Section 64(1)(ii)

Section 64(1)(ii) — the law in short

What the courts have decided on section 64(1)(ii), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Dr J.M. Mokashi v CIT High CourtHelps departmentHigh Courts differ
  I pay my wife a salary in my own professional practice. She has no degree but she does the work. Can the Assessing Officer club that salary with my income under s.64(1)(ii)?
  On the Bombay High Court's view, yes. The proviso to s.64(1)(ii) contains two conditions and both must be satisfied: the spouse must possess technical or professional qualifications, and the income must be solely attributable to the application of his or her technical or professional knowledge and experience. Knowledge and experience in the second condition cannot be read back into the first, so a spouse who does the work competently but holds no qualification fails at the threshold.
• Batta Kalyani v CIT High CourtHelps department
  I pay my husband a salary in my business. Can the AO club it because he has no degree?
  Not on the degree point alone. A 'technical or professional qualification' in the proviso to s.64(1)(ii) does not have to be a degree, diploma or certificate from a recognised body; expertise in the profession or technique is enough, because the second limb of the proviso speaks of knowledge and experience rather than qualifications. But the proviso has two limbs and this assessee lost on the second: the Tribunal had found no evidence that the salary was solely attributable to the application of that knowledge and experience, and that finding of fact was not open to challenge. The reference was answered in favour of the revenue.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.