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Supreme CourtFull Bench(1987) 07 SC CK 0005

Commissioner of Income Tax, Bombay vs Gannon Dunkerley and Co. Ltd.

Supreme Court Of India · Decided on 14 July 1987 · Citation: AIR 1987 SC 1873 : (1987) 64 CTR 134 : (1987) 167 ITR 637 : (1987) 3 JT 64 : (1987) 2 SCALE 21 : (1987) SCC 188 Supp : (1987) 1 SCC 188 Supp : (1987) 2 UJ 324

HON’BLE JUDGES
R. S. Pathak, C.J · Ranganath Misra, J · B. C. Ray, J
RESULT
Allowed
CASE NUMBER
Civil Appeal No. of 1978 (arising out of S.L.P. (C) No. 1297 of 1976); (with C.A. No. of 1987 arising out of S.L.P. (C) No. 4327 of 1977); Civil Appeal No. 113 of 1975 (with C.A. No. 1534 of 1977); Civil Appeal No. of 1987 (arising out of S.L.P. (C) Nos.

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Judgment

3 paragraphs · 235 words
1.

These are appeals by special leave and the impugned order in each of these appeals is of the Bombay High Court rejecting the application of the Commissioner of income tax, Bombay u/s 256(2) of the income tax Act of 1961. As in our opinion a question of law does arise out of the appellate order of the Tribunal in each of the cases, the Tribunal should have allowed the application u/s 256(1) of the Act and when that was refused and the High Court was moved, the High Court should have allowed the several applications u/s 256(2) of the Act and directed the Tribunal to state a case and refer the appropriate question for the opinion of the High Court.

2.

Since we are directing a statement to be called for and the question to be referred, we refrain from expressing any opinion which might prejudice either of the parties before the High Court. We allow the appeals, vacate the orders of the Tribunal as also of the High Court confined to the question of reference and direct the following question to be referred by the Tribunal to the High Court for its opinion:

Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the expenditure by way of secret commission was deductible u/s 37(1) of the Act in computing the business income of the assessee?