were the general principles and also on the authority of a certain observation of Chagla, J. in Re B. M. Kamdar, 1946-14 ITR 10: The observation of Chagla, J. does not seem to us to be of much assistance for the decision in that case was not based on it nor is it supported by reasons. We find ourselves unable to agree with the learned Judge. We may add that apart from the observation in Kamdar s case, 1946-14 ITR 10: there does not appear to be any direct authority supporting the view of the Commissioner.

5. As to the general principles, we first observe that as the heads of income are mutually exclusive, if the receipts can be brought under the fourth head, they cannot be brought under the residuary head. It is said by the Revenue that as the receipts cannot be brought to tax under the fourth head they cannot fall under that head and must therefore fall under the residuary head. This argument assumes, in