Commissioner of Income Tax vs Bagpatia Food Industries

By the court

On an application u/s 256(1) of the Income Tax Act, 1961, Tribunal has referred the following question for the opinion of this court :

"Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that section 154 of the Income Tax Act, 1961, could not have been invoked in this case ?"

The assessee was engaged in the activities of oil production work though oil expellers and was allowed development rebate at the rate of 25 per cent. Learned Income Tax Officer being of the view that in terms of item No. 31 of the 5th Schedule to Income Tax Act, 1961, the assessee is entitled for development rebate at the rate of 15 per cent. Income Tax Officer therefore, issued notice u/s 154 of the Income Tax Act and the order was passed u/s 154 of the Income Tax Act, 1961, allowing the development rebate at the rate of 15 per cent instead of 25 per cent.

None appeared for the respondent. Heard learned counsel for the revenue.

Learned counsel for the revenue submits that the issue is covered by the decision of this court in the case of this very assessee Commissioner of Income Tax Vs. Bagpatia Food Industries, wherein this court has taken the view that assessee is entitled for the rebate only at the rate of 15 per cent and Tribunal was not justified in holding that the assessing officer could not invoke the provisions of section 154 of the Income Tax Act, 1961. He further submits that the question was answered in favour of the revenue and against the assessee.

Following the decision of this court in the case of this very assessee, we answer the question in favour of the revenue and against the assessee.

Reference so made stands disposed of accordingly.

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