Commissioner of Income Tax vs Indian Metal and Metallurgical Corporation

M.N. Chandurkar, C.J.—At the instance of the Revenue, the following three questions have been referred to this court u/s 256(1) of the

Income Tax Act :

Whether, on the facts and in the circumstances of the case, Rs. 38,008, being 50% of the expenditure incurred by the assessee for providing

carpets and screens in the two cinema theatres is to be allowed as revenue expenditure for the assessment year 1972-73 ?

Whether, on the facts and in the circumstances of the case, the assessee is entitled to depreciation at 15% of Rs. 4,27,967, being the cost of the

partition works and false ceilings for the assessment year 1972-73 ?

Whether, on the facts and in the circumstances of the case, the assessee is entitled to deduction of Rs. 9,680, being provision made for gratuity

payable to its employees ?

Counsel for the Revenue fairly concedes that, in view of the decision of this court in Commissioner of Income Tax (Central), Madras Vs. Indian

Metal and Metallurgical Corporation, for the earlier assessment year 1971-72, questions Nos. 1 and 2 have to be answered in favour of the

assessee. In so far as question No. 3 is concerned, learned counsel for the Revenue also fairly concedes that three questions has also to be

answered in favour of the assessee in view of the decision of this court in Commissioner of Income Tax Vs. Andhra Prabha P. Ltd., , which view is

now confirmed by the Supreme Court in the decision in Commissioner of Income Tax, Madras Vs. Andhra Prabha P. Ltd., . Accordingly, the

three questions are answered as follows :

Question No. 1 : In the affirmative and in favour of the assessee.

Question No. 2 : In the affirmative and in favour of the assessee.

Question No. 3 : In the affirmative and in favour of the assessee.

No order as to costs.