COMMISSIONER OF INCOME TAX vs U.P. STATE WAREHOUSING CORPN.

Satish Chandra, C.J. - For the assessment year 1970-71, the Tribunal has referred the following two questions for our opinion :-

"1. Whether, on the facts and in the circumstances of the case, the Tribunal was legally correct in holding that the assessees income from warehousing charges and miscellaneous receipts was exempt from tax within the meaning of S. 10(29) of the Income Tax Act, 1961 notwithstanding the provisions of S. 39 of the Warehousing Corporation Act, 1962 ?"

Whether, on the facts and in the circumstances of the case the Tribunal was legally correct in holding that no surtax was chargeable on the income of the assessee for the assessment year 1970-71, even though the assessee had itself filed return of chargeable profit under S. 5 of the Companies (Profits) Surtax Act, 1964, showing the chargeable profits at Rs. 6,65,270/- ?"

The Tribunal following a decision of this Court in U.P. State Warehousing Corporation vs. Income Tax Officer, A-Ward, Circle II, and another, has held that Warehousing charge and miscellaneous receipts were exempt from tax within the meaning of S. 10(29) of the Income Tax Act, 1961, notwithstanding the provisions of S. 39 of the Warehousing Corporations Act, 1962. The earlier decision of this Court was inter parties, though for another assessment year. We are bound by it. The second question is consequential on the first.

In view of the earlier decision inter parties, both the questions are answered in favour of the assessee and against the Department. The assessee will be entitled to costs which are assessed at Rs. 200/-.