COMMISSIONER OF INCOME TAX, BIHAR &ORISSA vs M/S. PATNEY & CO.

The Supreme Court held that the determination of the place of payment for income tax purposes depends on the agreement between the parties. In this case, since the agreement stipulated that payment was to be made at Secunderabad, the amounts received by the respondents were deemed to have been received there, and thus not liable to tax in British India. The Court distinguished the case from Commissioner of Income-tax v. Ogale Glass Works Ltd., [1955] 1 S.C.R. 185, which had different facts regarding the place of payment.