RAJA RAMESWARA RAO vs COMMISSIONER OF INCOME-TAX,HYDERABAD

The Supreme Court held that interim maintenance allowances paid under Section 14 of the Hyderabad (Abolition of Jagirs) Regulation, 1358F, prior to April 1, 1950, are revenue receipts subject to income tax under the Income-tax Act, 1922. The Court distinguished these allowances from the commutation sum, which is a capital receipt, clarifying that the term 'final commutation' in Section 7(2) does not categorize interim allowances as part of the commutation sum. The judgment affirmed the taxability of interim maintenance allowances as income.