HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
K. C. Joshi v. Union of India and Others
Civil Appeal No. 3187 of 1982
[1985] 3 SCR 869 ·
Income-tax Act, 1961: sections 17(3), 89, 192 · Income-tax Rules, 1962: rule 21A · Constitution of India: articles 12, 14, 16
Holding and result. After setting aside the termination and awarding Rs.2 lakh in back wages and compensation, the Court directed that the employee was entitled to section 89 relief read with rule 21A if tax was deducted from the lump sum; the appeal was allowed without costs.
Sources & disclosures includedDownload original judgment / order
Two-judge bench; judgment delivered by D. A. Desai, J. · D. A. Desai, J. · Ranganath Misra, J.
01 · Facts of the case
ONGC terminated a regularly continued storekeeper who had been active in the employees’ union. Eighteen years later the Court found the termination arbitrary and unlawful. At the employee’s choice, ONGC agreed to pay Rs.2 lakh as back wages and compensation instead of reinstatement, supported by a year-by-year calculation.
02 · Discussion by the Hon’ble Court
The Court treated ONGC as State for fundamental-right purposes and held that the termination could not stand. Because a single lump-sum payment might trigger salary withholding under section 192 at a higher rate, the Court followed Sant Raj and applied section 89 with rule 21A to spread the arrears and compensation for relief.
Source: Primary judgment: reasoning
03 · Judicial decision
The employee was entitled to section 89 relief because the award included eighteen years of salary arrears and compensation in lieu of reinstatement; ONGC was to assist with any required application.
Source: Primary judgment: holdings
04 · Outcome / in whose favour
Appeal allowed; High Court judgment set aside; ONGC directed to pay Rs.2 lakh within four weeks. No order as to costs.
05 · AKHB REVIEW POINT
AKHB analysis: preserve the year-wise composition of a lump-sum employment award before withholding and section 89 work. The judgment supports relief analysis, but entitlement and calculation still depend on the governing rule, payment character and competent application.
Source & verification
Download original judgment / order · Open cited source rendition
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Statutory scope
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Later treatment
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General legal and tax research only; not legal or tax advice. Verify the complete judgment, governing statutory version and subsequent judicial treatment before reliance. The AKHB REVIEW POINT is editorial analysis, not the Court's holding, and no current-law clearance is claimed.