Commissioner of Income Tax vs I.T.C. Ltd.

Ajit Kumar Sengupta, J.—At the instance of the Commissioner of Income Tax, West Bengal-II, the following question of law has been referred to this court u/s 256(1) of the Income Tax Act, 1961, for the assessment year 1960-61 :

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that depreciation debited in the account books in excess of what was allowed in the assessment should also bE Included in the capital computation under the Second Schedule to the Companies (Profits) Surtax Act, 1904 ?"

This question is concluded by the decision of this court in the case of Commissioner of Income Tax Vs. Karam Chand Thapar and Brothers, . Following the said decision, we answer this question in the affirmative and in favour of the assessee.

The other question which has been referred to this court at the instance of the assessee is as follows :

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that the capital of the company computed in accordance with Rules 1 to 3 of the Second Schedule to the Companies (Profits) Surtax Act, 1964, should be proportionately reduced under Rule 4 thereof, having regard to the deductions allowed in the Income Tax assessments under the various provisions of Chapter VI-A of the Income Tax Act, 1901 ?"

In view of the decision of this court in the case of Commissioner of Income Tax Vs. Peico Electronics and Electricals (Formerly Philips India Ltd.), , this question is answered in the negative and in favour of the assessee.

There will be no order as to costs.

K.M. Yusuf, J.

I agree.