Commissioner of Income Tax vs Sharada Finance and Trading Co.

Saraf, J.—The following question has been referred by the Tribunal u/s 256(1) of the income tax Act, 1961 (''the Act'') at the instance of the revenue :

"Whether, on the facts and in the circumstances of the case, the assessee is entitled to have the entire cost of acquisition of the film "Julie" amortised in the assessment year 1976-77 ?"

The learned counsel for the revenue argued at length and stated that in the present case, undisputed factual position is that the income determined by the assessee is in respect of picture ''Julie'' only and is on the basis of regular method of accounting which is consistently, right from the past, has been recognised even by the Board. It is in view of this finding that the Tribunal has further found that the ITO was bound to determine the income on the basis of the method of accounting as per the circular of the Board setting out the guidelines in such cases.

In view of the above, we do not find any reason to interfere with the finding recorded by the Tribunal.

We, therefore, answer the question referred to, in the affirmative, i.e., in favour of the assessee and against the revenue. No order as to costs.