Commissioner of Income Tax vs Kohinoor Flour Mills P. Ltd.

The following question was referred by the Tribunal for the opinion of the High Court (See Commissioner of Income Tax, Gujrat Vs. Kohinoor Flour Mills, ) :

Whether, on the facts and in the circumstances of the case, the Tribunal erred in law in holding that Rs. 1,83,000 paid by the assessee on March 26, 1965, should be treated as valid advance tax and should be deducted from 75 per cent, of the tax determined for arriving at the basis for imposing the penalty u/s 273(b) of the income tax Act, 1961 ?

We have heard Mr. B.B. Ahuja, learned Counsel for the Revenue. He has taken us through the judgment of the High Court ( Commissioner of Income Tax, Gujrat Vs. Kohinoor Flour Mills, ) and various other documents on the record. The High Court, in a detailed discussion of various provisions of the income tax Act, has come to the conclusion that the assessee was entitled to claim the deduction of payment of tax of Rs. 1,83,000 made on March 26, 1965, for arriving at the basis for imposing penalty. The question was answered in the negative and against the Revenue. We agree with the reasoning and the conclusion reached by the High Court. The appeal is, therefore, dismissed with no order as to costs.