In Brief
A stock broker acting as an approved broker for Indian Bank received money from the bank that was intended to be paid as additional interest to various public sector undertakings (PSUs) making fixed-term deposits. The Income Tax Officer sought to assess this amount as the broker's income, claiming he was an independent dealer rather than a broker. The Supreme Court, reviewing evidence from related criminal proceedings showing the bank's explicit instructions and prior understanding, held that the respondent acted as a broker and trustee, not an independent dealer. Since the money was held in trust for the PSUs on the bank's behalf, it could not be assessed as the respondent's income. The Court dismissed the Revenue's appeal and upheld the High Court's decision.
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