Commissioner of Income Tax vs Itarsi Oils and Flours Mills Ltd.

Abhay Manohar Sapre, J.—This is an appeal filed by the Revenue u/s 260A of the income tax Act, 1961, against the order dated January 31, 2003, passed by the Tribunal in Case No. 41/Nag/2001 (assessment year 1996-97). This appeal was admitted for hearing on the following substantial question of law:

Whether, on the facts and in the circumstances of the case, the income tax Appellate Tribunal was justified in allowing deduction under sections 80HH and 80-I of the Act by considering the gross income from the two units of the appellants, namely, flour mill unit, Itarsi and solvent extraction plant, Khandwa, in violation of section 80AB of the Act ?

At the outset learned counsel appearing for the parties brought to our notice a recent decision of the Supreme Court rendered in Synco Industries Ltd. Vs. Assessing Officer, Income Tax, Mumbai and Another, wherein Their Lordships had occasion to interpret sections 80HHC, 80HHD, 80-I, 80-IA and 80HH, etc. Undoubtedly, this decision was rendered after the impugned decision of the Tribunal, was passed in this case and, therefore, the Tribunal did not have an occasion and nor the benefit to examine the question involved in this appeal in the light of the law laid down by the Supreme Court in the aforesaid case.

In our view, the matter thus need to be examined by the Tribunal in the first instance on its factual aspects in the light of the law laid down by the Supreme Court in the aforementioned case, and other, decisions of the Supreme Court rendered after the decision of the Tribunal referred to in the said decision and then, the factual aspect of the matter has to be reexamined for giving a fresh finding on the issue arising in the case. It is possible only when the matter is remitted to the Tribunal for deciding the issue again.

We are, therefore, inclined to allow the appeal in part and while declining to answer the question on the merits in this appeal at this stage, remand the case for deciding the factual and legal issue involved in this appeal afresh in the light of the law laid down by the Supreme Court referred to supra.

Needless to observe we have not expressed any opinion on the merits and demerits of the controversy because, in our view, it is now for the Tribunal to give its finding on the merits.

Further, needless to observe that depending upon the order that may be passed by the Tribunal, the same can be appealed against by the parties concerned in appeal. No costs.